Minimum Requirements
For Getting Into The
Specialty Beverage
Distribution Business

By Elliott Hirsh, Juice Maven 4/18/2001
 


 

Yourself:
Self motivated, outgoing personality, people oriented, some what crazy

Cash:
You need cash for this venture. Even shoe strings cost money.
Here is a budget  in Excel format. Download it and play with the numbers,

Truck:

Two major considerations: First is how much money do you have and the second is do you plan to drive the truck yourself and if so do you have a "CDL" (Commercial Drivers License). The weight limit is over 26000 GVW (Gross Vehicle Weight) This means the truck, driver, fuel and load can not weight more than that limit. That's why there are many truck which have a GVW of 25900-just under the threshold that requires a Class B CDL License. There is also requirements for air brakes, but since I do not have a CDL myself, I am not that familiar with all the requirements.

UNDER CDL TRUCKS: Ford E350 work van or equivalent. (1 ton) or E350 cube van. Diesel gets much better mileage but are much more expensive and if you're spending that kind of money, you max out the weight. An E350 (E250's are more commonly available, but in this business ,hold out for the 350)

Isuzu/GMC Diesel City Van (usually lower than dock high). Readily available new, used or leased. Maintains their value. Cutaway Box with Dual WheelsThese trucks can be loaded with pallets which facilitate loading in the morning. Each customers order is picked and put on a pallet. So the driver has to find the pallet with the particular customer's order and then pick the items off of that one pallet. He can carry one or two cases at a time to the end of the truck. Then pick up the cases again and put them on the hand truck and make the delivery into the store. However, these trucks generally are built lower than normal truck dock height. So while you can load pallets on them, you can not do so at the same dock you would use to unload trailers.

 

You can get a "straight van" which normally have the floor of the truck "dock high" and they vary in length. A straight truck which has a 20 ft body will hold 8 full pallets of product which weighs about 16,000 lbs so it would be under the CDL limit. But a 16ft truck might be easier to drive and park.

Side Loading Beverage Truck. The big advantage is that you pull up to the store, jump out of the truck with the invoice in your teeth, grab the hand truck, roll up the door, grab the products you need, put them on the hand truck, roll down the door, roll the hand truck into the store. Put the product in the corner or wherever the buyer wants it, collect your money and then get back in the truck to the next stop.

You are not jumping up and down the truck having to carry or move the product to door etc. There are some people that like to climb over pallets looking for the items required for each delivery. If this is the mode in which you plan to operate go for side loaders.

Elliott's with a Small 6 Bay Beverage Truck
There are beverage trucks which are under the CDL limit of  under 26,000 GVW and these generally have about 6 bays.  Water companies generally use these for home and office deliveries.  Those which are larger may require a CDL, but there are more of those around used because soda and beer companies use those larger trucks.  Make sure you get a diesel engine and automatic transmission on any large truck. Better fuel mileage and drivers will destroy clutches in stop and go driving.

Two major manufacturers of bodies all have web sites: Hackney and Mickey and there are some minor ones like Hessco located in Kulpsville, PA outside Phila.

Some dealers have a  handle on used beverage trucks.  Betten Trucks, Bucks Trucks,  International Used Truck Finder  Mickey in North Carolina and Hackney in So Carolina  also has a used truck department and will sell you a refurnished body on a used chassis.

The bay size is important. Beer trucks generally have 40" x 40" bays, but most soda, juice and water comes on 42" x 48" pallets. If you want a truck which you can throw a couple pallets of water and soda without picking and restacking the cases, get a truck with bigger bays which are 52" wide.. If you plan to pick and stack the orders and have a large variety or looking for more bays to separate the various products  Also, you can get shelves installed in these bay trucks. Best to go with brackets welded into the sides that accommodate horizontal bars that support a pallet. These give you the most flexibility.

