Tapped Out: Keeping Beer Fresh from the Brewery to the Fridge
Originally published on Supply Chain X
Despite a strong showing from wine, beer remained the country’s most popular alcoholic beverage in 2017. Like winemakers, however, brewers are confronting some significant challenges to long-established practices, from increasing opportunities for spoilage to competition from upstart craft brewers.
Crack open a cold brew and join us as we walk you through the supply chain of beer, from the brewery to your favorite Saturday night watering hole.
The Basics of Brewing
According to the National Beer Wholesalers Association, American brewers shipped more than 206 million barrels of beer in 2015. With such high demand for their product — especially surrounding holidays like New Year’s, St. Patrick’s Day, and the Fourth of July — brewers need to ensure that suppliers and production facilities maintain open lines of communication at all times to prevent any shortages.
Like many foods and beverages, the raw ingredients of beer originate with farmers. As any connoisseur knows, beer is brewed with water, malt (from barley), hops, and yeast, in addition to other additives like spices, fermented sugars, fruits, or even seasonal flavors like pumpkin. At the brewery, these ingredients are mixed together in large kettles in a process that can take as long as twenty hours for a single vat of beer.
Once the beer is brewed, it’s ready for canning or bottling, labeling, packaging, and shipping — all of which which usually happens at the brewery itself. The completed product is then transported to local pubs and bars, grocery stores, or other retailers for sale (and eventual consumption).
A Need to Be Clean
While the basic process of brewing beer has remained unchanged for centuries, today’s brewers face an increasingly complex supply chain rife with unprecedented challenges. Brewers that outsource elements of production like labeling or bottling, for example, need to consider the precise time and warehouse space saved, the distance from the brewer to the packager, and the distance from the packager to the distributor to determine whether outsourcing production is truly cost-effective.
The greatest challenge for brewers, however, is ensuring that their raw materials are of the highest quality. Recent years have seen an increase in damaging crop diseases like hop mildew, which can derail an entire production cycle. Even after production begins, brewers need to maintaining rigorous hygienic standards to prevent spoilage and contamination from outside agents. Even the slightest overexposure during brewing or an improperly cleaned tank can result in a contaminated batch, ruining the entire crop and severely limiting supply.
Spoilage isn’t just a concern during the brewing process, either. Since beer typically stays fresh for just four months after production, suppliers need to move the product out of breweries, onto trucks, and out to distributors as quickly as possible to minimize the risk of spoilage.
The Rise in Craft Brewing
If it seems like more and more varieties of beer have been appearing at your local grocery store, it’s not your imagination: small craft breweries are proliferating across the country, now accounting for 1 out of every 10 beers sold in the US. In 2015, there were 4,824 reporting brewery facilities in the US, an increase of 14.5% from 2014. What’s more, these craft breweries are beginning to overtake their larger competitors: since 2009, more than 7% of the market has shifted from large brewers and importers to smaller brewers, and in 2014, the craft brewing industry contributed $55.7 billion to the US economy.
Smaller breweries might also have an edge when it comes to supply chain management. Many craft breweries source ingredients locally and distribute their finished product within reasonable trucking distances, keeping their operations smaller and more efficient.
As these startup breweries continue to grow, large breweries have opted for more sustainable brewing practices in an effort to remain competitive with local craft brewers and appeal to consumers (while saving costs). This is good news for beer aficionados: with every pour just a bit greener, you can continue to enjoy a steady (and guilt-free!) supply of suds.