Helping alcohol brands grow through fulfilment

In this article, you will find valuable industry data and advice on how to achieve success and thrive by implementing scalable alcohol fulfilment.

  • $1,609bn
    Revenue in the alcoholic drinks market 2023
  • 5.4%
    CAGR until 2027

Is alcohol the ultimate crisis-proof category? It has certainly demonstrated its resilience in recent times, enduring both the pandemic and the cost of living crisis – and quite probably helping customers endure these tough times too!

The alcohol industry is valued at $1,609bn globally, with the market expected to grow annually by 5.4% until at least 2027 (1), driven in large part by the continued rise of D2C online alcohol sales models, which have enabled a new wave of product innovation in the category.

Savvy alcohol brands consistently seek new ways to delight customers as well as tap into changes to consumers’ lifestyles to ensure they’re always able to serve up the right drink for the right occasion. Here are a few of the trends we’ve been following closely at Huboo.

1 According to consumer and market insights portal Statista.

D2C in the mix

D2C-based alcohol selling now sits alongside the online marketplace model as a mainstay for fast-growth alcohol brands. During Covid, people spent far more time online than ever before, becoming familiar with the D2C model as they sought out their favourite titles at a time when on-trade destinations were forced to close their doors and many people were reluctant to shop in physical stores.

The convenience of D2C is massively appealing to alcohol customers, particularly those with consistent consumption habits who know exactly how they like their cabinet stocked. This has led to a rise in subscription-based sales, as well as curated product bundles that bring an element of discovery to the customer experience.

Of course, brands cannot rely on every customer to keep up with their purchasing frequency in these testing economic times. We’ve seen more and more agile alcohol producers packaging up eye-catching incentives to keep customers loyal in recent months, through discounts, bulk buys and other promotions – something that’s far easier to achieve via D2C where brands aren’t forced to pay any commission to third-party marketplaces.

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Key factors to take into consideration include storing products in zero waste warehouses, taking a plastic-free approach to packing, a paperless approach to picking and offering greener shipping services – for example, by using hybrid and electric vehicles and route optimisation software – to ensure deliveries are as carbon efficient as possible.

It’s important to remember that the sustainability ethos extends to people working in fulfilment too. Many warehouse roles are incredibly physically demanding, repetitive and involve employees walking long distances to locate products, all while being timed and monitored, which can lead to intense stress and strain. This is why brands need to choose fulfilment partners that treat their people well, for example by taking health and safety seriously, operating flexible hours and encouraging regular breaks.

We’re not like other fulfilment companies. Talk to a fulfilment expert to learn more about our human-centric model.

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3 From consumer research by drinks market analysis firm IWSR.

Increased diversification as category boundaries blur

People are switching between beverage options with increased frequency, as well as showing greater willingness to try completely new types of drinks – from hard seltzers to craft beers and canned cocktails (4). In fact, almost one-third (30%) of alcohol brands said they plan to launch exploratory products in the next two years to capitalise on the growing appetite for experimentation and unconventional new taste sensations (5).

With loyalty no longer such a safe bet, brands need to step up their innovation credentials to retain their place in such a jostling and vibrant category. Logistically, however, this means many more SKUs to manage and keep track of, more potential for confusion and delays to creep into the picking and packing process, and of course, the possibility of frustrating customers if problems occur once the order has been placed.

Capable warehouse management systems are essential if these issues are to be avoided. It’s not about haphazardly piling products up to the rafters in vast warehouses, but more about using smaller, self-contained hubs to easily store and manage multiple SKUs, all belonging to one brand, all in one accessible space.

4 According to IWSR research.
5 From Global Drinks Intel research.

A balancing act between luxury and discount products

People may be watching their wallets, but this doesn’t mean they are immune to special occasions, or to treating themselves. The premium alcohol category has performed strongly over the past few years, echoing similar lifts in wellbeing and health-focused products, where discerning consumers have shown a willingness to pay extra for better quality goods.

During the pandemic, many drinkers sought to create ‘affordable luxury’ experiences in their own homes, spending more on spirits and sparkling wines, in particular, to welcome in the weekend. In fact, home mixology continues to grow from strength to strength, driven by the FOMO and excitement of Instagram and TikTok cocktail-making content, a major reason why premium spirits are forecast to increase their global market share to 13% in 2024 (6).

