Bridging Bars And Alcoholic Beverage Suppliers Through Data

A relationship between a restaurant or bar and its alcoholic beverages suppliers is valuable and strategic, albeit complex.

Alcoholic beverages undoubtedly make up a vital portion of a restaurant or bar’s revenue streams, and at a time when many establishments have been forced to limit operations and even close down, maintaining that stream can be a vital lifeline – for buyer and seller alike.

Yet strict and often changing regulations limit the ways that restaurants and bars can interact with their suppliers, especially when it comes to marketing and promoting their products. It can be difficult to strategize marketing efforts without the right data, a key point of friction that Overproof recently aimed to address with the launch of its BarInsights product.

Speaking with PYMNTS, Overproof Founder Marc De Kuyper explained how unlocking key data from bars’ and restaurants’ point-of-sale (POS) systems can not only strengthen suppliers’ product development and marketing efforts, but can also bolster revenues for those establishments, while deepening the B2B relationship between buyer and supplier.

Unlocking Value for Suppliers

The relationship between an alcoholic beverage supplier and its restaurant or bar clientele is highly regulated, governing how suppliers can and cannot market or sell their products. Distributors that act as the middle-person between supplier and end buyer, like a bar, are critical players in the supply chain.

That regulatory and supply chain complexity can mean suppliers have limited insights into how their products are actually performing within the businesses that sell them. That information, as Overproof recognized, can be found within the POS systems of the bars and restaurants selling those products.

“We really wanted to provide a service where, in a legal fashion, suppliers can get a full notion of return on investment,” said De Kuyper. “Suppliers get a report at the end of the month where they can really determine the return on investment. They get consumer trends, they know how many cocktails were sold, how their cocktails compare to other cocktails in terms of sales volume … That is very useful information for suppliers, and they’re willing to pay for it.”

Unlocking this information from restaurants’ POS systems, and parsing and cleaning it up for suppliers to purchase, can break down the silos that traditionally divide a supplier and end customer, while still remaining compliant.

Healthier Ecosystems

Strengthening alcoholic beverage suppliers is only one part of the overall equation to healthier supply chains within the restaurant and bar industry. At a time when so many establishments are in challenging financial situations, De Kuyper noted that it’s important for a solution to support both sides of a B2B relationship. For the bar or restaurant, that means monetizing POS data, and allowing these businesses to sell it to suppliers on the platform.

Because these firms already embrace data connectivity between their POS and other back-office systems like accounting and ERP portals, it became a natural evolution to wield that connectivity for the purpose of product analysis to open up a new revenue stream for these firms, while also supporting the growing demand for restaurants and bars to curate digital menus.

The value propositions for suppliers and restaurants are “equally important to me,” said De Kuyper.

It’s also a way to strengthen the buyer-supplier relationship in a heavily regulated industry. Historically, he explained, suppliers have been forced to rely on purchasing spots on a business’ menu via a marketing agency, and paying brand ambassadors to promote products in a bar — both of which are expensive strategies.

By educating a vendor about how a product is used in a more direct and digital fashion, there is an opportunity for that vendor to recalibrate their own marketing strategies — while at the same time, restaurants can unlock revenue at a time when it is very much in need.

“It’s really about continuous added value to streamline the partnership between suppliers and bars,” said De Kuyper.