I am pleased to annouce that Beverage Business Builders has joined the CBA (Craft Beer Attorney) list of prefered providers. Most of the providers are located in Southern California. Each and every member of the network has been personally vetted by Candace Moon and displays the same kind of committment to craft as I do. . There is everything from an insurance agent to branding experts. I am so impressed by Candace's committment to "craft" in the business space. Everyone has his or her pick of service providers in just about every niche of craft brewing. It is nice to work with people who care about the beer almost as much as the brewer does.
Beyond Brewing Quarterly Newsletter
CBA publishes a quarterly newsletter called "Beyond Brewing". The December 2015 is the latest edition. i would encourage you to download the entire newsletter. It has helpful articles on California law changes, like the "parking lot party" (extending wine privileges to craft brewers. This will allow breweries to host parties at the brewery. It also will allow breweries to participate and sponsor in events conducted by and for the benefit of non-profits. There are also helpful articles on laying the groundwork for distributuion, merchandise marketing, 2015 tax considerations, brewery safety and much more. There are so many topics that touch the business of craft brewing. It is nice to see it reflected in one place.
Lot Tracking, You Can't Manage What You Don't Measure
My article on inventory lot tracking was featured on the second page. It is an expanded discussion of my blog post from November. Here is the text of the article.
Lot tracking is the secret to understanding the inner workings of your inventory. It allows you to understand the age and, in some cases, the chemistry (ie. malt and hops) of the specific items. Anyone who has worked with me knows that I'm a big fan of lot tracking. You can get so much more information when you hold your inventory in your system by the lot number. Lot tracking is used all throughout the brewery; from raw materials to finished goods (Don't forget glass. Boy, is it nice to know if you have a defective lot of empty bottles!)
It is Required by Law
Not only is it a good idea to understand what ingredients went into what batch of beer, the law requires it. The Food Modernization Act of 2011 gives the FDA the ability to subject all breweries to Current Good Manufacturing Practices (CGMA). This means that "breweries in the United States are required to manufacture, label, document and store products in compliance with CGMP".
Lot tracking sophistication grows as the brewery grows. In the beginning, you may just keep a paper record of the lots. But once the brewery is packaging a significant amount of beer, the cost of potential inventory track mistakes begins to add up. To properly track inventory, a brewery must track the item, quantity, and warehouse by lot number. That is a lot to keep straight, but it will provide a clear picture of what you have at any given moment. There are many systems out there that can track inventory at this level (OrchestratedBEER and QuickBooks Enterprise come to mind). Lots need to be tracked as raw material is received (usually the supplier will mark each bag with the lot number). Then lots need to be noted on the brewsheet with each batch of beer. All brewers grumble at the extra columns on the brewsheet, but those extra few seconds that it takes to jot down the lot numbers will allow the system to tell you what raw material made which batch of beer. The brew number typically becomes the batch number and will carry through to packaging. If you are consistent with tracking batches, then you can run a BACKTRACE report. That is a fancy word for tracking any component that went into a specific batch of beer. It makes recalls really easy and fast. If you are facing a recall, you want it to be easy and fast. I’ve seen cases where beer needed to be recalled due to the shipment of a bad lot of malt. It is much better to pull a few kegs from stock, than to pull all of the kegs out in the marketplace.
Date Coding is Key
Marking the lots on finished goods allows you to ensure that the cooler is rotating properly. Improperly aged beer is bad for everyone. It is important to know the age of the stock in the cooler at all times. Date coding the individual finished goods allows you to remove old beer in the marketplace. If you don’t want to show actual packaging dates, you can use a Julian calendar or your own calendar. The important thing is that you (and your salespeople) can read the date code.
Mary Brettmann is the President of Beverage Business Builders, an accounting and administrative firm dedicated to craft brewing. She has four years’ experience in craft brewing administration, two of which as a CFO in a regional craft brewery. She can be reached at www.bevbizbuilders.com.