However, consumers have limited resources to spend on non-essentials, so outside of these luxury consumption moments, they’re proving perfectly content to purchase discount brands for everyday indulgence – creating opportunities for more affordable market entrants and challenging everyone priced in the middle of the category to do more to differentiate their offering.

Whatever the price of your product, and whether you’re selling premium spirits or low-alcohol sparkling wine, your fulfilment needs to be treated with the same care, accuracy and attention, ensuring that every customer is left satisfied with the online purchasing experience, as well as the drink in their glass.

6 According to IWSR research.

Is it better to offer discounts or luxury options?
When it comes to alcohol fulfilment, the key is to provide a flawless experience for customers.

Achieving fulfilment success:
Eight simple rules for alcohol brands

If you’re an alcohol brand that sells products via multiple channels such as online shops and marketplaces, you’ll soon discover that as your sales increase, the storage, packaging and shipping of your items can quickly feel overwhelming. So, what’s the solution? Here are eight simple rules to help you achieve fulfilment success for your brand.

Keep your fulfilment journey simple

Simplicity is key to a fruitful fulfilment journey, even if your brand sells via numerous channels. When a customer places an online order, whether via your website, a marketplace, or a social media platform, it should automatically feed through to your warehouse team. The chosen vessels – whether they contain beer, wine, cocktails or spirits – should then be carefully picked, scanned and dispatched on the same day to ensure prompt delivery and a first-rate customer experience. A reliable system will also update your stock levels so you’ll never sell a product that’s not available while alerting you when stocks are running low.

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Consider outsourcing some or all of your fulfilment operation

The logistics journey for your offering is likely to be complex and hard to keep track of without the right support, particularly if you’re selling multiple variations of an alcohol-based product that must remain compliant with rigorous government and HMRC regulations. Outsourcing this time-consuming process to a trusted fulfilment partner will enable you to save money and focus on other key aspects of your brand, safe in the knowledge that your customers are privy to a seamless, satisfying service.

And don’t simply accept a one size fits all approach to fulfilment. Your fulfilment partner needs to understand your specific requirements and create a bespoke plan that will best serve your business and its plans for growth into new territories and marketplaces and subsequent increasing order volumes going forwards. This is particularly important in selling alcohol, where each new territory may bring a raft of further regulations to consider.

For example, at Huboo our Continuous Improvement Team analyses all client processes to optimise the service we provide, working in tandem with operations, finance, supply chains and future projections departments to identify untapped opportunities and make improvements. This enables the team to fully collaborate with you throughout your Huboo partnership to guarantee scalable growth while maximising efficiency.

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Make sure your fulfilment is flexible

A frictionless fulfilment process affords brands the time to be more agile as new consumer drinks trends – and subsequent commercial opportunities – emerge. You need to be able to react quickly to meet sudden spikes in customer demand and, while this will inevitably pose challenges to inventory planning, this can be overcome if you’re using software that offers real-time insight into omnichannel sales and warehouse inventory levels. Assessing current sales data alongside historic data makes it easier to spot patterns and ensure that you aren’t left with expired or leftover products once a spike has passed.

This is equally important to bear in mind when preparing for peak-season eCommerce events. A fulfilment provider needs to have the tools and account managers in place to meticulously forecast orders so that warehouse teams can flex in size to serve different needs across various marketplaces while making sure there is unlimited scalability to order volumes with zero breakages or customer complaints. This includes detailed knowledge of key annual periods for alcohol, such as the summer months, bank holidays, Christmas and New Year, as well as being able to predict other one-off events that might lead to an increase in sales, such as the Royal Coronation.

On the flip side, your fulfilment also needs to be flexible enough to adapt when things don’t go to plan. Whether it’s industrial action, an economic downturn, supply chain issues or a product recall, you need to work with your fulfilment provider to ensure that there are clear contingency measures, with your provider able to act as an extension of your brand and communicate what’s happening to your customers.