Warehouse:

You need a place to efficiently receive merchandise, pick orders, load trucks in all weather and use as a base of operations. A self-store shed will not work.
- A smooth, paved parking lot, Gravel or dirt will NOT work.
-You must be able to receive deliveries by tractor trailers, which are now 48-53 foot trailers with tractors with sleeper cabs. So these are long and have trouble making turns onto inner city streets. The skill level varies with OTR drivers who will bring product to your warehouse.
-Watch weight restrictions on streets and bridges and some street forbid tractor trailers and may require long detours to get to your warehouse.
-Watch overhead clearances...overpasses, bridges, wires, trees
-Floor Space and layout: A standard grocery/beverage pallet is a little less than 16 square feet (42" x 48"). You may be able to stack product 2 or 3 pallets high. Product in plastic bottles and shrink wrapped trays should not be stacked more than 2 high.  Twenty pallets-the typical "full truck load" quantity occupies a 40ft long x 8 ft wide space which is  320 sqft without aisles to maneuver. If you carry  30 different items (they start to add up quickly) and you bring in 1 pallet of 15 items and 2 pallets of the other 15 items, you will have to deal with 45 pallets @ 16 sq. ft. which is 720 sq ft.  But you need additional space for aisles wide enough to move pallets around either with a forklift or electric or manual pallet jack as well as space for the pallet from which you will pick orders  and space to stage the picked orders before they are loaded on the truck.  This does not take into consideration any space required to drive the truck into the warehouse and maneuver forklifts around the truck for loading. If you are operating in cold weather and are loading the trucks up the night before and keeping them in the warehouse, you will need to provide room. Otherwise you will have to pick the orders, stage the pallets and then load the trucks in the morning so the product does not freeze overnight.

So you need to figure out space for the "pick line" and the "back stock".   Aisles:  It's possible to work with narrower aisles, but then you have to use a pallet jack to maneuver the pallets down the aisle and into position in the pick line. The pallets should not touch each other so they can be moved  in and out of position without affecting the ones adjacent to it.  If your using a forklift to stack the pallets you need to allow for an aisle that is at least equal to the length of the forklift plus two pallet lengths (8 ft) to allow you to pick up a pallet, back straight back until the pallet clears the one next to it and make a 90 degree turn and then make another 90 degree turn in order to stack in on top of another pallet in another slot.  You want plenty of clearance behind you so if you have product stacked in opposing aisles you will need about 15 to 20 ft between the aisles. See comments about forklift trucks below.

Pallets racking is a good idea if your will have many inventory items. You don't have top start with racking. Wait until your second warehouse to use racking.  Put the items moving the fastest on the floor level-slower moving items on top. These will be harder to get down either by taking the pallet down, removing the product and putting it back up or by getting a moveable warehouse ladder (with locking wheels). You save floor space but waste time handling the product. Efficiently can always be improved once you have the sales end of the business working. Sales is everything.

Remember this:
Effectiveness is doing the right thing. Efficiency is doing things right. Peter Drucker

Material Handling:
Work smart. Not hard!


Little three wheel electric fork lift truck (Like the one I have) is perfect for this job. Tight turning radius, triple mast that allows me to drive into trailers, stack 3 height, adjust position with side shifter.
and it has a might shorter turning radius than the usual propane powered, four wheel models. The capacity is about 2500 lbs. Forklift capacity depends on the weight of the pallet and the height which you must raise the load.

You probably should not consider a warehouse that is less than 2500 square feet with an 100-150 sq. ft office and a powder room. This may hold you for a year or two, then hopefully you'll be ready to move into a 5-6,000 ft building. If you grow the number of accounts and take on additional products, you may need more room. Watch the cost of your overhead.

HINT: A very good start-up strategy would be to find somebody that has extra space
with the following criteria: 1)has a loading dock and a drive in door 2) has a fork lift and a driver he will lend you (for a charge) to unload trucks coming in with product and pout in in "your area" 3)has his employees under control so they won't rip off product 4)allow you access to the building so you can get to "your space" or "your space" has a separate access door so you can operate your distribution business and are only dependent on him to get your product unloaded even if your not there which frees you up from waiting for trucks when you should be out selling. Check out yourfirstforklift.com

Warehouse with dock only
Minimum requirement is electric pallet jack and dock plate to pull pallets off truck and move around warehouse, but you can not lift pallets and stack them one of top of another or use pallet racks.
Invest in a small forklift truck with a capacity of 2500-3000 lb. and a  mast low enough to drive into trailer and high enough to stack pallets. Side shifter on the forklift will make you life easier and make the job go faster and will pay for itself.

