Beverage Distributors Industry Terminology

ACV (All Commodity Volume)

A retailer-weighted distribution metric showing the percentage of total market sales that is represented by stores where a product is available. High ACV means distribution in big, high-volume outlets.

- We grew distribution from 35% to 52% ACV in grocery in Q2. - The chain reset took our kombucha from 10% to 30% ACV overnight. - Focus the next sell-in on filling ACV gaps in the Southeast.

Allocation (Allocated Item)

A limited-supply product whose quantities are designated to specific markets, distributors, or accounts, often for high-demand or seasonal releases.

- Our bourbon allocation is 200 cases this quarter—prioritize key accounts. - The winery allocated two pallets for on-premise only. - We need an allocation plan for the holiday LTOs.

Billback

A post-event reimbursement where a distributor or retailer bills a supplier (or vice versa) for agreed promotional or execution costs, such as discounts, displays, or scan-downs.

- Submit a billback for the TPR and display execution at Kroger. - The supplier rejected billbacks without photos of the endcaps. - Our billbacks exceeded budget due to unplanned scans.

Breakage and Shrink

Inventory losses from damage, spills, theft, mis-picks, or write-offs. Managed via warehouse practices, packaging, and reconciliation controls.

- Shrink ran 0.6% last month—above the 0.4% target. - Implement FEFO to reduce breakage on short-dated energy drinks. - We added corner guards to cut case breakage on pallets.

Case Equivalent (CE)

A standardized unit that converts various package sizes into a common case measure for planning and reporting (e.g., beer 24/12oz, wine 12/750ml typically = 1 CE, local conventions vary).

- The chain committed 1,200 CEs for the summer promo. - Incentives are paid per CE depleted. - Convert kegs to CE for apples-to-apples productivity reporting.

Control State

States where a government agency controls the distribution or sale of beverage alcohol (especially spirits), often using bailment warehousing and price posting.

- In control states we must follow the state’s price book. - Lead times are longer due to bailment in North Carolina. - Our control-state team handles price postings and listings.

Depletion

Distributor sales to retailers or on-premise accounts (sell-through from distributor). A core performance metric distinct from supplier shipments.

- Depletions were up 8% while shipments were flat. - Bonuses are tied to Q3 depletion goals. - Run a depletion blitz ahead of Labor Day.

DSD (Direct Store Delivery)

A route-to-market model where the distributor delivers directly to store, often with merchandising and shelf management, rather than shipping to retailer warehouses.

- Energy drinks run on DSD for speed and in-store execution. - The grocer is moving sparkling water from DSD to warehouse delivery. - DSD enables daily OOS recovery on top SKUs.

EDI (Electronic Data Interchange)

Standardized electronic documents exchanged between trading partners (e.g., 850 Purchase Order, 810 Invoice, 856 Advance Ship Notice) to automate transactions.

- The retailer requires EDI 856 before delivery appointments. - We mapped the 810 to speed up cash application. - EDI errors caused late POs at two chains.

Excise Tax

Taxes levied on beverage alcohol (and some non-alc categories) based on volume, ABV/proof gallon, or container type; affects landed cost and pricing.

- Excise tax increases will hit spirits margins by 60 bps. - Include federal and state excise in the landed cost model. - Price postings reflect the new excise schedule.

FIFO/FEFO

Inventory rotation methods: First-In-First-Out or First-Expire-First-Out, used to maintain freshness and reduce outdates.

- Move to FEFO on cold brew with 120-day code. - FIFO lapses caused write-offs on seasonal seltzers. - WMS tasks enforce FEFO pick logic in the cooler.

FOB (Free on Board)

A pricing/shipping term; in beverage trade often refers to supplier price at origin (e.g., FOB winery or FOB distributor warehouse). Risk/ownership transfer point depends on the agreed Incoterms.

- The supplier quoted $12.50 FOB winery. - Our import landed cost is FOB port plus duty and freight. - Confirm Incoterms—FOB vs EXW changes responsibility.

Gross-to-Net (GTN)

The progression from list price to the net revenue actually realized after deductions (promotions, billbacks, freight, excise, discounts).

- GTN fell 180 bps due to higher TPR depth. - Build the margin waterfall to visualize GTN leakage. - Tighten approval on OI deals to protect GTN.

GTIN (Global Trade Item Number)

Global product identifier (UPC-12, EAN-13, or case GTIN-14) used for barcoding cases and units for scanning, EDI, and traceability.

- The new 8-pack needs a unique GTIN-14 for the case. - Retailers rejected shipments due to mismatched GTINs. - Register GTINs with GS1 for the innovation line.

Hours of Service (HOS)

DOT regulations that limit commercial drivers’ daily/weekly driving and on-duty hours; impacts route planning and delivery windows.