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Take storage seriously

Your warehouse should include dedicated, premises-licensed storage areas for alcohol products so that they leave in the same condition they arrived. Not every warehouse will be up to spec. You need to make sure you have clean, temperature-regulated ambient spaces and, of course, that your valuable products are kept out of direct sunlight and, preferably, in a cool, dark place so they don’t lose any of their flavour, colour or potency over time.

In addition to this, your fulfilment provider needs to demonstrate that it has batch control, stock checking and quality assurance measures to ensure products don’t exceed best before dates. This is particularly important in the case of perishable products or those that contain organic ingredients. One example of best practice is adopting a first-in-first-out method so that older products are picked, packed and shipped as a priority, minimising the risk of waste and items reaching expiration dates.

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Ensure your packaging is on point

Unboxing is the first physical interaction that your customers have with your product. So it’s vital that customers experience products and packaging as per your instructions and, crucially, without any damage or breakages, particularly when it comes to transporting glass bottles.

Sustainable, alcohol-specific packaging, protective insulation materials – such as Flexi-Hex – as well as appropriate-sized boxes and fragile stickers are all helpful when it comes to achieving this. Some fulfilment providers can even meet more targeted packaging requests so that alcohol products arrive complete with a sample, branded note or other marketing collateral.

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Store your products in the best possible location

Brands need to consider the optimal locations for getting products out to customers effectively. Geographic proximity means faster, more cost-effective and more environmentally friendly shipping, so try and choose a fulfilment partner that has a proven presence in the locations that matter most to your business – and that can boast easy access to major transport networks, allowing for cohesive and effective distribution further afield.

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Offer optimum delivery outcomes

A good delivery experience encourages customers to order again. But this doesn’t always mean the same or next day. Customers want high levels of service at a reasonable cost and transparency throughout the fulfilment process. In a nutshell, they want to know where the item is, when they can expect it and a guarantee that it will arrive at the time stated when they made the purchase, all from alcohol-compliant couriers who make the effort to ask for age verification.

In addition to this, customers are becoming more eco-conscious, so it’s important that you’re fulfilling orders in a way that’s as sustainable as possible. Alcohol brands can clearly demonstrate their ESG credentials to customers when they have the relevant accreditations in place.

As part of this process, fulfilment providers should have teams dedicated to achieving relevant industry standards. This isn’t merely a box-ticking exercise, it ensures that your products are managed, fulfilled and delivered – from eco-friendly warehouses – with integrity.

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Set clear KPIs and sales targets

KPIs and sales targets are more than just numbers and metrics. They help you to understand how a fulfilment provider is performing and the impact of this on your business. Putting KPIs in place with a provider will allow your partner to make continuous adjustments to achieve your strategic goals faster. This is why at Huboo we adhere to a clear service level agreement that has the potential to yield the best possible customer experience. Our SLAs include 99.9% picking accuracy, same-day order dispatch and returns processing as standard.

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Success Story:
Shaking up the traditional spirits market with Au Vodka

With a premium product range at its fingertips and a winning fulfilment partner on board, Au Vodka’s business has gone from strength to strength over the past few years, achieving a hugely successful launch into Europe and now planning for its hotly anticipated venture into the US. “We’ve become the fastest-growing alcohol brand in eCommerce, and Huboo has played an important part in this growth story”.

Read the full Success Story here.

Service quality is our number one priority and we recognised the advantages of using third-party fulfilment to ensure accurate and speedy picking, packing and shipping at all times. We spoke with Huboo for months before signing up. What we saw during this time was an amazing level of commitment shown by Huboo towards its clients’ customers, which gave us the confidence that Huboo was the right fit for Au Vodka.

Jordan Major

Head of eCommerce at Au Vodka

Your brand can be our next Alcohol Fulfilment Success Story.
 
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Our key alcohol partners in profile

Our ever-expanding pool of strategic partners exists to maximise the growth opportunity for your alcohol brand, giving you access to new marketplaces across Europe and globally, plugging you into innovative new technology solutions, and providing best-in-class guidance and counsel to solve emerging strategic, regulatory and operational concerns as you grow.

