Unveiling the Complexities of Wine Distribution Today

The wine business is unique because it involves high customer-specific pricing, even though every sector needs pricing flexibility. This includes unique "quantity break" pricing necessary when a buyer "breaks" a case to order a few bottles rather than a whole case, as well as specific promotional offers and discounted prices.

FREMONT, CA: The wine industry has a complicated supply chain that presents daily challenges for wine distributors. Wine distribution is becoming more complex. Here are some common issues in the current wine industry:

Tracking Wine Rotations

In the wine business, every lot or batch number is called a "rotation," and each cycle involves important dates such as "use by" and "best by." Rare or vintage wines may also have a "not before" date. To distribute wine correctly by date, distributors must track these dates.

 Distributors must also keep a record of which clients received which cycle, and if a recall occurs, they need to know which rotations are impacted. Since wine is perishable, inventory management must account for this.

Need for Pricing Flexibility

Wine is unique because it involves high customer-specific pricing, including "quantity break" pricing, when a buyer orders a few bottles instead of a whole case. Distributors need the option to add extended pricing upgrades to their accounting systems since most standard accounting systems cannot manage all price modifications.

Managing Vintages

In the wine industry, a new vintage outperforming a previous vintage is called a "supersession," usually used to characterize fine wines that are always being restocked. When forecasting inventory and buying functions, wine management software must account for the relationship between these two wine vintages. When a customer has been purchasing an older vintage that is now out of stock, there is a good chance that the customer will choose the next available vintage instead. Thus, a mechanism is needed to connect items, allowing a new product to "inherit" all or part of the demand from a prior vintage. This is not always the case in other businesses, where customers frequently switch to a new brand, product, or kind when a current one runs out.r kind when a current one runs out.