Reach more retailers and make your brand easier to obtain.
UPCs help boost craft beverage sales.
As more and more chains look at craft beer and cider options, making your product accessible to the customer means more than just having enough volume to satisfy sales; it means including the tools accounts need to be able to sell your product. One of the most important tools you need to include in your packaging program is a bar code. But you’ll want to ensure you have the right bar code: a Universal Product Code. Universal Product Codes (UPCs) are one of the most vital pieces of information on your product’s label or carrier. Even today’s small and independent bottle shops are adding UPC scanners into equipment repertoires. Investing in the incorrect bar code can be a critical and expensive error.
UPC scanners are part of the modern-day bottle shop equipment.
GS1 is the highest standard UPC available in the US and the one that is used by all retailers, especially the largest. While there are other varieties of barcodes available to you that smaller retailers can and will use, GS1 is the industry standard. If you want to sell your beverage to a larger retailer, you’ll need a GS1 UPC. While other options may be cheaper in the short term, switching over later can cause long term troubles.
You’ll have to pay for new labels and then notify all of your current retailers of change so they then can change their system. If you’re not set up in time, you can also end up missing out on an important approval at a potentially sizeable new customer. This is one of those occasions when spending a bit more upfront can save you a lot of pain and expense down the road.
As specialty retailers add outlets and larger retailers add more local and specialty footprints and sets in certain neighborhoods, it becomes more and more important for small beverage producers to implement a professional UPC program.
I reached out to my former coworker, Tom Calhoun, who managed our chain accounts and asked him what the biggest mistake new producers make in regards to UPCs: “Not thinking in advance about how far they wish to take their brand. Is it just small format stores or do they wish to go into larger formats? Right now two large format chains, Kroger’s (Fred Meyer’s, Fry’s, QFC, Ralph’s, Food-4-Less) and Walmart, require GS1 Prefix UPC’s (or EAN/UPC barcodes) for scanning (a minimum fee of $750.00 plus an annual renewal fee). Starting out with a cheaper UPC and then finding out you need GS1 UPC’s is a formidable transition since one would already have their items in stores with the old UPC on them.”
A UPC is made of 12 digits. The first part of the UPC is your company’s prefix. This number can range from 6 to 10 digits. The longer your company prefix, the less items you can have. Longer company prefixes also cost less, but allow you less room to grow. Fortunately, if you run out of UPCs, you can purchase another company prefix. However, renewal fees on multiple prefixes can quickly exceed the renewal fee of a larger batch so it might be better to put out a bit extra upfront to buy a larger batch.
The middle part of the UPC, as alluded to above, is the item’s individual identifying number. You will want to make sure you’re sure about the packages you’re going to UPC. If it’s a small production, infrequently released product that mostly goes to bottle shops that don’t care about UPCs, you may want to save the GS1 UPC for a larger release that will get more traction in a variety of retail settings. For example, De Garde Brewing of Tillamook, Oregon, just released two beers to the trade: one with a UPC and one without. Their Petit Desay is a beer they brew and release frequently so it has a GS1 UPC on it. The other release, Grand Rouge, is a rare release of about 100 cases they may not produce again. It had no UPC. The Grand Rouge will sell quickly through specialty shops who don’t care about a UPC. The Petit Desay, which sometimes sees larger releases will reach bigger retailers which appreciate the UPC to make the product easier to handle.
The final number is a check digit that makes sure the previous numbers are correct. Here is a link to GS1 US which shows how to manually calculate the check digit if you’re interested in how the check digit works and is calculated.
It’s best to plan out your UPCs before you actually start using them. For instance, you’ll want to plan two UPCs for a 4- or 6-pack: one for the carrier and one for the bottle label. This will allow retailers to sell both the pack and/or the bottle as a single unit. This is also, I feel, an area that many breweries miss out on when they produce can packs. A lot of retailers don’t want to break up a pack if there isn’t a second UPC and will keep it together. This will limit your sales opportunities. If you’re using the hard plastic can holders, it may be worthwhile to add a sticker to the top with your second UPC so that retailers can sell both the pack of cans and the can as an individual unit.
Seasonals are another area where Tom Calhoun of Kendall’s Pioneer of SW Washington has seen breweries and cideries make mistakes: “In almost every situation seasonal UPC’s should share the same UPC/barcode if it’s the same package configuration (12/22’s, 4/6/12’s, etc.). Every chain wants to see these two things; the same pricing for that seasonal line and the same UPC. The same pricing and UPC allows for easy transition with no requirement to notify the store that the new seasonal is coming in. This allows the distributor to easily rotate the old seasonal into the new since every store doesn’t rotate those seasonal items in the same time frame. Chains will not accept seasonal items sharing the same UPC that have different base pricing, it’s just too problematic. The easier you make it for retailers the better chance you have of retaining that rotating seasonal item.”
Basically, if you have a seasonal line that will have the same price as you rotate through the months, use the same UPC for each seasonal. This ensures an easy transition with no work needed from your wholesaler and your retailers. When you or your wholesaler run out of your winter seasonal, you can just send in your spring seasonal and it’ll scan right in as the “seasonal” sku at the current pricing. No fuss no muss!
This scheme can also work with your more limited releases as long as you are releasing them in the same sized package and at the same price.
Eventually you’ll need to recycle a UPC. You’ll eventually discontinue a package. Why let a UPC go to waste? The biggest thing you’ll need to do is plan and communicate. My best advice would be to let the UPC sit for a while. Of course, there may be times where you’re running low on UPCs and you have to turn it around immediately. You’ll need to reach out to all your retailers and notify them of the change, obviously if it’s the same size package and price this will be an easier notification. If it’s not, be sure to communicate ALL changes to the UPC to your retailers and be sure the retailer acknowledges the changes. If you’re working with a wholesaler, be sure to notify them in advance and consult with them on the most efficient way to handle the change. As with all things in business and life, effective and clear communication is the way to succeed.
GS1 US is THE source for UPCs. They describe their mission as: “neutral and not-for-profit. We succeed when industries and companies derive value from using our standards.” They offer a variety of programs to support UPCs and educate you, the buyer. There are a lot of other sources out there to buy UPCs, but you’ll find that a lot of these are re-sellers of batches they’ve purchased from GS1 US. You’ll have to decide who you wish to go with and how you want to manage the long term development and expansion of your UPC program. If you do decide to go with one of the re-sellers, be absolutely sure the UPCs you’re purchasing are GS1 UPCs. You’d hate to think you’re getting a bargain and end up wasting a lot of time and money redoing labels while missing sales opportunities.
Just be sure to proofread the label proof before you finalize the print job! Then get someone else to proofread it. Then maybe a few more people! You can’t be too careful when it comes to your brewery’s resources, including your new labels or cans. You’d hate to have to redo everything because of a mistake at your label printer! This becomes even more critical when purchasing cans. Thousands of worthless cans is both fiscally and environmentally wasteful. This is an area where the old home improvement adage becomes very pertinent: measure twice and cut once.
Go Forth and Scan
You don’t have to be a big brewery to need UPCs in today’s market. UPCs are becoming more important to smaller beverage producers as small retailers install more technology into their businesses and as larger retailers implement more specific, local sets in some of their appropriate neighborhood stores. A little planning and a bit of money upfront can help your burgeoning package program reach more retailers and make your brand easier to obtain by thirsty consumers. Now go forth and scan your business to its next level!
If you liked reading this, you may also like: How to Build Your Craft Brewery Brand.