the following is a case study on a ferment-house beverage company I made up for a class on Supply Chain Management, called Good Brews. There sure are a lot of resources out here. Anyone have the resource of time and shared dreaminess want to work on this model with me? Leave a comment or send me a message!
Shaelee Evans, May 9, 2017
The Olympic Peninsula produces a bountiful array of grains, fruits herbs and sweetness. Through an unofficial Keiretsu, area farmers, a tea company, a fish-monger and a brewers guild bring together the pieces necessary for an Olympic Peninsula Cooperative Ferment House. That’s Good Brews. May we ever make tasty libations of the peninsula, for the peninsula.
A community can use the vehicle of a corporate organization of a craft brewing company to preserve harvests, increase local revenue and improve the quality of life and physical health. This can be done through a collaborative business model with an efficient and direct local supply chain. Goods can be produced in a low impact way that encourages healthy lifestyles and makes good brews of otherwise lost or wasted resources.
Suppliers and Supply Chain Mechanics:
Raw materials: Horizontal and Vertical Integration
Good Brews is supported by a collaboration of many community partners, including the farmers that will barter their grains, hops, herbs and fruits and the Port Angeles Brewery supply that supplies the processing agents. This is horizontal integration as it creates long-term relationships with the producers and community groups that provide the raw materials that make our Good Brews truly newsworthy. Using production facilities located on in-network-managed farmland is a form of vertical integration. We can produce our own hops and many of the fresh herbal flavoring agents and fruits that make things interesting.
Additionally, there is a marriage of these integrations through using our licensing and infrastructure as well as our orchards to make wines for brandy production. We utilize the overabundance of local fruit and create a concentrated high value product that in its delicious collaborative production truly is a spirit of the olympics. We can use our licensing and infrastructure will gleaned fruit harvests of the Olympic Peninsula for wines to make brandy, and local grains for beers.
The difficulty in this method is that we have to adjust our recipes to what is seasonally available. However, that is really more of a puzzle, science project or adventure. The breadth of knowledge we have from combined experiences “brewing locally” will be awesome as we get around the table to compare notes and plan seasonal offerings.
Production: Keiretsu Networks The North Olympic Brewers Association and in-network organizations is our source for workers, many bartering for ingredients, products, experience and bragging rights. Good Brews doesn’t own any of the land that is so vital to its working, but has a vested unofficial partnership and strong collaborative relationship with the landowners. These are both Keiretsu Networks in that they are longterm relationships in which we benefit each other and act as a coalition on many things, but keep our financing and management decisions distinct, trading and producing within the network. Our symbiotic intention in farmland, facilities and labor gives our production stability and increases quality. Additional labor can come through those already form of payroll through in-network companies.
Clallam Canning Company (Port Angeles) and Goodness Tea (Sequim) demonstrate this sort of relationship through crafting drinks that combine Betsy’s delicious shrubs (herbal honey vinegars) with Shaelee’s tea blends that are sold at the local year-round Port Angeles Farmer’s Market. Their businesses both benefit from the promotion, the market from increased local offerings, and the consumers from a beverage option that is not only tasty, but locally sourced and therapeutic to their body system. With more focused planning, we could offer more drinks to highlight other area producers, and thus increase local sourcing and production in the region. There really only are only benefits here.
The potential disadvantages would be that a key aspect, like our main farm or bottling/packaging facility, would be rented to someone else. However, were that to ever be the case, there are ample locations we could relocate the HQ to on the Olympic Peninsula. If the North Olympic Brewers Association ceased its partnership, we could work on forming another community group with that purpose or use the model we have created and incorporate like employee benefits into our employee kick-downs.
Packaging: Transactional Relationships. Packaging is an area where we always want to push the edge of what is possible. Our present “new” options rely on glass, a diminishing resource. For new materials, we source through Specialty Bottle in Seattle and other connections through the Brewers Guild. For end-use product, sell primarily in re-usable steel kegs, and for consumer production we use reclaimed beer and wine bottles. We allow locals to drop off at our facility and will be working on collaborating directly with Waste Connections to have a sign on their glass recycling units letting locals know that we are here and will use their unbroken bottles. For packaging our secondary retail items, we use Elevate packing. Their ethic for sustainable development is great and we are happy to turn to them for sourcing petri-plastic alternatives for our in-house uses.
