The Beer Industry Prepares for the Blockchain Based Supply Chains
Apart from being the main food for many cultures for years and years, beer is also one of the world’s most popular drinks. From paddock to pint, the set of systems and processes are undertaken to present you with the best taste for the frothy cold brew.
Similar to other supply chains, the beer industry supply chain is also a complex one, with its own issues and challenges. The outbreak of pandemic was one of these issues and would continue to be for a great time. Post pandemic, the evolving pressures would disrupt the beer supply chain in 2021 and even continue to do so after that. The supply chains also need to be flexible and adaptive to the challenges that lie ahead.
Brewery software technology enables the process to be connected along the entire supply chain, right from the concept to sales and financial reporting using linked hardware and brewery software systems. Future trends would see breweries embracing the Internet of Things (IoT) such as RDIF tagging, GPS monitoring of shipments and sensors to automate beer production.
Role of Blockchain in Beer supply chain
What is the beer supply chain?
The beer supply chain consists of crucial steps taken from the starting point of recipe conception to production, brewing, bottling and delivery to the consumer. The journey from field to the fridge including raw materials such as malt, hops, and yeast in addition to people, production activities, information and resources involved in getting a beer into the hands of the consumer.
Undoubtedly the beer supply chains are complex and consists of a number of stakeholders that include growers, brewers, distributors and retailers. Contemporary supply chains are based on direct-to-consumer models that was made possible through a growth in e-commerce and hold a great importance in the times of pandemic.
Processes of Beer Supply Chain
Every supply chain is based on two important factors-supply and demand, but as mentioned before, beer supply chains are more complex and so is the brewing process. Here is a flow chart depicting the beer supply chain:
The process starts with raw ingredients that are necessary for production & packaging and is ended when beer is delivered to the end user.
The raw materials, as we all know, consists of essential items such as water, malt, hopes, beans, spices, sugar and twists on traditional brew. It is estimated that almost 39 million hectares of barley are harvested in 2019. Out of which, almost 70 percent was used as animal feed while the other 30 percent or 11,817 hectares was used to produce beer.
The main challenges here are the reducing social moisture and draughts exacerbating water shortages, climate change that pose a real threat to the availability of raw materials.
Beer production has always been a labor-intensive task, especially in smaller craft and boutique breweries. Brewery software and many software-as-a-service platforms offer breweries a real-time solution to improve efficiency of the beer production. Software solutions many times replace manual methods of inventory tracking to provide better access to management tools.
Introducing automation in breweries can reduce the stress of manual tasks like temperature checking and a single output cooling valve. More complex and well-designed automation systems are extremely flexible, enabling brewers to edit new recipes.
The demand for craft beer has led to a growth in corresponding beer packaging market. Beer packaging is a crucial part of beer supply chain that involves the packaging, labelling of bottles, PETs, cases and kegs.
The beer packaging market is very competitive and appears to be fragmented. There is a strong competition when it comes to price, capacity, volume and quality. The popularity of demand for original packaging solutions is expected to stay the same way and is likely to impact the market considerably.
Dispatch & Distribution
Beer supply chains need to be backed by a strong and efficient shipping and logistics. Batch tracking with the help of brewery software tools enable product monitoring to determine the status of all inbound and outbound deliveries to the warehouses. Ensuring timely deliveries and customer stock replenishment.
Distribution covers a wide range of activities and a number of supply chain participants. Quality auditing, marketing, training and food pairing are all distribution activities. Participants in beer supply chain vary from wholesalers to retailers, restaurants, bottle stores and clubs.
Distribution of the supply chain is vulnerable to unpredictable customer, and ever-changing preferences. The beer supply chain was adversely affected in 2020 due to Covid-19 pandemic which caused nation-wide lockdowns, the closure of hospitality venues and restrictions on social gatherings.
The pandemic has changed the ways in which beer is packaged and distributed. This situation has certainly given rise to e-commerce, online demand and direct-to-customer supply chain due to whole nations being forced to stay at home. Brewers had to change the entire packaging to meet the demands of changing times.
Covid-19 has been extremely disruptive to the supply chain of beer products and this is likely to linger. International markets will dry-up as Covid-19 outbreaks continue to shut down countries and more virulent strains emerge.
Here is where Blockchain based supply chain enter the scene.
The advent of Blockchain:
Blockchain is a secure database that records a product’s journey and ensures everything stored on this ledger is immutable. Due to the tamper-proof nature of Blockchain, this technology is being popular these days. Using this technology, McCarthy explains that the producer can include as much or as little information as regulatory possible.
Consumers are more interested in learning about the origin or source of the raw materials, and the ethical footprint and sustainability of the products they buy. This is mainly true for craft beer enthusiasts.
Blockchain technology in beer industry provides the end-users with the ability to trace and track information about where the barley is reaped and brewed. This supply chain is achieved by simply scanning the QR code on a pack of beer. Blockchain trials have been introduced to collect data. This would provide the information to consumers and also help the agricultural development such as improving the grower’s barley yields and environmental footprint.
Blockchain brewery software provides a decentralized platform to enhance traceability and gain valuable data on raw ingredients. ‘Fairfood’ uses Blockchain techn0logy to trace food items to their source, enabling farmers to gain better prices and employs better wages. The technology also enhances billing transparency with the help of transaction of transparency and expediting the flow of capital and maintaining security.
New technologies expand very quickly. Same is the case with Blockchain technology. Blockchain was initially rolled out as a crypto technology, but owing to the immutable and tamper-proof nature of the technology, it has expanded to many other industries. Blockchain in beer industry is a relatively new concept, but the implementation of this tech in the food and beverage industry is a long known process. The biggest use-case for Blockchain in majorly every industry is its power to disrupt the supply chain while ensuring traceability.
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