Stacking Elliott's Amazing Juice pallets 3 high requires at least 13 ft ceilings. Some product in plastic bottles can not be stacked 3 high because bottom pallet will be crushed by the weight. Our bottles are 7.5 inches high x 6 high per pallet.  3 pallets x 18 layers + 3 x 6" for the height of each pallet plus 8-12 inches of clearance is required. If your ceilings are not this high, you'll need more floor space for the same amount of inventory.

Loading your truck with a dock only requires that you get a truck that you can back up to the dock and load product on pallets and move them into the truck by the pallet. Making deliveries to most places will require you to jump up on the truck, find the product/order, carry it to the end of the truck. Jump down. Take the product off a case at a time. Stack it on a hand truck. Bring it into the customer's place of business. Some trucks have ramps...good for large orders. Some truck have lift gates. Same problem. Pick order. Put on hand truck. Wheel hand truck onto lift gate. Operate lift gate...usually must be done at street level unless you have a helper. Also lift gates require more space behind the truck.

Warehouse without Dock
Parking lot or street must be level. A gravel parking load will not work. Difficult to drive forklift truck on, puts extreme wear on tires and loads are shaky. Impossible in rain or snow.

If trailer is full load and the pallets are loaded to the door,  you need a chain to attach to pallet and to fork lift truck. Back up to pull pallet to edge of truck. Then you detach chain and lift pallet off truck and move into warehouse. Continue to pull off pallets this way until you have enough room to put pallet jack up on truck (lay between forks and lift up and second person slides jack off forks). Then jack up pallet and rotate 180 degrees and push towards door and drop at edge. Now forklift can take pallet off.

If you don't have a loading dock, it will require an extra person to help unload/load trailers and dock high trucks. Many over-the-road drivers do not help with loading or unloading. If they do help, they appreciate a thank you, a $20 bill for dinner money and some product to put up in the cab with them.

The height of the door is important. Make sure the overhead door is at least 12 ft high (still too low to back the trailer into the opening and out of the rain) and at least 9-10 feet wide. The size of an overhead door can be increased. They remove the door, cut the opening, put in a steel beam and reinstall a new door. About a $4000 job. A door the size indicated above will allow you to back a beverage truck into the building for loading if you have enough space, or to park in inside if you have a potential security problem or to protect product from freezing in very very cold weather. Most beverages start to freeze at 25 degrees. Water freezes at 32 F. The sugar lowers the freezing temperature much the same as antifreeze does. If the product is in cartons and shrink wrapped and loaded on pallets on a truck with doors closed and is outside and the temperature drops at night to 25 degrees, the product is not going to freeze. But if you're in the middle of a cold snap for a couple of days and nights, you have to unload the trucks at night and reload them in the morning. If your warehouse is big enough, you can load the trucks outside, then pull them in at night for safe keeping.

Warehouses with both a loading dock and drive in door:
I like this the best. A dock for unloading trailers efficiently and a drive in door for driving a fork lift truck outside to load and unload small vans, straight trucks with a few pallets on it, or side loading beverage trucks (with roll up doors).

Some warehouses like this have the loading dock "dug out" so a truck backs up into a "pit" to allow the back of the truck to be level with the dock.  The truck will not be perfectly level and if you're moving pallets on a manual pallet jack out of the truck, it's easier than trying to load the truck since you have to push the one ton pallet up hill and may require 2 people. This is way an electric pallet jack or forklift is necessary.

Some warehouses have the loading dock(s) on one side of the building and a drive in door on the other due to the way the building is graded. This may work.

Building that had two loading docks and a concrete ramp was pushed up to the dock to make a "drive in door" is not good for this business. First, you really can't drive anything large up the ramp and into the building because the truck may be too tail to clear the door. Next, driving up and down a ramp like that with a pallet with loose cases of beverages in glass bottles is tricky. And finally, small electric fork lifts don't have enough power to maneuver up the ramp unless it is a extremely gentle slope which means the ramp is very long.