These transactional relationships change over time, and are constantly open to redefinition. Being open to many suppliers gives us the ability to lobby for more sustainable options. New technologies may produce a responsible glass alternative and other manufacturers and supplies will likely arise with other plastic-esque options. A transactional relationship for this aspect of our supply chain is the best way to allow for the flexibility to jump to new more-sustainable packaging solutions.
Shipment: Horizontal Integration Wild West is an Olympic Peninsula based business that supplies local fish and wild-harvested goods to restaurants and retailers on the peninsula and in the greater Seattle area. Our drinks require the same refrigerated trucks their fish and produce do, and we have the same clientele. This horizontal integration is a long-term relationship, where our individual expertise and assets can utilize similar channels to strengthen both our brands. Their existing route can be made more desirable desirable through the addition of Good Brews, as well as more efficient with a fuller truck. Our low-cost rate (from using their existing route and excess van space) results in higher profit margins for both our ventures.
Resale & Consumption: Horizontal and Vertical Integration We sell directly to customers through booths are area Farmer’s Market booths and at seasonal events, as well as through our mother companies catering opportunities, this is vertical integration. The relationships we have with independent regional grocers and other retailers, like bed-and breakfasts, is horizontal integration. They provide us with a customer stream and we do in-store/in-house demos, provide exclusive product and provide special pricing.
There is great benefit in multiple revenue streams. Even moreso, having some vertical integration allows for Good Brews to have good profits, while the horizontal and trade-based integration keeps us connected to and imbedded in our community. The drawback to these methods are that we don’t get to feel like a big company available at all the major retailers. But we’re okay with that.
Thoughtful sourcing aimed to utilize local resources, including Olympic level camaraderie, to their highest potential yields a great diversity of blessed results. We are able to have an extremely efficient supply chain in all areas: the procurement of raw materials, through local farmers; the production of goods, through skilled training and support of our area brews guild; with packaging, through reusing and reclaiming glass bottles and steel kegs; through shipping, by jumping on preexisting routes; and through resale by selling directly to the consumer.
The supply chain is like the transfer of nutrients from the root hairs of a plant up to the stomata in the leaf. As they move up through the xylem, they provide the the plant with the minerals it needs to grow. The stages in the flow of goods affect the end product, and a healthy process results in much fruit. Similarly, we choose supply-chain partners from our area and who also participate in a generous sharing economy. We want them to grow with us, and together we can distill our bounty into something worth talking about.
About the Author
Shaelee Evans began studying permaculture in 2005 through implementing practices on her 1-acre farm in rural NW Washington. She studied Sustainable Gardening through the WA State Nursery and Landscaping Association (cert in 2003), and Natural Resource Management and Business at Peninsula College (graduating with an AS in 2006 and a BS in 2018). She has taught workshops on forestry, wild plants, pruning, art, cooking, dance and sustainable land management, working as an active horticulturalist on the Olympic Peninsula since 2005. Presently she is also herb farming and tea blending in Sequim Washington for Goodness Tea, a company she founded in 2008. The vision is to cultivate and grow teatime culture based on healthy community, fueled on hand-crafted herbal teas and superfood snacks, with a supply chain that blesses everything to the moon.
Boundless. (Date accessed: 2017 May 09). Transpiration aids in the movement of water and minerals in the xylem, but it must be controlled in order to prevent water loss.
Retrieved from: https://www.boundless.com/biology/textbooks/boundless-biology-textbook/plant-form-and-physiology-30/transport-of-water-and-solutes-in-plants-183/movement-of-water-and-minerals-in-the-xylem-698-11923/
Inside Supply Chain Management. (2012 March 13). Horizontal Collaboration - Sharing Supply Chain Assets with Your Competitors. Retrieved from: http://www.supplychainbrain.com/content/nc/general-scm/single-article-page/article/horizontal-collaboration-sharing-supply-chain-assets-with-your-competitors/
Online Extra. (2009 Oct 16). Keiretsu. Translated literally, it means headless combine. Retrieved from: http://www.economist.com/node/14299720
Sourcing Innovation. (2006 August 13). What can we learn from Keiretsu?. Retrieved from: http://sourcinginnovation.com/wordpress/2006/08/13/what-can-we-learn-from-keiretsu-strategic-supply-management/