The surge in the use of aluminum cans brought on by changing consumer trends accelerated by the pandemic has led Ball Corporation, one of the largest can manufacturers in the country, to change its ordering procedures. The resulting restrictions could potentially damage the bottom line of many small and medium-sized craft breweries, distillers, and other beverage companies, just when many of them are finally starting to recover from the last two years.
The company began informing breweries across the country that are directly supplied with preprinted cans by the Ball Corp that their minimum order has increased fivefold when supply is available. That means that companies will have to raise their previous minimum order from 204,000 cans to 1,020,000. In perspective, they will need to pay for and store five semi-truck loads of cans, tying up much-needed cash and space that many businesses don’t have.
This is particularly tough on many craft brewers since during the pandemic, when their primary sales platforms disappeared (tasting rooms, bars, and restaurants), they pivoted to packaging their product to bring in much-needed income. Many have moved to install packaging lines since with an eye towards the future.
Ball Corp began informing brewers of their decision this week. “Demand for sustainable aluminum beverage packaging continues to grow at an accelerated pace. Ball is making investments to bring additional capacity online, and in the meantime, we remain in a tightly constrained supply environment for the foreseeable future. To more effectively serve our non-contracted customer base, effective January 1, 2022, where supply is available, we will require a minimum order of five truckloads per SKU for printed cans, and we will no longer be able to warehouse inventory on behalf of our customers.”
One solution the company has put forth is pointing their customers that can’t handle the larger order towards a set of four distributors. While they will take smaller orders, it will add another layer of costs into the already stretched thin aluminum supply chain for brewers and likely push them towards seeking out other solutions such as shrink-wrapped cans.
Post time: Dec-03-2021