Behind the Scenes of the Beer, Wine, and Spirits Supply Chain

A Conversation with Michael Colucci, Director of Business Development at East Coast Warehouse

In this edition of our interview series, we spoke with Michael Colucci, a seasoned professional in the logistics and supply chain industry, who specializes in the beer, wine, and spirits vertical at East Coast Warehouse.

Michael shared his insights on the unique challenges and considerations involved in handling, storing, and transporting alcoholic beverages, as well as the innovative solutions and value-added services that East Coast Warehouse provides to its clients. We also learned about the advantages of being located in port-centric overweight zones, the benefits of temperature-controlled warehousing and transportation, and the importance of compliance with industry standards and regulations.

Michael, thank you for joining us today. Could you start by telling us a bit about your role and responsibilities at East Coast Warehouse?

Sure. I’m the Director of Business Development at East Coast Warehouse, and I focus on the beer, wine, and spirits vertical. I sell the warehousing, drayage, and transportation services that we offer to importers and distributors of alcoholic beverages. I have experience on both sides of the table, as I used to work at Heineken USA before joining East Coast Warehouse.

What are some of the unique aspects and challenges of handling, storing, and transporting alcoholic beverages compared to other products and industries?

Well, there are a few key points that make alcohol different. The first one is the licensing and regulation. We need certain permits and certifications to store, handle, and transport alcoholic beverages, and these vary by state and local jurisdictions. We also have to comply with federal regulations, such as the FDA and the TTB, which is the Alcohol and Tobacco Tax and Trade Bureau. So there’s a lot of paperwork and compliance involved in this sector.

I see. And what about the physical characteristics of the products? How do they affect the logistics process?

Another factor that makes alcohol different is the weight. Most alcoholic beverages are heavy and liquid, which means that they can’t fill up the container to its maximum capacity. They hit a weight limit before they use up the dimensional space. So it’s really about maximizing the weight of the handling and the transportation. This also affects the loading methods, such as palletized, slip sheets, or floor loaded, and the equipment that we use to handle the products safely and efficiently.

And what about the temperature requirements? Do alcoholic beverages need to be stored and transported in a temperature-controlled environment?

That depends on the type of product and the customer’s preferences. Beer is generally ambient, meaning it doesn’t need any temperature control. Wine and spirits sometimes have a temperature requirement, especially for the higher-end products. They may also require a climate-controlled environment, where we monitor the humidity as well as the temperature. We currently don’t offer that service, but we do have different temperature zones in our warehouse facilities. We have ambient, which is around 70 degrees, controlled ambient, which is 65 degrees, and cold, which is 40 degrees. We have alcohol stored in all of these zones, depending on the customer’s needs.

How do you ensure the integrity and quality of the alcoholic beverages during storage and transportation, especially concerning temperature control and pest management?

We have several measures in place to safeguard the integrity and quality of the products. First, we have inbound and outbound inspection procedures, where we check the freight for any signs of damage or compromise. Next, we have mechanical key performance indicators (KPIs) that continuously monitor the warehouse environment, ensuring a consistent temperature and humidity level. We also have a diligent cleaning staff that maintains the cleanliness of the floors and the rack systems, ensuring a pest-free environment, as well as quality assurance protocols that are ingrained in our operations, with constant evaluation and cleaning throughout the day. All of these measures operate around the clock, ensuring the continual preservation of product quality.

East Coast Warehouse has locations in port-centric overweight zones. How does that help with the cost-effective and rapid deployment of containers and outbound orders?

Location is very important in our business. Our buildings are strategically located near the ports, which allows us to haul up to 90,000 pounds gross vehicle weight. This is a big advantage for our customers, because they can save about 20% on their ocean costs, drayage costs, and inland transportation costs by maximizing the weight of the container. Otherwise, they would have to ship less volume and more containers, which would increase their costs.

Another benefit of being close to the ports is that we can mitigate the risk of demurrage and per diem charges, which are the fees that the terminals charge for containers that sit for too long. These fees can be over $300 per container per day, so they can add up quickly for high-volume shippers. By being close to the ports, we can turn and pick up the containers faster than other providers and use our equipment more efficiently. We also have a large yard where we can store the containers until we receive them in our warehouse, which helps us protect them from freezing in the colder months and avoid any delays or penalties.

Can you tell us more about the facility layouts that support indoor rail siding capabilities? How does this service benefit your customers?

