Why Consider Online Ordering?

The decision to implement an online ordering system is, first and foremost, a business decision. From ownership to the sales team to back-office workers, everyone must be on board to successfully transition to an online solution. That being said, distributors must decide which solution providers they will work with and which solution they will present to their retail customers.

There are generally four types of solutions distributors can utilize for online ordering. Solutions offered by their Route Accounting System (RAS), third parties, major brewers or a distributor can invest in and build their own custom online ordering platform. As with any decision, each option has potential benefits and challenges a distributor must be aware of prior to making a decision. Additionally, ONE solution may not be the answer, and a distributor may choose to opt for multiple solutions. Below we will briefly discuss each solution type as well as provide links to some of the BIECC Associate Members who offer online ordering platforms:

RAS-Provided Solutions

Distributors know that selecting the right RAS provider for their business is a critical decision. RAS providers are depended on by distributors for managing nearly every aspect of their business, so it only makes sense that they would also be there to assist with online ordering. Each major RAS provider has invested in creating an online ordering solution for their distributor customers.

The benefits of working with a vendor so familiar with your business are pretty obvious. Online ordering platforms offered by RAS companies seamlessly integrate and flow into your existing systems and cause little to no disruption to your current operations. In general, retailer recruitment and transition over to RAS-provided solutions is a responsibility that falls on the distributor since RAS vendors are not actively recruiting retailers onto their solution.

For more information on RAS-provided solutions please visit the sites of our BIECC Associate Member companies below:

• Encompass DSDLink
• eoStar
• Vermont Information Processing (VIP)

Third-Party Solutions

In this instance, third-party solution providers are companies specializing in offering an online ordering platform for retailers to place orders through their distributors. These businesses work closely with retailers to sell the benefit of online ordering and aim to work with each distributor in a market so the retailer can see all products available to them on a single platform. Platforms like Drizly have had great success with this in the business-to-consumer model where they connect consumers seeking local alcohol delivery with various retailers.

Third-party solutions have a variety of benefits to offer. First, these solutions already have an existing retailer userbase in place, reducing the burden on distributors to drive adoption. Additionally, third-party solutions offer an aggregated marketplace where they can search across multiple distributors’ portfolios. Third-party solutions also specialize in working within the three-tier system and are accustomed to working with most RAS and complying with state-specific laws and regulations.

When considering a third-party solution, make sure their software is compatible with your RAS and that it can handle unique pricing and geographic distribution territories for various brands you carry.

For more information on third-party solutions, please visit the sites of our BIECC Associate Member companies below:

• Provi
• SevenFifty

Brewer-Provided Solutions

In an effort to assist their distributor partners in making the transition to online ordering, some brewers have built and offered their own online ordering platforms that their distributor network can use.

Distributors can feel confident that a brewer-offered solution will offer top-notch training and education materials and ample marketing and promotional offerings to assist in signing up retailers. The BEES solution, provided by Anheuser-Busch, is able to feature the entire portfolio of brands a distributor carries and is not limited to only the brands produced by Anheuser-Busch.

For more information on a brewer-provided solution, please visit the BIECC member company site below:

• BEES Platform (Anheuser-Busch)

Distributor-Built Solutions

Another option available to distributors who may not be content with any of the previous options is investing in and building your own internal online ordering platform. Building a solution allows you to customize every aspect of the platform including, the search functions and results, the pricing and what the retailer sees about each product.

While custom solutions can seem daunting, there are base platforms like SalesForce and Episerver a distributor can use to assist with building. This doesn’t mean a distributor would not need to make a sizeable investment to create their own solution, and it will still require frequent maintenance and updates once up and running.