The eCommerce market is constantly evolving, but by aligning with a carefully curated selection of ERPs, marketplaces, eCommerce channels, social media platforms and other software applications, we ensure we’re always best placed to meet your commercial needs. Our key alcohol partners include:

Brightpearl by Sage – a retail operating system that’s built for hyper scalability. Brightpearl offers the functionality to keep up with ever-evolving consumer expectations, with its wide range of purpose-built integrations across operations, forecasting, data and analytics. Brightpearl also seamlessly automates the inventory planning function for businesses, ensuring that you always have the right products to meet demand, particularly during those trickier to predict peak season events.

MTC have award-winning B2C / D2C client eCommerce online shops, they have vast experience and expertise in the alcohol industry. Working with a wide range of brands such as BrewDog, Tiny Rebel, Scotch Malt Whisky Society and Glasgow Distillery they have delivered both world-class online and digital strategies as well as multi-million-pound eCommerce online shops. Their track record of working with some of the fast-growing drinks businesses in the UK puts them in a unique position to be able to provide advice, guidance and execution to deliver their client’s goals.

Packhelp makes it easy for anyone to order fully custom-branded packaging. It connects customers with the most suitable production possibilities, offering them a broad range of packaging products from mailing boxes and kraft tape to tissue paper and product boxes. Packhelp covers everything from local deliveries of small quantities to global procurement of large volumes, with Packhelp Studio – an online editor for small businesses, instantly purchasable products and orders from 30 pieces, and Packhelp Plus, which helps mid-market companies scale their packaging needs.

Huboo: where it all started

We emerged six years ago on a mission to revolutionise eCommerce by creating a more efficient, simpler and more transparent approach to fulfilment and logistics.

We’ve taken the traditional warehouse format and transformed it into smaller, more scalable service-led hubs, where each area – and every product placement – is optimised by tech. Since then, we have continually refined our hub model, which massively reduces the distance walked by warehouse teams, driving efficiencies and cost savings, and allowing us to put people – and a personalised approach – at the heart of our fulfilment proposition.

Our 700+ strong team has a wealth of alcohol industry expertise, having partnered with a host of brands – from household names such as Carlsberg to innovators and category disruptors like AU Vodka – to help them successfully scale their businesses.

Today, we offer a higher quality, dynamic and competitively priced service offering with a UK and European fulfilment model that has a global reach. This is carefully tailored to eCommerce alcohol brands of all sizes and categories and is underpinned by a human-centric approach to customer service, end-to-end fulfilment operation technology and a commitment to continuous improvement in everything we do.

United Kingdom
Netherlands
Spain
Germany

How we do it

People

We’re not like other fulfilment companies. Our empowering company culture means that our staff are passionate about delivering our goal – enabling your alcohol brand to grow. Within our warehouses, we replicate the processes that occur in traditional fulfilment in more controlled, manageable spaces. Dedicated hub managers and in-house beer, wine and spirits (BWS) specialists understand that your customers will have made a considered purchase from a brand they trust and can successfully communicate your requirements to all departments across the business to ensure you get the wraparound service you deserve.

Technology

Our bespoke, tech-driven operational solutions integrate with all major sales channels, giving your brand access to a host of potentially untapped markets, while allowing you to manage your entire inventory from a single platform. It’s more reliable this way because we’re in control of every element and stage in the fulfilment process. Our strategic approach to fulfilment is perfect for all types of alcohol SKU, while we accept a minimum of five orders per day. Our solutions can help alcohol brands of all sizes, while you can be safe in the knowledge that our certified, zero-waste hubs are underpinned by a world-class Warehouse Management System.

We provide you with real-time order and inventory data and accurate tracking, alongside customised reports that include buying habits, sales metrics and customer insights which help to fuel your business growth. We also have a fully integrated and automated returns management system in place, saving you processing time and providing clear reporting and full visibility on the status of all returns.

Growth

We’re only successful if you are too. Whether we’re supporting new product categories, adding sales channels or helping you break into new markets, we’re here to help our customers grow better and faster. From our technology to our warehouses, to our people, we channel our expert in-house knowledge to help your business expand in the right way, at the right time and in the right places.