Absolutely. Our Jersey City facility has an active rail siding operation, which allows our customers to ship rail directly into our facility. This means that we have a railroad track inside our building, and the rail cars come in and get pulled in by the rail handler. Our warehouse staff then drives the forklift onto the rail car and unloads the product.

This service is very beneficial for customers who ship cross-country or to remote locations, as it can save them a lot of time and money compared to trucking. For example, our current customer fits 75 pallets on a rail car, and their average load weighs over 180,000 pounds. That’s roughly four times the weight of a truckload, so for every one rail car they ship, they take three trucks off the road. This also reduces the CO2 emissions and the environmental impact of the transportation. The only downside of rail is that it requires more handling and quality blocking and bracing, as there is more jostling of the freight during transit. But we have the experience and the equipment to handle that safely and efficiently.

Q: What are some of the value-added services that East Coast Warehouse provides to its customers in the beer, wine, and spirits sector?

We provide a range of value-added services to our customers, such as repacking, copacking, and special projects.

Repacking is when we repackage damaged products or salvageable products into new cardboard boxes. We have the cardboard on site, and we can repackage the products quickly and cost-effectively.

Copacking is when we create variety packs or holiday packs for promotional purposes. We can individually grab the bottles or cans and put them in a new box or display, according to the customer’s specifications. Special projects are when we need to fix a quality defect or a labeling issue, such as correcting the best-by date or the production code. We can re-sticker bottles or cans if needed to make sure it complies with the customer’s standards and regulations.

We also offer a keg return solution, which is a new service that we’re launching soon. This service allows us to pick up empty kegs from local distributors, empty them, and send them back to the foreign brewery or manufacturing plant, where they can be reused. This service helps our customers save money and reduce waste.

How does East Coast Warehouse ensure compliance with industry standards and regulations, such as the Safe Quality Food (SQF) certification? Why is this important for your operations and your customers?

Compliance with industry standards and regulations is paramount in our operations. We have the necessary warehousing and trucking permits and certifications to handle and transport alcoholic beverages in all the states we operate in. We also have the SQF certification, which signifies the highest food safety standards in the industry. This certification requires substantial investments in maintenance and upkeep, and regular audits by external clients.

We also have dedicated food safety managers and a rigorous cleaning regimen to ensure adherence to standards. Our commitment to food safety is further bolstered by our advanced technology systems, such as our Warehouse Management System (WMS) and our Transportation Management System (TMS), which provide comprehensive visibility and traceability of all our transactions. We can comply with any recall or audit requests, and we can also integrate with our customers’ ERP systems, such as SAP or Oracle, through API or EDI. All of these measures ensure that we maintain the highest standards of quality and safety in all aspects of our operations, which is crucial for our reputation and our customers’ satisfaction.

Finally, can you share any notable success stories or case studies where East Coast Warehouse provided exceptional support for beer, wine, and spirits companies?

Of course. We have helped many alcohol importers over the years, and there have been some instances where we had to overcome some unique challenges or provide some innovative solutions.
For example, we had a customer who had a quality incident where the production facility put the wrong best-by date on the bottles. We had to sticker every bottle with the correct date, and we did that in a short period of time, which helped the customer salvage the product and avoid any losses.

Another example is when we had a customer who had a huge volume surge, where they received 50 containers in one week, instead of the usual four. We were able to handle that spike in volume, thanks to our location, equipment, and yard space, and we helped the customer avoid any demurrage and per diem fees, as well as any delays or penalties.

Another example is when we had a customer who needed us to create a variety pack for a holiday promotion. We had to individually grab the bottles from different production codes and put them in a new box, according to the customer’s specifications. We did that efficiently and accurately, and we helped the customer increase their sales and market share. These are just some of the examples of how we provide exceptional support for our customers in the beer, wine, and spirits sector.

We hope you enjoyed this interview with Michael Colucci, and learned more about the behind-the-scenes of the beer, wine, and spirits supply chain.

East Coast Warehouse is a premier provider of temperature-controlled logistics, with a specialization in the food and beverage sector offering a comprehensive end-to-end solution for clients, handling everything from drayage and warehousing to copacking, repackaging, and outbound transportation. ECW also offers innovative solutions, such as indoor rail siding and keg return.

East Coast Warehouse continues to be a trusted partner and an integral extension of its clients’ operations, fostering trust and reliability.

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