- Adjust Friday routes to keep drivers within HOS. - HOS constraints make two runs per day impossible. - Telematics alerts us to HOS risk before violations.

IRI/NielsenIQ (Syndicated Scan Data)

Retailer POS-based data providers that report market share, velocity, pricing, promo lift, and distribution metrics across channels.

- IRI shows 25% dollar growth in our core flavors. - Use NielsenIQ to benchmark ACV and TPR lift. - Align depletion trends with syndicated velocity.

Inventory Turn

How many times inventory is sold and replenished in a period (COGS ÷ average inventory). Higher turns reduce working capital and obsolescence.

- Raise turns on slow wine SKUs via SKU rationalization. - Days of supply dropped from 41 to 32 as turns improved. - Target 12x turns for RTD tea.

Just-in-Time (JIT)

Inventory strategy to receive goods as needed for production or fulfillment, minimizing on-hand inventory while meeting service targets.

- JIT replenishment for the cold box cut storage costs. - Vendor delays make JIT risky on imported spirits. - We blended JIT with safety stock on top sellers.

Keg Float

The number of kegs in circulation across distributor, retailers, and on-premise accounts; managed to reduce loss and ensure availability.

- Our keg float is short by 120 sixtels—initiate retrieval. - Add deposits to protect against keg loss. - Cycle-time reports show kegs stuck in on-premise.

Key Account

A high-value chain or customer requiring dedicated management, custom programs, and joint business planning.

- The key account team owns resets at the mass channel. - Build a bespoke LTO for our key accounts. - Present QBR results to top three key accounts.

Landed Cost

Total cost to bring product to the distributor’s warehouse or customer, including product cost, freight, duty, excise, insurance, and handling.

- Landed cost rose $0.80/case with fuel surcharges. - Use landed cost to set price floors by state. - Duty changes alter import landed cost assumptions.

LTO (Limited Time Offer)

A seasonal or short-run SKU, pack, or price program designed to drive incremental trial, displays, or premium trade-up.

- The fall LTO includes a display-ready pallet. - Allocate LTOs to on-premise for menu features. - Track LTO depletions separately from base SKUs.

Margin Waterfall

A visualization of deductions from list price to pocket margin: trade spend, billbacks, excise, freight, logistics, cash terms, etc.

- The waterfall shows freight eroding 40 bps of margin. - Use the waterfall to prioritize trade spend cuts. - Add excise and billback steps to the waterfall model.

Merchandising

In-store execution—shelf sets, cold box placement, displays, POS materials—that drives visibility and conversion.

- Merchandising wins endcaps ahead of Super Bowl. - Verify planogram compliance on weekly routes. - Photo audits confirm display execution.

NBWA (National Beer Wholesalers Association)

Trade association for U.S. beer distributors providing advocacy, research, best practices, and training.

- Share NBWA labor benchmark data with ops. - Attend NBWA for route optimization sessions. - NBWA updates on franchise laws affect our state plans.

Net Revenue Management (NRM)

Disciplines and tools to optimize price, pack, promo, and mix to maximize profitable growth after trade spend.

- NRM analysis says shift to 8-packs in c-store. - Reduce promo depth—NRM shows low ROI on TPRs. - NRM playbook targets mix up on premium seltzers.

Off-Premise

Retail channels where product is purchased for off-site consumption (grocery, liquor, c-store, mass, club, e-commerce).

- Off-premise depletions outpaced on-premise in Q1. - The reset raised our off-premise shelf space. - Plan off-premise OOS recovery for holiday weeks.

On-Premise

Accounts where beverages are consumed on site (bars, restaurants, hotels, venues), emphasizing draft, cocktails, and experiential selling.

- On-premise velocity recovered to 2019 levels. - Add staff training to boost cocktail menu features. - Draught quality checks reduced on-premise returns.

OOS (Out-of-Stock)

When a product is unavailable at the point of sale, causing lost sales and shopper switching; tracked by scans and audits.

- OOS spiked on 12pk lime—expedite replenishment. - Set OOS alerts by store in the route app. - OOS fines apply at two major chains.

POD (Points of Distribution)

The count of outlets where a product/SKU is sold, or distinct placements inside an account; often used to assess distribution breadth.

- Add 500 PODs on our leading flavor by July. - ACV is strong, but we need more PODs in c-store. - Incentivize reps for new PODs in target zips.

POD (Proof of Delivery)

Documentation (signature, electronic confirmation, photos) verifying that a delivery was received as shipped.

- Missing PODs delay AR collections. - The retailer requires photo POD for all deliveries. - E-POD reduced disputes on shorts and damages.

POG (Planogram)

A schematic of shelf or cooler layout showing exact product placement, facings, and shelf tags to standardize execution.

- The new POG swaps in 19.2oz singles. - Audit POG compliance during route checks. - Submit POG changes after the brand adds SKUs.

