We all take for granted that we can easily pick up wine, beer and spirits at a liquor store or order these drinks in a restaurant. What we don’t think about is all that happens before a drink reaches our hand.
First, a little history. During Prohibition, bootlegging and other illegal activities proliferated in the alcoholic beverage industry, says Breakthru Executive Vice President, Jeremy Tostrup. When Prohibition ended, states wanted to regulate alcohol for safety and for collecting taxes. The regulations dictate a three-tier system: the producer, the distributor and the seller. “We’re the middle tier,” says Tostrup. “We don’t own anything, we don’t make anything. We’re a logistics company. A sales and marketing company. And we’re a consulting company.”
Alcoholic beverage consultants know the trends. “If rosés are hot and a restaurant has only one rosé and none by the glass, we use analytics and education to go explain to the customer what’s hot right now. We have several people whose job it is to help customers rearrange their shelves to maximize profit using data and analytics.
“Things at eye level in liquor stores sell three or four times better than things on the top or the bottom. Trends are constantly changing and the store has a finite amount of space. We have each store’s actual sales data, and using market analytics, we can say, ‘We know cordials are declining, so we can take some space [for more popular items] there.’ That prevents out-of-stocks, and it promotes high velocity brands.
“We set up most of the new stores based on market data. Some people buy a liquor store and don’t know how to set it up. Long before they get their liquor license, we’re telling them where beer should be, where wine should be, what’s high on their shelves.” Nationally, craft beer is about 17.5% of beer sales—liquor stores in Colorado need to know it’s more than double that here.
For restaurants, Breakthru has their Alchemy Room—a full bar and professional kitchen—the only distributor in Colorado with such a facility. “So now some of our accounts come in and we help with the concept and design of their menu,” says Tostrup.
Within the building is a design and print department for menus, posters, signs, coasters and glassware. Stacks of marketing merchandise for customers fill an entire section of the warehouse. A separate print department outputs invoices and stickers for 40,000 to 50,000 items a night.
The automated labeling/moving/sorting conveyor belt pictured above is called the case shuttle system. Before that system, orders couldn’t be sorted and routed until the end of the day, when all order were in. Now, with the case shuttle system, orders go into the automated system immediately. About noon workers start pulling the 11,000 bottles and 40,000 cases that will go out the next morning. It’s not fully automated, but it’s state of the art, says Tostrup. “We’re a union warehouse. Every case and every bottle is touched by hand.”
Though the warehouse currently has a million cases, Tostrup says the building is expected to serve their needs for another 20 years by expanding upward with taller shelves.