Why your favorite beer is out of stock and how to fix it.
WASHINGTON (September 1, 2021)—COVID-19 has disrupted logistics and supply networks all over the globe, making it trickier than ever for products to be stocked and sold in an efficient and timely manner. Most industries continue to adapt to this new normal by modernizing their logistics networks, but the alcohol industry continues to labor under a host of rules that prevent it from implementing basic practices. It is time for policymakers to update these laws and allow the alcohol industry to truly harness the power of logistics.
In a new policy short, R Street senior fellow of competition Jarrett Dieterle explores the modernization of many supply chain networks in comparison to that of the alcohol market.
While most industries continue to revolutionize and experiment with new logistical strategies to ensure that products make it to the hands of consumers in the most efficient way possible, the alcohol industry’s three-tier system and other rules prevent the sector from employing many cutting-edge logistical reforms. Basic practices like centralized warehousing or transshipping products from one retail outlet to another are actively prohibited for the alcohol market.
Policymakers need to prioritize updating these laws so that the alcohol industry can harness the power of logistics and avoid unnecessary supply chain disruptions in the “new normal” of COVID-19.
As Dieterle notes, “At a time when sophisticated logistics and the ever-relentless drive to create supply chain efficiencies are taking commercial markets by storm, alcohol remains stubbornly mired in the past. As COVID-19 continues to force policymakers to re-think supply chain integrity, a good place to start would be to allow the alcohol marketplace to realize the efficiencies of modernized supply chains.”
Read the full piece here.
