$1950* per tap EVERY YEAR! Here’s how…
Of course there is a * after that figure. Every business is different and every tap has a unique business relationship behind it. All we can do is talk in averages, so here’s how we got to that number…
|Tap consumption:||1 keg every 2 weeks|
|Sale price of a keg of craft beer:||$300|
|Tap Churn (Loss) rate:||25%|
|Kegs required to service tap:||7|
Industry averages from industry publications, bodies & market research*
So, a tap will sell approximately $7,800 beer per year ($300 * 26 fortnights)
Lost sales due to tap loss per year: $1,950 ($7,800 * 25%)
Lost sales due to tap loss per year per keg: $278 ($1,950 / 7)
Of course, if your taps sell more beer this cost will increase rapidly.
This is simple maths, but often it is the simple things that get overlooked. Often tap loss is hidden, because it is more of a ‘churn’. Taps are lost and taps are won, so at any one time a brewer has roughly the same number of taps they service. The cost of gaining new taps (time and money) is absorbed across new and existing taps. But this is just another way to hide the true cost of losing taps.
It gets worse, because this also ignores the fact that a new tap will generally cost 5 times as much in marketing costs to make a sale as an existing tap, and take about 6 months of effort to achieve, costing you both money and time.
The good news is…
Tap loss is easily preventable!
90% of tap loss is caused by 2 issues:
- The tap runs dry – Friday night, the drinkers are ordering, and the venue finds out someone forgot to place their order & they are out of stock. Disaster. This is the main cause of tap loss. Venues wont let the tap sit idle not making sales, so they put a competitors beer on tap, and just like that you’re out…
- A competitor gives a better deal – Sales reps know a venue is most susceptible to trying a new product when they are almost ready to order a refill of stock. They lure the venue away from your beer with a great introductory offer, and you’re left out in the cold…
(the last 10% of tap loss is made up of a mix of venues going broke, new management, personal dislikes, and so on – we call these ‘inevitable’)
How how can you eliminate 90% of tap loss?
- Never let a tap run dry
- Know when customers stock levels are low
- Know when to make a sales call to customers
- Schedule deliveries more efficiently
- Predict future demand by beer and plan production
- Know how fast a venue consumes your beer
- Learn the trends by beer for each venue
- Know when kegs are ready to collect
- Offer customers better value
Value isn’t just about lower prices, it’s about offering customers more for their money. With KegLink™ you can offer a premium service and gain a competitive edge.
- Freshness guarantee – monitoring the freshness of your beer in trade gives you a competitive edge over others
- No more annoying sales calls – sales calls are only annoying when they aren’t necessary. By knowing when customers need to order, you ensure they welcome your calls.
- Don’t let a tap run dry – Dry taps lose venues money. When you solve this problem, you become an integral part of their business.
KegLink™ gives you all the tools you need to keep your tap contracts and grow your business