The best arrangement is that the overhead door is situated so that the parking lot or street is on the same level as the warehouse floor and the loading dock is located on the another side or end of the building so that the truck is level when parked on the street or driveway and the dock is also the same level as the warehouse floor. The compromise is a "dug out pit" but the trailer will be slopping down.

Misc Warehouse Equipment

desk, chairs, file cabinet, heater for the office (electric or kerosene will work OK)
trash cans
access to a dumpster (share someone else's)
push broom and square bottom long handle shovel
2- 5 gallon buckets, dish washing detergent, bleach (to clean up and repack broken cases)
soap, toilet paper, paper towels, janitorial supplies
battery water bottle for forklift truck battery
hydraulic fluid and funnel to check and add fluid to forklift truck
basic hand tools-wrenches, screw drivers etc.
duck tape
dock plate (must be heavy enough for fork lift truck or lighter one for pallet jack
pallet pulling chain or HD tow strap
pallet "grabber" clamp for pulling pallets
pump up pallet jack
desks and chairs (people throw them away-check news papers)
stretch wrap film and dispenser

Truck Equipment
Hand Truck : Magliner with stair climbers, with nose plate large enough, with back rails, with   pulling loop,  with pneumatic or solid tires. Chain with pad lock so it 1) doesn't fall off truck 2)isn't stolen when you're at lunch.  Magnesium hand trucks cost more, but after taking it on and off the truck 15 times a day, you'll appreciate the lighter weight over a steel hand truck which might cost $50 at HomeDepot. The stair climbers help you drag the loaded hand truck up the curbs and steps you'll encounter at various stops.
Clip Board
Writing Instruments
       Ball point pens to write up orders  I usd to be able to buy "Fischer Space Pens" which were pressurized, allowed you to write on vertical surfaces and           wrote in the coldest weather. Other wise keep the pen in your breast pocket on cold days. I have not seen them around, but you can track them down on the internet.
       "Sharpie" black marker to fill in price circles on POS
Clear box sealing tape to fix torn boxes. A tape dispenser is handy, but you can tear the tape with your teeth and fold the end over so you won;t waste time looking for the edge every time you use it.
"Scotch" tape to hang up point of sale materials that are not pressure sensitive. If you don;t put up the signs yourself, they will just go under the counter and eventually into the trash if you hand them to the store owner or clerk. Ask " Is it OK if I put up this small sign?"
Map books to find places you can't find
Money safe to keep from getting shot  Usually not necessary if you're in the burbs, but without question the crooks know delivery drivers MAY have cash. If you have safe or just a sign that say" Truck Equipped with Safe Driver Can not Open", that may be a deterent.

Personnel

Hiring a helper will be easier and safer than hiring the first driver who needs to make show up, make deliveries, be nice to your customers, collect money, drive safely, not damage the product, come back at a decent hour after finishing all the deliveries and turn over all the money.

There's a lot more you can learn in this business and some former employees whom we caught stealing know some of the tricks to "pencil whip" you and some of them are so desperate that they will make the deliveries, collect the money and you'll never see them again. Some will sell product they sneaked out of the warehouse or shorted one customer  to sell to other customers at a discount and be in business for themselves. You'll have inventory shortages and customers who never got product or were charged for product on the bill but never received because the driver did not bring all the cases in and then charged them for the product. Always have the customer sign that they received the order and the cases indicated.

You have to know what's loaded on the truck when it goes out in the morning  and what's on the truck when it comes back at night.

I've asked a few former employees to contribute their knowledge and experience on this subject, but they're busy stealing from the next guy they conned a job from. It is pointless to try to prosecute white collar crime. The police don't care and no district attorney is going to waste time and money prosecuting a low profile crime that is not going to advance their political career. Make sure your insurance policy covers employee dishonesty and don't hire anybody that has major problems with their work history, license expirations, references or sniffle a lot, if you know what I mean.