After extensive analysis of the beverage delivery environment, the results indicate the process of delivery can become complex, revealing the necessary interfaces required from the sources of supply to the delivery destinations ― and ultimately the customer.
Delivery conditions are so varied and dependent on specific physical capabilities at sources and destinations that calculating a delivery cost can become a major on-going concern. Therefore, from an operations perspective, calculating delivery cost should follow the steps of the supply chain to iterate physical capabilities, limitations, impacts and interfacing necessary among sources and destinations to determine costs under realistic and changing conditions.
Although most categories of beverages have different types of sources, traditionally packaged products will be ordered from producing plants, warehouses or distribution centers employing a variety of transport vehicles.
When ordering beverage packages is initiated, these issues demand interfacing of quantities, delivery times, locations, account type and methods that contribute to the total cost. These issues are the keys to effective supply chain execution.
Vehicles are a prime cost in the delivery cycle and selection can depend upon route distances, geographic conditions, order quantities, account type and available physical capabilities at location. In addition, driver/salesmen using the various vehicles might be trained and paid to operate accessory equipment employed in particular delivery environments to cope with conditions. These issues represent many of the interfaces that start cost of beverage distribution.
Destinations present another array of interfaces that could have an even greater impact on the cost of beverage delivery. Although vehicles are a prime factor, the environment at various destinations indicates the importance of analyzing the significance of cost impacts that are realistically involved in most delivery situations.
Unloading areas can be standard docks, drive through warehouses, walk embedded elevators or just city walks/streets. These physical areas must interface with the vehicle assigned to accommodate servicing accounts to realize efficient and timely delivery.
The unloading areas will vary according to the type of account being served, which brings another factor into the cost equation. On-premise accounts such as bars and restaurants, and off-premise accounts like supermarkets, convenience stores, drug stores and gas stations must be interfaced not only with the vehicle but also the delivery conditions at each location.
Several other factors that must be interfaced with physical conditions, vehicles and type of account are distances per route, geographical obstacles, delivery time and order quantities, which all contribute to cost. Of these four factors, geographical conditions and delivery times could have a significant variable cost impact that might not be controllable depending on the type of account. Distances traveled and order quantities can be controlled and/or negotiated to alleviate some transport expense and minimum order policies can help increase tonnage along the delivery route of the supply chain.
The delivery cost of beverages is indeed a complex and difficult project when attempting guidelines or benchmarks for accurately evaluating any bottler’s or distributor’s supply chain activity in real time terms.
