Beverage Distributors refrigerates entire delivery fleet
Among wines, only Madeira really likes heat. In fact, in the 18th and 19th centuries, wine from the Portuguese island off the coast of West Africa was matured in cask by use as ballast in the holds of sailing ships bound to the Orient; today it matures in large oven-like buildings called estufas. The resultant stifling heat produces a wine with a distinct, slightly burnt, slightly sweet flavor. The English may drink warm beer, but that preference is based on climate and taste, because, truth be told, the English do not consciously warm their beer, they simply do not ice it.
In nearly every other instance, heat stands as a deadly enemy to fine wine and to the shelf life of good, non-pasteurized beer, as anyone who has ever tasted a once glorious Chardonnay turned brown and oxidized by heat or smelled the stinky odor of beer left in the sun can attest. Some beers — and those from the New Belgium Brewing Company in Fort Collins, Colorado, are among them — are meant to remain cool from the time brewing is complete until consumption. Since neither Colorado, nor any of the other 12 states where Fat Tire Ale and the other New Belgium products are marketed, has a climate like Western Europe where beer can be safely stored at cellar temperature, distributors must make artificial adjustments to storage and transportation conditions.
Mercury Warehouse & Delivery, a subsidiary of Beverage Distributors Company, recently completed a transition that converted its entire fleet of 55 route trucks and 10 trailers from dry vans to refrigerated equipment for the express purpose of protecting beer and wine during the delivery process. “We made the change as a sign of our commitment to maintaining the quality of the products provided by our beer suppliers,” says John Slater, transportation manager for Mercury Warehouse. “We expect that having a refrigerated fleet will produce the added benefit of helping increase wine sales, because we believe that delivery temperature will become more of a factor to our wine customers in the future.”
State's largest distributor
Beverage Distributors, based in Aurora, Colorado, is the largest beer, wine, and liquor distributor in the state. Operating only in Colorado, the company uses its two sales subsidiaries, Midwest Beverage Company and Pinnacle Distributing, to promote its inventory of more than 5,000 items. To complete the corporate picture, Beverage Distributors is, itself, a part of the Charmer Sunbelt group of beverage sales and distribution companies, which is based in New York City.
Mercury Warehouse operates from a 208,000-sq-ft distribution center that was built in 1979. Alterations to the building since have added 9,600 sq ft of temperature-controlled space, and more refrigerated space is in the process of installation. Insulated walls already have been erected inside the building, and only the refrigerant plumbing, evaporators, and air circulation equipment remains to be installed for an additional 10,000 sq ft that will primarily be dedicated to the protective storage of wine.
The fleet conversion and building modification are part of a program designed to ensure that the entire product line is delivered in the best condition possible. However, delivery of cooled product is not new to Mercury Warehouse. The company has been delivering cooled products, mostly keg beer, for more than 10 years. Until the conversion to a refrigerated fleet, cooled product was transported under fitted insulating blankets. The conversion program was prodded forward by the need to provide refrigeration for products from New Belgium Brewing, Beverage Distributors' largest selling beer supplier. New Belgium actually participated in the fleet conversion by sharing in the cost of the graphics packages on many of the delivery trucks.
Two-tiered alcohol sales
Regulations in Colorado give the state a two-tiered alcohol sales structure. Low-strength beer at 3.2% alcohol can be sold in supermarkets and convenience stores. This product can be sold on Sunday as well. All other alcohol sales are limited to retail and foodservice locations with a full liquor license. Mercury Warehouse participates only on the upper tier, because it does not carry any of the mass market, low-strength beers, so it has no supermarket or convenience store distribution. Product volume at Mercury Warehouse can be divided roughly into 40% for beer, 40% for wine, and 20% for liquor. Because the volume at some retail outlets is small and because the price of some products is relatively high, Mercury Warehouse will deliver wine and liquor in quantities as small as a single bottle. About 10% of most loads are single bottles or partial cases of liquor or wine. One case or one keg is the smallest available quantity of beer.
Most routes make 25 to 30 stops a day with roughly 350 cases in the load. The case count varies depending on the number of beer kegs in the load. For purposes of weight calculations, one keg of beer is equal to five cases of wine. In 2002, Mercury Warehouse delivered 18 cases per stop to 1,300 customers per day from loads averaging 368 cases per route. Most routes require 10 to 12 hours to complete.
More than half the delivery volume goes to customers along the Rocky Mountain front range. High volume and metropolitan customers can have daily delivery if requested. In general, liquor store delivery is less frequent than delivery to bars and restaurants. Nearly all routes dispatch from Aurora, but customers west of Glenwood Springs are served by five resident drivers based in Grand Junction. Most of the routes from Grand Junction require two days to complete. The exception is the route to Durango and the Four Corners area, which is a four-day route. Mercury Warehouse uses a rotation of 10 trailers to provide loads for the Grand Junction drivers. The company has enough business in Durango that it also dispatches a trailer to the area from Denver.
Colorado also is an exclusive distribution state, meaning that distributors cannot carry the exact same lines of product. As a result, every serving of New Belgium beer sold in Colorado is distributed by Mercury Warehouse.
Numerous craft brewers
Although the beer inventory at Mercury warehouse is dominated by New Belgium Brewing, the company also distributes a wide range of imported beer and beers from numerous domestic craft brewers. Craft brewing is a new term in the beer business. A craft brewer makes a product significantly different than the mass-market brewers such as Coors, but has sufficient volume to have outgrown classification as a microbrewery. As the terminology is currently used, a microbrewery is essentially a basement or garage operation with sales limited to its local community, Slater says. “New Belgium started as a basement operation about 10 years ago, delivering its beer with the family station wagon,” he says. “Now with distribution in 13 states, New Belgium certainly rates classification as a craft brewery.”