To see a few examples of solutions built by distributors, please visit some of the sites below:

• Reyes Beer Line
• Andrews Distributing Shop Beer

Questions to Ask Before Determining Your Strategy

As with any decision, distributors must do their homework and ask the right questions before deciding on what solution is best for them. Some suggested questions to ask potential partners are:

• How much will the solution cost?
• Will this solution integrate seamlessly with my existing system, or do I need to invest in any other software or hardware to help the integration? How will the integration of systems work in the future?
• What level of analytics reporting does the solution provide?
• What security best practices are followed?
• Where/how is the storefront hosted?
• Will my retailers be comfortable using the platform?
• Are online payments an option on the solution?
• What features do my customers need within an online solution (i.e., past AR, business analytics, current and future pricing, promotions, marketing collaterals, order deadlines for future delivery dates)?
• Will my sales team view this as a benefit, and does it create efficiencies for our sales structure? Do they have visibility into their e-commerce customers’ orders, and do they have the ability to audit and edit those orders?
• Does the platform help market my brands and help us reach our company sales goals?

Decisions to Make Before Determining Your Strategy

Similarly, distributors need to make some internal decisions themselves before committing to a solution provider. Some decisions distributors need to make are:

• What level of pricing do we want to be featured on an online platform? Do we want retailers to only see frontline pricing, or do we want all discounts and promotions featured online?
• Which employee(s) in my operation are going to manage the online platform? How will each department be integrated?
• How will the current sales team be included in the process, and how will we respond to an issue such as a mis-keyed product order or incorrect quantity?
• What other information do we want to provide retail customers on the platform to create additional efficiencies for our company (i.e., delivery days, invoices, etc.)?
• Do we want to link payment processing to your online portal?

Conclusion

As was said at the start of this section, transitioning to online ordering is primarily a business decision, but the technology and the solution you work with do matter. Please take the time to learn about all of your options and evaluate which makes the most sense for your business.

One major consideration should be that the correct answer is not necessarily to implement just one solution. Implementing one solution does not mean you should not consider another. As discussed above, each solution offers different benefits, and it may prove necessary to work with a few different solution providers to best serve all your retail customers. Each distributor knows their business, their market and their customers better than anyone, so they’ll also be the best to know which solution or solutions make the most sense for them.

Identifying the best retailers to transition to online ordering and getting them excited about that transition is critical to implementing a successful solution. Many distributors have found the earliest success in the on-premise channel, but each market is different, and quite a few distributors have had a smooth transition with off-premise adoption as well.

Communication with and training retailers is the key to a successful implementation. Below we have some sample education tools and collateral that was shared with retailers. Distributors have also learned that there is a difference between getting a retailer to sign up and getting them actually to start placing orders. Follow-up and even walking them through their first few online ordering experiences is a best practice shared by several distributors.

Once again, when considering any potential incentives for a retailer to adopt online ordering, please consult your legal counsel as well as your state association to make sure you are not violating and pricing or trade practice laws.

• What accounts do you start with?
  • On-premise accounts generally seem to be the most logical starting point for most distributors, followed by independent off-premise accounts.
  • Some distributors tested with their pre-sell accounts but quickly made their solutions available to all accounts, both on-premise and off-premise.
• How do you communicate this change to retailers?
  • What information needs to be communicated to the retailers:
    • How to sign-up
    • What information they need to provide
    • A brief synopsis of some program benefits
    • Distributor employee contact information for where to direct questions/inquiries
  • Sample Communications:
    • Email blast/retailer newsletter
    • Brochures/educational printouts from sales representatives
    • Invoice copy/headers
    • Direct sales flyer to suppliers
    • Flyer to Account 
    • B2B Onboarding Tutorial
    • How to videos
      • https://www.youtube.com/embed/fRtPJjVckwM
      • https://www.youtube.com/embed/2RrmEb-XF9o
      • https://www.youtube.com/embed/aSe68P7KxWU

• How to prepare retailers for the transition/what do you need from them?
  • Messaging is important: Get retailers excited about online ordering
    • Reassure them that this does not change the level of face-to-face service
    • Provides retailers with additional value-added sales and support on top of sales representative
    • Live demonstrations are available for training
• Possible retailer incentives:*
  • Potentially offer a discount on the total ticket for their first/second/third orders placed (i.e.,1%, 2 ^½%, 5% discounts)
  • Potentially offer first access to limited allocation/release products

