Recently in the Craft Beer Professionals group, someone asked how everyone is handling sales reps buying lunch and beers at accounts. Thought it was a useful question, not about whether you should reimburse sales reps (yes, you should, duh), but more for rules around expense accounts and using them to your brewery’s advantage. How about for super small start-ups that maybe can’t afford expense accounts (which, of course, could be a sign you can’t handle a sales rep anyway). Our favorite responses are below, but you can view the full thread here.
How do you handle sales reps buying food, beers at accounts?
Erik Fowler, White Labs: Probably depends on state laws. It’s very common though to be able to expense lunch and a beer at an account. It builds a great relationship and gives the rep time with the staff without being pushy.
Karen McBride Gattuso: Company card and a monthly budget. A meal and a beer at an account is a great way to do recon and connect with bartenders/ staff. We also do periodic reviews of our reps’ spending habits, including total spending at individual accounts as well as $ spent per CE sold in. That in turn becomes part of Sales team meetings when we talk about cultivating relationships with accounts and distributors, making long plays for permanent lines, knowing when to cut losses on an account that isn’t going to come through, and overall how to spend company money strategically in the market.
Peter EarthBiscuit, formerly of Seabright Brewery: Even other employees should have this ability. I worked at one brewery that gave production employees small branded stickers to attach to the merchant copy of the receipt that said “thanks for carrying our product!” We were then asked to leave a 20-30% tip and take a photo for reimbursement. At the end of the night, the manager collecting the receipts sees the note and makes a mental note that employees of that brewery are not only spending money there, but tipping well too.
- John McGroarty, Butcher and the Brewer: I worked at a similar place about a decade ago. Once you hit a certain level in production, you were given a monthly budget to spend on beers at local establishments. Take care of your people and they’ll take care of you
Mike Wayne, Papa Bolo Brewing: Everyone had business cards at Sam Adams. We were taught to always leave a compliment to the brewpub even if it was just the “Your curtains are nice.” My card from 2004 was still displayed in Egg Harbor WI last time I was there. Brilliant return on investment!!
Josh Breault, Orchestrated Minds Brewing: I understand this is place to ask these questions. But what the actual heck is going on when we question if people on the road, selling for you, should be reimbursed for meals. That follows the same trajectory of paying your head brewer 35k and then charging them for a shifty. Just don’t do it.
Rachel Grieder: When I was a sales rep, we were always encourage to grab lunch and a beer. You can check the quality of it, and you you are showing your support to the account. Plus if I was ever in the area if my sales rep form my wholesaler, I would invite them to join me. It’s a win win for everyone and to Gary Rosen’s point, get those bartenders on your side and tip well. I had a corp card and we would expense it all. I would also buy a pint or a bottle/can if I saw someone drinking the product I sold.
Eric Addison: Looks like I will be in the minority here, and probably get flamed…BUT, for non-established breweries, this just isn’t possible. There just isn’t that much profit in a keg of beer sold. You have: general overhead, labor to brew and package it, labor cost to a salesperson to sell it, labor costs to have someone deliver it, and dozens of taxes, fees, and other operating costs. I will admit I am new to this, but until you get established the profit just isn’t there to have an expense account. My argument is just about expense accounts, not living wages, fair treatment, etc.
- Robert Alexander Lee: @Eric Addison you’re definitely not wrong, but that is part of having dedicated sales staff imo. Most smaller breweries that I am aware of their set up have an owner be the “sales” for this reason
- Megan Parker: @Robert Alexander Lee yep, if you need a sales rep you need to expect to compensate them appropriately. That’s why many of our local breweries had owners out selling for their first few years.
Christie Merandino, Transport Brewery: I view it as Quality Control. If a sales rep sells your breweries item and goes to the account, let them test it. See how it’s served by a random bartender, ensure that they have clean lines and glasses. I know the glass part isn’t on the brewery but if your delicious beer is served in a dirty glass, a beer nerds opinion may hinder.
Kevin Keller, Prototype Brewery and Meadery: We did a hybrid approach at a previous gig. When we didn’t have any rules behind it reps were having a beer at every stop. You could expense a meal if you were treating a wholesale employee to lunch/dinner or if it was at a brewery focused event at an account. If you had a beer, you could expense it if it was a beer from our brewery (if you were out with a wholesaler rep and our beer wasn’t on tap, try to buy something that they sold as a courtesy).
In my early days we had reps expenses a meal every single day along with several beers so we had to come up with some guidelines.
Gary Rosen: yes. quick meal, beer and 30%+ tip gets the bartenders on your side and i promise you that a good bartender sells more of your beer than anyone outside of your sales team.
Scott Williams, Moksa Brewing Co.: @Ken Konarzewski Jr. I totally agree, also should make sure they spread that business around to other accounts or potential accounts not just one account where they have freinds or a cute bartender. Implementing a budget either per meal of say $40 total or a budget for the week of $120 will help keep things from getting out of hand with expenses, some meals will be cheaper and others more expensive, but they will at least have a point of reference.
Jessica Bleichner, Roundhouse Brewery: Being in the brewing industry, and working in a restaurant that has tap beer, I will definitely say that if a rep comes in and doesn’t order something, it is insulting. We’re busy trying to get through our day and someone wanting attention that isn’t a paying customer, ew. They get put to the bottom of the list of potential suppliers for the bar. Someone sitting at the bar, ordering, chatting it up and leaving a card & samples = top of the list. It shows an understanding for the folks serving the beer & the system they are working in.
- Megan Parker: @Jessica Bleichner I agree with you, mostly. But I’m expected to call on 30-40 accounts a week and I can’t stop and have a beer at every account every time. I think there’s something to be said for, as a sales rep, building the relationship with your account and supporting said account, of course. It’s just not reasonable to expect your reps to stop in for an hour at every account every visit.
Gary Burkhart: All of this is great advice. You can also set a monthly budget and pay up to that amount on an expense report. I worked for a distributor who capped it at $250 a month. I’ve had larger budgets as well.