The conversion to an all-refrigerated fleet began in February 2003 and was completed in late April. Mercury Warehouse now has the only all-refrigerated fleet in the beer and wine distribution business in Colorado The program involved modification of some trucks with insulation and refrigeration units and outright replacement of older equipment with new refrigerated bodies. Five companies plus Beverage Distributors were involved in the conversion. Retrofit work for existing truck bodies was handled by Merritt Equipment, a truck body distributor also well known for its line of large livestock trailers. New truck bodies were manufactured by Morgan Corporation. The new refrigerated bodies have three inches of insulation in the sidewalls, floor, and ceiling, and four inches in the nose. CT Power, the Carrier Transicold dealer in Denver, advised on refrigeration specifications and installed the units. Colorgraphics provided design, production, and installation of a range of decals depicting the New Belgium line of beers. Finally, MHC Truck Leasing, the Denver PacLease franchisee, coordinated the whole program and provided new truck chassis when needed.
Trucks involved in the retrofit program were out of service for about a week, Slater says. Merritt Equipment took about two days to install insulation and new interior body liners and to refinish the body floors. Lamps also were installed in the ceiling, because adding insulation covered up the translucent ceilings that let light into the bodies. Drivers haven't complained about the loss of the translucent ceilings, because the bodies are cool and comfortable to work in, he says. Following the insulation installation, CT power usually took a couple of days to install refrigeration units, including in-cab control panels.
Mercury Warehouse leases all power equipment and truck bodies from MHC. It owns the small trailer fleet. With equipment on a six-year lease, the fleet conversion made little change to truck life cycles. Those chassis nearing the end of the lease term were replaced, while those with most of the lease term still ahead of them were retained and the truck bodies retrofitted with insulation and refrigeration units. Trucks and bodies are leased as units. At the end of a lease term, the decision to keep or dispose of truck bodies is made on an individual basis. After six years in the urban setting of Denver and the other cities along the Rocky Mountain front range stretching from Fort Collins to Pueblo, many of the bodies have served a complete useful life and are ready for replacement. In the past, the company remounted bodies on new chassis about 40% of the time. The retrofitted bodies will be replaced outright at the end of the current lease. New refrigerated bodies may be remounted once, depending on condition at the end of six years.
“We haven't come to a decision about refrigeration unit life yet,” Slater says. “We will evaluate our replacement policy at the end of the first lease term. We have Carrier Transicold Supra 644 units on 18 ft or 22 ft bodies, and we set them for 45° F to provide good refrigeration for beer while not chilling the wine too much. Liquor is so stable that the temperature doesn't matter very much. Running at 45° is an easy duty cycle for a unit with as much capacity as a 644.”
The Supra 644 units are oversized for the light duty application, Slater says. Mercury Warehouse could have cooled its trucks with truck engine-driven refrigeration if it had not insisted on units that continued to provide refrigeration when the truck is stopped and if it had not wanted units that can heat as well as cool. Deep chilling beer is not a problem as long as it is not allowed to freeze and break the bottle. Obviously, wine freezes at a lower temperature than beer, but extended chilling to extremely low temperature can cause wine to shed a precipitate of fine tartar crystals that consumers find offensive in appearance, especially in white wine.
Constant refrigeration
Refrigeration while the truck is stopped is particularly important, because Mercury Warehouse wants to provide constant temperature control for beer. That means refrigeration units are started as soon as loaded trucks pull away from the dock at night. Units, then, run in start/stop mode until delivery is complete or until the truck returns to the warehouse if the driver has return product on board. The alternative to running the units in start/stop mode overnight would have been installation of electric standby outlets for all 55 trucks, a cost-prohibitive proposition, Slater says.
The basic delivery fleet consists of Kenworth T300 single drive chassis with 18-ft truck bodies. Body size was recently extended from 16 ft. For longer or high volume routes, Mercury Warehouse also operates 10 tandem drive Kenworth T800 trucks with 22-ft bodies. The T300 chassis are powered by Caterpillar 3126E engines rated at 250 horsepower. Starting 18 months ago, the company began specifying that the T300s be equipped with Allison 3060 automatic transmissions. The T800 chassis use Cat C12 engines and Eaton Fuller 10-speed Roadranger transmissions. All trucks have air brakes and air suspension. The entire fleet is governed to 68 miles per hour. “We don't want our trucks running down the interstate at 75 mph,” Slater says.
The fleet runs almost two million miles annually and boasts a fleet fuel economy average of 7.5 miles per gallon. A recent increase in horsepower for the tractors running to Grand Junction has resulted in a one mpg increase in economy to 7.8 mpg. The earlier trucks were underpowered for the mountain application, which caused the engine to work harder than necessary. This is an instance where adding horsepower actually increased vehicle efficiency, Slater says.
Beer and wine distribution imposes some special conditions on delivery equipment. The main concern is weight. Mercury Warehouse wants truck bodies and trailers that can be loaded to full cubic capacity without going over the weight limit. This is especially true for routes that require a lot of kegs, which must be loaded in a single tier. Other products can be stacked on top of the kegs if needed.
The company's trailers are built to reduce weight as much as possible. Short trailers used in a doubles combination for Grand Junction are only 24 ft long instead of the more conventional 28 ft. Rather than using 48-ft vans for long trailers, Mercury Warehouse still buys 40-ft reefers. Other weight reducing measures include limiting trailers to a height of 12' 6" and holding width to 96 inches instead of the now-standard 102 inches. Trailers are kept in the fleet for an average of 14 years.