Online ordering will likely not be the solution for all of your retailers. Distributors must identify those who will benefit the most and who will embrace this new ordering method. Once you get their interest and sign-up, you must follow through in making sure they grow comfortable using the platform, browsing inventory and purchasing products. Once they place several orders and see how smooth the process is this will become their new normal way of doing business. Additionally, it’s important to constantly communicate with your retailers to share new enhancements the platform has to offer as well as reminding them of the benefits available to them while using the system.

Implementing an online ordering solution is an investment in time, training and money for beer distributors. While providing more options to retailers is important, distributors also want proof that online ordering is beneficial to their bottom line and makes good business sense. For that reason, it’s important distributors know what metrics they should be tracking and should set criteria by which they can define success.

Below are some examples of metrics measured and tracked by distributors who have successfully implemented online ordering solutions. Additionally, for some web analytics listed, a distributor may consider asking the solution provider to offer the data to assist with understanding online consumers and what is and is not working.

• Setting and measuring goals
  • Number of retail accounts registered
  • Number of retail accounts ordering
  • Increase/decrease in distribution and volume with registered accounts
    • Sales: CEs shipped, revenue, margin per CE
    • Sales by customers same above containers
    • CEs shipped by SRS trade channel vs. prior year
    • Customer logins
      • Frequency
      • Amount of time spent on the platform
    • Retailer satisfaction/complaints
    • Increased sales of lower-volume products
    • Sales personnel time saved
  • Web analytics – Items to potentially ask from a third-party solution provider
    • Sales by volume and $ by product
    • Units ordered by product
    • Out of Stock Rate (OOS)
    • Search keywords by frequency
    • Customer segment: independent vs. chain, on-premise vs. off-premise, restaurant vs. bar, type of restaurant or bar
    • Detail Page Views (DPVs) per product
    • Average Order Value (AOV)
    • Alternative purchase behavior (consumers that looked at your product but ended up purchasing this other one)
    • Cart abandonment rate
    • E-commerce orders vs. overall orders
    • Site metrics:
      • Website traffic
      • Category traffic
      • Active/inactive users
      • New/returning users
      • Device type (mobile, desktop, etc.)

As previously mentioned, some of the benefits of online ordering systems are time savings for your sales personnel and increased visibility for your entire product portfolio. Those two items should be among those which you benchmark and track throughout your conversion to online ordering. Each distributor will value and measure different aspects of online ordering, but the important part is to make sure you are not just integrating online ordering because it seems like the necessary thing to do. Set goals and evaluate success just like you would for any new product launch.

Perhaps the most significant determining factor in whether or not an online solution will be successful is how you prepare internally for a transition to an online ordering system. New roles and responsibilities are going to be required. Sales personnel need to be communicated to early and sold on the fact that an online solution is being implemented to complement their efforts and not to replace them. Data in your back-end system needs to be cleaned to ensure it is accurate and up-to-date. And finally, the entire sales staff needs to be trained on the new solution since, in most cases, they will be the ones called upon to train and work with retailers who are being onboarded. Below please find some suggestions, best practices and samples to assist in your internal onboarding efforts.

Cleaning Item Data and Retail Account Information

Distributors have grown accustomed to their back-end systems and current ways of taking orders. However, since the content in your back-end systems will be used to populate a retail ordering website, the data must be accurate and complete. Solution providers will assist you with this, but it will also take a lot of work with your back-office staff. The same holds true with your retail account information. If you ask an account to start placing online orders, you better make sure you have all of their information correct in your system, so their order links to the correct account.

Hopefully, one tool that will help a great deal regarding item information and imagery is the recently launched BIECC Master Product Catalog (MPC). The MPC’s goal is to serve as a single source of accurate, up-to-date brand information and imagery for all brewers’ brands. Access to the MPC is freely available to distributors, retailers, vendors and other industry stakeholders. The aim is to keep numerous individual industry members from keeping and maintaining their own item catalogs that may or may not be fully accurate.