QBR (Quarterly Business Review)

A structured meeting with a key customer or supplier to review performance, insights, and plans for the next quarter.

- Prepare the QBR deck with scan and depletion trends. - Use the QBR to align on holiday displays. - QBR action items include adding three PODs per store.

Route to Market (RTM)

The chosen distribution model from supplier to consumer, including DSD, warehouse-delivered, brokers, or 3PL hybrids.

- We’re testing a hybrid RTM for e-grocery. - Spirits expand via brokered RTM in open states. - RTM changes require new service-level KPIs.

RSR (Route Sales Representative)

Frontline salesperson/driver servicing a route—orders, delivery, merchandising, and relationship management.

- Add an RSR to handle the new club stores. - RSR photo audits boosted display compliance. - Train RSRs on the updated route app.

S&OP (Sales & Operations Planning)

A cross-functional cadence to align demand, supply, inventory, and financial plans on a rolling horizon.

- S&OP flagged a can shortage for Q3 LTOs. - Add scan data to the S&OP demand review. - S&OP locked a 6-week safety stock on top SKUs.

Safety Stock

Buffer inventory held to protect service levels against demand variability and supply uncertainty.

- Set safety stock to cover 95% service on seltzers. - We raised safety stock ahead of July 4th. - Safety stock is too high on slow-moving wine.

Scan Data

Retail point-of-sale data showing unit sales, price, and promo performance at the register; used to measure consumer demand and velocity.

- Scan spikes confirm the TPR worked. - Align depletions with scan trends weekly. - The buyer wants scan-based forecasts.

Tied-house Laws

Regulations that separate suppliers, distributors, and retailers and prohibit certain inducements, ownership links, and payments.

- Ensure the program complies with tied-house rules. - We can’t fund that bar equipment under state law. - Legal reviewed the sponsorship for tied-house risk.

TPR (Temporary Price Reduction)

A short-term promotional discount at retail, often supported by OI/billbacks, used to drive trial and lift.

- TPR depth is 15% for the Memorial Day ad. - TPRs without displays underperform. - Evaluate TPR lift by price tier.

TTB (Alcohol and Tobacco Tax and Trade Bureau)

The U.S. federal agency regulating beverage alcohol labeling, permits, excise tax, and formula approvals.

- COLA approval is pending at TTB. - TTB labeling rules affected the RTD’s ABV statement. - File TTB excise by the 14th.

UPC (Universal Product Code)

The 12-digit barcode used to scan consumer units at retail; critical for inventory, POS, and EDI accuracy.

- The new 4-pack needs a unique UPC. - UPC mismatch caused chargebacks at the chain. - Add UPCs to the planogram labels.

Velocity (Units per Store per Week)

A rate of sale metric showing consumer pull per store; separates distribution gains from true demand.

- Velocity rose 12% after the endcap. - Focus on flavors with the highest velocity. - Target 1.2 UPSPW before expanding ACV.

VMI (Vendor Managed Inventory)

A replenishment model where the supplier/distributor manages inventory levels at a retailer using sales and stock data.

- The club runs VMI on big packs. - VMI reduced OOS by 30% on sports drinks. - Add VMI alerts for negative on-hands.

Will-Call

Customer picks up an order at the distributor’s warehouse; useful for urgent orders or small accounts.

- The restaurant will do will-call for tonight’s event. - Close will-call by 5 pm on Fridays. - We set a will-call staging area near the dock.

WMS (Warehouse Management System)

Software that manages warehouse operations—receiving, locations, picking, replenishment, cycle counts, and shipping.

- WMS directed putaway cut travel time. - Enable batch picking in the WMS for small orders. - WMS cycle counts reduced shrink.

WSWA (Wine & Spirits Wholesalers of America)

Trade association representing U.S. wine and spirits distributors, offering advocacy, education, and industry forums.

- Attend WSWA to meet craft suppliers. - WSWA updates on DTC legislation are key. - Share WSWA category insights with the team.

X-Dock (Cross-Dock)

Logistics practice of transferring goods from inbound to outbound trucks with minimal or no storage to speed flow and lower costs.

- X-dock the pallets for same-day delivery. - Cross-docking cut dwell time by 40%. - We’ll x-dock imports to bypass storage limits.

YTD (Year-to-Date)

Performance measured from the start of the year to the current date; used for sales, depletions, and budget tracking.

- YTD depletions are +6% vs plan. - YTD trade spend is over by $120k. - Review YTD velocity before the reset.

Zone Pricing

Setting prices by geographic area or delivery zone to reflect freight, taxes, and competitive dynamics.

- Zone pricing adds $0.50/case in rural routes. - The chain negotiated single-zone pricing statewide. - Update zone rates after fuel increases.