Inventory is Key to Controlling Craft Beverage Cash Flow

inventory is key to controlling craft beverage cash flow

Many craft breweries and craft beverage companies are stressed over cash management. Even companies that maintain pristine control over cash flow drivers, like capital equipment expenses and labor may be missing the mark when it comes to inventory. Although taking advantage of product volume discounts seems like a wise financial decision, it’s a waste of resources if the supply expires on the warehouse floor…it can also deprive your business of cash at just the wrong time. At CanSource, our low minimum orders ensure right-size batch runs for your beverages and continued cash flow for your company. 

Crafting Through COVID (and beyond)

At the onset of the coronavirus pandemic, 46% of craft breweries predicted they would be forced to close. Fortunately, a lot of companies avoided this fate by adjusting their business models to maintain financial strength. Many that relied on tap rooms full of customers to keep the cash flowing, switched to curbside pickup and delivery. Others began canning their crafts and partnered with retailers to keep sales afloat. The one thing all surviving breweries have in common, though, is a reduction in wasted resources.

Once the threat of COVID-19 is gone, the lessons learned shouldn’t be forgotten. Efficiently managing your company’s cash flow comes down to properly protecting your resources. Running with a lean inventory – enough product on hand to fulfill current and near-future orders – is the best way to avoid tying up your cash in pallets stuffed in storage.

Unused inventory costs 25-30% more than its actual value.

Just-in-Time Inventory Management

The JIT strategy involves ordering and storing just enough inventory for sales, on an as-needed basis. The JIT process is quite effective at improving ROI and reducing overhead by:

  • Lowering inventory storage costs
  • Increasing efficiency
  • Reducing waste

There are many benefits to using JIT including eliminating the need for an enormous warehouse to store pallets of products. Plus, companies that like to switch out products quickly, relish the ability to test at smaller volumes without committing to full-fledged shipments.

The CanSource Advantage

CanSource is your just in time can sleeve partner! We understand that storing inventory raises costs and uses resources that provide no value to your customers. That’s why we offer small batch runs and low minimum orders. Not only a great solution for seasonal, experimental, or specialty batches – but a smart way to manage your company’s most essential resource – cash.

If you’re ready to give just-in-time inventory management a try, feel confident you’re partnering with a company that fills your can-needs from four facilities strategically located across the U.S. Our team of can sleeving experts looks forward to providing you with exceptional service. Contact us to learn more.