Bonded warehouses

Our excise duty suspended warehouse means that alcohol brands can defer the payment of excise duty and VAT on their products, rather than paying all duties prior to the arrival in the warehouse. By using our excise warehouse, alcohol producers free up cash flow by only paying duty to HMRC once items are dispatched.

They also reduce the red tape involved in processing duties, with Huboo’s team of beer, wine and spirits (BWS) experts able to log and declare all removals from the warehouse to HMRC on the producers’ behalf and provide answers to any complex excise duty-related questions that brands might pose. Huboo can advise alcohol brands on their own HMRC licensing and compliance requirements.

This means that Huboo’s warehouse offers a compliant storage solution for all alcohol products, ensuring they hold their value for longer, while Huboo has batch control and quality assurance measures in place, ensuring that products do not exceed best before dates. Warehouse staff are able to respond to alcohol orders with 99.9% accuracy, resulting in faster deliveries, while ensuring minimal breakages and a seamless returns process. The warehouse also has the capability to release alcohol bottle by bottle, rather than just per case, or at the pallet level, making it ideal for bespoke eCommerce orders. This approach frees up time and resources for alcohol brands to focus on other aspects of their day-to-day business. right places.

How our approach helps emerging alcohol brands

We ease the complications that fulfilment brings with it, effortlessly integrating with the alcohol industry’s most popular sales channels and marketplaces. We do this by harnessing cutting-edge technology, in tandem with people who care, to enable a more productive fulfilment network.

We also let you monitor every stage of the fulfilment process, in real-time, from your Client Dashboard. Our intuitive platform gives you the power to track your goods, manage transactions, monitor sales and listings by each channel, carry out quality control inventory and keep on top of costs. We provide full visibility of where your valuable stock is at every step of its lifecycle.

Equally, we recognise that a one size fits all approach doesn’t suit every alcohol business when it comes to couriers. That’s why we only offer you alcohol-specific courier options that are capable of handling age-restricted products and that have proven age verification processes and, in return, you’ll receive Huboo Express rates. We have clear pricing, fair terms and don’t charge for setting you up with the right courier for your needs, nor are there any unexpected charges for integrating with your existing sales channels and systems and the same goes for storage.

In a nutshell, we’ve got everything in place to help you reach more customers on a global basis and grow with confidence.

How we extend this approach
to larger alcohol businesses

We transform multi-million-pound turnover alcohol brands into digital commerce market leaders by deploying customised solutions that are forward-thinking and future-fit. This means that they can adapt to the speed and scale that large businesses demand, in turn driving efficiency and growth, while staying loyal to each brand’s ethos, values and heritage. We build and manage our own technology because it’s more reliable that way and allows us to remain in total control of your products at all times. Our technology also speeds up ongoing operational processes and brings greater clarity to the status of every order. We can also tailor it in a way that maximises exposure to your alcohol brand, taking full advantage of our extensive partnership network. Our team of 50+ software developers is on hand to support, update and innovate, harnessing their tech know-how to make sure you stay ahead of the curve.

This includes developing and creating tailored integrations that drive efficiency and growth, such as automation and targeted reporting. As soon as you sign up, we assign you a Hub Manager whose goal is to look after your brand. They do this by ensuring the smooth running of your dedicated hub while providing exceptional customer service and dealing with any unforeseen or unexpected issues as and when they might arise. In addition to this, you will be supported by a specialist BWS business development manager or enterprise sales manager who makes it their mission to understand your business and explore the best ways of working alongside Huboo.

We then let you manage your entire inventory from a single dashboard and observe aggregated data across all your eCommerce channels, territories and customers. Simply put, our insights empower your decision-making, by letting you know which sales channels are delivering, how product lines are performing and everything else you need to keep growing your business.

We don’t franchise our tech model, meaning that whichever warehouse your customers order their alcohol products from, the quality will be exceptional and consistent, and you’ll have lower packaging and posting overheads on account of the expert fulfilment methods we incorporate into our supply chain solution.

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How we extend this approach
to larger alcohol businesses

We transform into digital commerce market leaders

We help you adapt to effective growth

We let you manage your inventory from one place

Discover how we can help you grow