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Beer pricing as clear as a Rocky Mountain spring

This article appears in the issue March 2000 [Volume 9, Issue 2]

Coors distributors link

There's more to pricing beer than resetting the pricing gun. Just ask Bob Peterson, senior manager of Enterprise Intelligence with Coors. Distributors must be notified of every price fluctuation, holiday promotion or market demand, and they pass that fluid information on to the many retailers.

With more than 600 independent distributors, what was historically a manual process became very time-consuming. The pricing sheets were sent by fax to the distributors or each was called directly by phone.

"It's been less than efficient and with a lot of room for error," said Peterson.

A single retailer might see 3,000 to 4,000 price changes per month.

"We call on a lot of major retailers for announcing promotions," Peterson said.

Those added pricing tasks were taking salespeople out of the market because they had to spend time collecting data. In response, Coors has been working with its distributors to implement an automated data collection and pricing information network. Data is now collected, processed and sent to retailers electronically.

A distributor need only log on to the site to get a report on pricing specials at individual stores or throughout the distribution chain. Security controls are in place to ensure that distributors only see the retail pricing for their own products.

According to Peterson, the system, which was provided by ViaLink, handles not only Coors products, but additional products each distributor carries. Coors paid for the set up, and distributors pay ongoing fees.

ViaLink addresses the retail problems of price book synchronization, invoice discrepancies and write-offs. Retailers and suppliers can exchange product, price and promotion information electronically by sharing an Internet-accessible database.

Because product information is exchanged over a single interface, suppliers can use EDI or simply log on to a Web site and key in the information. That eliminates the time required to work out specific formats with each trading partner.

With half of the network now on the system, Peterson called the system "semi- optional" for the remaining distributors.

"The goal is to have 500 distributors ViaLink-enabled by May 2000," he said.

Once fully implemented, Coors expects all levels of the supply chain, from manufacturer to retailer, to see greater results. The system will allow Coors to approach retailers with all pricing on a single sheet that comes from distributors.

"This gives us a competitive advantage going to retailers," Peterson said.

"We're kind of blazing the trail," he added. "This is setting the stage for the digital economy in the beverage industry--historically not very technology-savvy. This model will serve our industry very well.

"We're looking for other ways to leverage it. There's a lot of other potential."


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