The Craft Beer Game and the Value of Information Sharing

Book chapter (2021)

Authors

Joshua Grassel California Polytechnic State University
Alfred Craig Keller California Polytechnic State University
Alessandro Hill California Polytechnic State University
F. Schulte Transport Engineering and Logistics - Mechanical, Maritime and Materials Engineering
Research Group
Transport Engineering and Logistics (Mechanical, Maritime and Materials Engineering) (TU Delft)
Copyright: © 2021 Joshua Grassel, Alfred Craig Keller, Alessandro Hill, F. Schulte
DOI: https://doi.org/10.1007/978-3-030-87672-2_15
Simulation Information sharing Supply chain management Craft beer industry Production planning
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Published Date

2021

Language

English

Reuse Rights

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Faculty

Mechanical, Maritime and Materials Engineering

Department

Marine and Transport Technology

Research Group

Transport Engineering and Logistics

Abstract

The craft beer supply chain in the USA differs from the supply chain of macro breweries in its structure, handled volumes and product shelf-life. In this work, we study how these smaller craft breweries can benefit from transparency in their supply chain. We consider additional information sharing of orders and inventories at downstream nodes. The levels that we investigate grant the brewery incremental access to distributor, wholesaler, and retailer data. We show how this knowledge can be incorporated effectively into the brewery’s production planning strategy. Extending the well-known beer game, we conduct a simulation study using real-world craft beer supply chain parameters and demand. We quantify the impact of information sharing on the craft brewery’s sales, spoilage, and beer quality. Our model is designed to directly support the brewery when evaluating the value of downstream information and negotiating data purchases with brokers. Through a computational analysis, we show that the brewery’s benefits increase almost linearly with every downstream node that it gets data from. Full transparency allows to halve the missed beer sales, and beer spoilage can even be reduced by 70% on average.