• Cleansing/Preparing Product Data
  • Make sure product statuses are accurate in your system (seasonal, discontinued, active, etc.)
  • RAS/ERP file maintenance needs to be scrubbed:
    • Fresh images that “pop”on a web ordering platform
    • Pricing/promotionsneed to be accurate for all products
    • Sell dates must be accurate
    • “Live” inventory if possible. You want retailers only to see in-stock and available products
    • Readable product descriptions
      • Sometimes product descriptions make sense in a back-end system, but not to a potential buyer. Make sure readable and attractive product descriptions are available for all brands.
      • Include as many “value add” product attributes such as ABV, style, tasting notes, etc.
      • Reach out to suppliers directly for any data fields that are not available from the Master Product Catalogue (MPC)
    • Retail Account information
      • Makes sure you have correct names/DBA’s of all your accounts in the system
      • Make sure liquor license information is updated
      • Collect all of the relevant names, email addresses and contact numbers for individuals who will be placing online orders from your retailers
      • Order minimums and delivery quantities
    • Be sure to set up your product territories – especially if your footprint is not the same for every brand you sell. You do not want retailers to see brands they cannot order from you.

Communicating with and Training Employees

Securing the buy-in of employees is imperative to making the transition to online ordering successful. This includes sharing the benefits of a new solution with your sales team and identifying early on what new roles and responsibilities need to be filled in the back office. Below please find some suggestions and examples of employee communications around online ordering.

Another sometimes successful tactic in securing buy-in is offering employee incentives to adopt the new solution. When considering any possible employee or retailer incentives, please first consult your legal counsel or state associations to determine whether you are able to offer such incentives in your state.

• How to communicate with and prepare employees for the transition:
  • Distributors will often create presentations or even tutorial videos to share with their team to prepare them for the transition to an online ordering platform. Here is an example of a presentation one distributor shared with their sales team as part of an online ordering system rollout.
  • How do you re-train/educate your sales representatives?
  • Business-to-business (B2B) does not replace the sales team but is an INVESTMENT by the company to make the sales team more effective.
    • More time to sell and discuss more value-added opportunities with the retailer
    • Opportunities for direct marketing to retailers
    • Simplifies administrative tasks (invoices, past orders, etc.)
    • Customers can order on their schedules
    • The sales team still reviews orders and are imperative to the process!
• Incentives:
  • Employee incentives to sign up accounts –
  • Some distributors have begun offering incentives to sales representatives for each account they sign up that places orders through the online ordering system. A common number seems to be $3.00 per account. But keep in mind, it’s important not just to reward sign-ups if those accounts never start using the platform.
  • The sales team still gets a full commission on online sales
• What new responsibilities are needed? Roles and responsibilities to consider when starting B2B:
  • A “captain” to connect all of the pieces and manage the overall implementation
    • You must establish a main point of contact for both internal and external inquiries
    • The “captain” needs a skill set with technical expertise as well as firsthand knowledge of sales and operations and strong communication skills
    • IT or technical staff must ensure all elements are working correctly once a solution is rolled out (RAS integration – discounts, items, etc.)
    • Implementation is only the beginning. There will be continued refinement of B2B tools
  • All sales personnel will need to continue recruitment of accounts and usage. This is not a one-month promotion only and must continue with all new accounts that open in your market.
  • The need to have full-time management of product statuses in your RAS will be more important than ever (discontinued and new products, seasonal products, etc.)
  • Customer service will be critical, especially during the launch, to do onboarding demonstrations and address technical issues for both internal team members and retail customers.

Whether it’s a new product rollout or the transition to new software, employee buy-in is critical. Employees will have questions about online ordering systems, and there will be new roles and responsibilities needed in the office for it to be a success. Preparing staff early, investing in educating your team and communicating frequently can help make the transition smoother.