Logistics of Beer: The King of Kegs

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Logistics of Beer: The King of Kegs

Every year at Munich Oktoberfest*, large wagons piled high with wooden beer barrels are pulled through the streets by teams of huge draft horses. But the logistics of beer has come a long way since those days. Today, beer is usually shipped in stainless steel, and hence reusable, kegs. Adam Trippe-Smith is the CEO of Konvoy, an Australian start-up that is in the process of bringing keg management into the Age of IoT.

by Tim Cole

You have been described as a serial “beerpreneur”. Sounds like you don’t just enjoy a glass or two; it’s your lifeblood.
That’s true. At first, I worked for a brewery, then I started a keg rental business and now, with Konvoy here in Australia and New Zealand, we are pioneering a new tracking system which uses wireless IoT beacons on the casks.

So essentially, you have reinvented the keg business.
That’s the way we like to think about it. I mean, kegs have been around for many, many years, but they were really just a dumb asset. In the last ten years, all of that has changed. Individual kegs can be tracked using either a barcode or an RFID tag. Konvoy is moving even further into the IoT world by adding a whole new realm of information not only for the owner of the keg who rents it to the breweries, but also for the users of the kegs, the producers, pubs, the warehouse, and the wholesalers. In effect, we’re turning the keg into a smart asset using data and analytics.

All this data just simply didn’t exist in the past.
Adam Trippe Smith, CEO of Konvoy
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How big a factor is human error in conventional keg tracking systems?
In the past, every time a keg moved out of our warehouse to a brewery, and from there to a pub, a bar, or a restaurant, it had to be scanned manually. Obviously, that takes time, and people make mistakes or get lazy. In fact, we found that only about 70 to 75 percent of all keg movements were actually being recorded.

So, what’s the solution?
Using an IoT beacon, we can track the keg’s location as well as providing temperature information so we know if the beer has been kept cool enough during transport. All this is data which just simply didn’t exist in the past.

The Konvoy system runs on the Sigfox wireless low-power network. In fact, you jokingly refer to it as “Kegfox”. Wouldn’t it have been simpler to use cellular?
When we launched last year, we looked at every alternative but our main problem is the data cost. Bearing in mind that prices for cellular have been dropping, you’re still looking at about 25 Australian dollars [€16] per year to just track one keg. Compare that to the cost of using the Sigfox network, where you’re talking about low single-digit dollars per year – a huge difference. If you think of the keg itself costing roughly a hundred dollars, then there’s a limit on what you can afford to invest in a tracking device, in data costs, and in running the network. Yes, cellular can transmit more data – but we don’t send much data. After all, we’re not transmitting photos or anything like that; all we’re doing is taking location and temperature readings. For that, Sigfox is perfect.

Logistics of Beer - Konvoy People

Where’s My Beer? Instead of scanning manually, Konvoy uses IoT beacons to track the keg’s location and temperature to make sure it has been kept cool enough during transport.

If you ship beer, say from Sydney to Perth, when it’s returned the keg’s empty and you’re essentially moving air across the continent half the time. Can tracking technology help make better use of a keg?
Konvoy eliminates all that waste because the keg that we started with at the brewery in Sydney will eventually wind up for reuse at a brewery in Perth. It never travels back across the country empty. This means you can use it more often, so you can purchase fewer kegs. Thanks to all this information, keg owners can reuse them quickly.

What are your plans for the near future?
We’re tackling two problems at once: the first being our keg rental business, the other the tracking side which we’re happy to let others use to monitor their own keg fleets. Once we’ve mastered that market here in Australia, we intend to expand into multiple geographies. That’s where the real opportunity for growth lies – and we’re pretty excited about bringing that to the world.

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