The problem with trade sales in the craft beer industry
Back when we started Sellar, we couldn’t believe that the B2B side of the $1.7 trillion beverage industry was still operating through a slurry of phone calls, emails, PDFs and spreadsheets. And when Chris Drummond, the founder of GTB (Good Things Brewing) and now Allkin Brewing, came to us to build a solution so he could take his brewery to the next level, we couldn’t believe there wasn’t one that already existed.
Good Things Brewing - 2019
So, before building Sellar, we looked for one. The first thing we tried putting together for Chris was a B2B portal on Shopify. We figured Shopify is the gold standard in global e-commerce, with good reason too. It’s an incredible platform. However, while it solved some problems, it didn’t quite work for a few different reasons. Fundamentally, trade (B2B) sales are different to DTC (Direct to Consumer). Trade sales are built around people and relationships. You need full control and flexibility over pricing tiers, discount structures, delivery methods, credit notes and payment terms vs a one size fits all shopping experience where it’s one price for everyone and customers simply checkout with a card payment.
Operationally, there was quite a bit of industry-specific functionality missing. The way B2B sales work in the drinks industry is rather different than say selling candles or bracelets DTC. Whether that’s certain integrations to niche service providers in the drinks space or being built around the workflows Good Things needed as a brewery.
The other fundamental reason revolved around the buyer experience. This is where using ‘single-player mode’ platforms fall down when it comes to the drinks industry. Particularly when you’re looking at the bigger picture. Your typical independent pub or bar is ordering regularly from 10-20 different suppliers. For bottleshops, this could easily be 100+. When we spoke to publicans about the idea of having 10-20 different logins for each supplier and going to 10-20 different websites to do their weekly ordering, we were met with blank stares.. Imagine the look of outright disgust from the bottleshop with 100+ SKUs.
Bison Beer - Hove
Needless to say, it was a challenge to get busy trade buyers ‘bought in’ and break their existing ordering habits via phone calls and emails which left us back at square one.
In our early market research, we also came across the likes of EebriaTrade. To us, this seemed like an innovative solution built for trade sales which we put in front of the guys. While the marketplace model solved the issue of having to have lots of different accounts for each different supplier, it wasn’t the holistic solution that Chris had in mind to streamline 100% of his trade sales. While it was good for listing a handful of products and generating some incremental sales, the vast majority (80%) of their sales were ‘direct’ phone calls and emails. The idea of funnelling their sales over to a platform like Eebria was a non-starter for a few reasons.
Firstly, they still couldn’t personalise the experience for their trade buyers. How can you personalise pricing or payment terms when you don’t know who’s ordering?
But more importantly, they, and many other breweries we’ve spoken to since, didn’t want to lose their relationship with their trade customers. The orders that come through are faceless. You don’t know who’s ordering, how much they’re ordering, or if they’ve stopped ordering. If someone has stopped ordering, you can’t pick up the phone to see if everything is okay. Just like with any middle-man, it’s not in Eebria’s interests to share this data with you given their business model relies on opacity between suppliers and buyers.
Lastly, Eebria like many ‘middle-men’ charge a commission and they didn’t want to lose 12%+ of their margin on their existing customers and orders.
After 100s of conversations with drinks brands and pubs and bars, we realised Chris was right. There wasn't yet a solution to streamline a brewery’s entire trade sales process so we set out to build one. The industry needed a platform that gave suppliers full control over their own platform and where they still owned and maintained a direct relationship with each of their customers, but where buyers had one place they could go and easily do their weekly ordering from each of their suppliers in a matter of clicks.
Piece of cake right? We’re 2 years into our journey, working with 200 brands and now over 10,000 trade venues but we still see where we’re at today as the tip of the iceberg. There are still a hell of a lot of exciting challenges to solve with our community of suppliers and buyers.
If you’re a supplier who wants to join us on this journey while streamlining and growing your trade sales operation - let’s talk.
If you’re a trade buyer who wants a simpler way to handle your weekly ordering (direct with your suppliers) all while discovering some of the coolest drinks brands in the UK, you can set up your free account here.