TTB Formula Ruling is Big Win for Craft Brewers

After years of persistent petitioning from the Brewers Association, TTB has made big revisions to the formula and labeling requirements for beer. Prior to the ruling made on June 5th, 2014, in many cases craft brewers were required to submit a formula for approval as well as obtain a COLA before they were able to get their beer to consumers. This lengthy process substantially increased time to market.

In May 2006, the Brewers Association proposed changes to what TTB recognized as traditional ingredients such as certain fruits, spices, and processes including aging beer in barrels that were used in the production or storage of wine and spirits. These proposed ingredients and processes would no longer require the extra step of acquiring a formula approval from TTB and would be labeled according to trade understanding. Since the initial petition in 2006, TTB has seen a substantial rise in formula approval requests from a new age of brewers that have revived traditional, historical brewing practices which include a variety of innovative ingredients and processes. Because of the recent steep rise in requests, TTB undertook additional research to find out if these now commonly used ingredients would cause compliance issues further down the road. These studies produced conclusive results that the requested ingredients and processes would not cause compliance issues because they were so widely utilized.

This new ruling is a huge lift for many breweries, since it eliminates the tedious and time-consuming process of acquiring formula approvals. TTB has conveyed that this ruling is a means to “provide immediate relief from the formula requirement burden for certain products.” It is also the beginning of a reassessment of how the TTB can “reduce regulatory burdens” and be most effective in working together with brewers to get quality beer to consumers.

Brewers are already experiencing the positive effects of this ruling. When we reached out to Heather Gleeson from New Belgium Brewing Company, she said that previously, it would take around 75 days for all formula approvals from TTB. “Eliminating the need for formulas with ingredients that you can pick up at the local grocery store which are generally recognized as safe and common is super exciting.” Heather is also very pleased to see that formulas are no longer required for the utilization of wood barrels that previously contained wine or spirits since New Belgium Brewing Company makes so many different sour ales that are aged in wood barrels. She has already seen a drop in approval time from 75 to 65 days for formulas that actually do require approval. “Getting beer to market much faster is huge. It is also less of an administrative burden for TTB that just makes a lot of sense.” Everyone is looking forward to faster approval times for formulas, and already enjoying being able to withdraw formula applications that are no longer required.

*Even since June 10th we’ve seen a drop in formula approval times from 72 days to 63 days.

While certain ingredients and processes are now exempt from formula approval, TTB may request further information about ingredient and production on a case-by-case basis. TTB also requires that brewers label their beer accurately so that ingredients and brewing processes are not misleading. For more details about what has changed, see TTB Ruling 2014-4 and its attachments for a complete list of exempt ingredients and acceptable labeling. For even more positive feedback on this ruling, check out the Brewer’s Association’s response.

Don’t wait! Kansas Product Renewals are Live

It’s that time of year again; the Kansas label renewal period is upon us. Kansas has pushed the renewal period back by a month this year so licensees will be able to renew previously approved labels from June 1st through July 31st.  But, that doesn’t mean that you should procrastinate! Just like last year, Kansas will be utilizing the PRO system to offer a quick and easy substitute to laborious paper submissions. Licensees will be able to submit electronically with three simple steps; check which products they would like to renew, review the selection, and make a payment. It should take only a few minutes to complete. That will be one more item checked off your to-do list.

Take Control of your Fulfillment Processes

Making sure orders are up-to-date and within the boundaries of each state’s regulations can be a stressful and time consuming process every month. If you’re frustrated in any way with your current fulfillment processes, I highly recommend you take a look at ShipCompliant’s Fulfillment Management tools. We make it really easy to batch your club and daily shipments, print packing lists, check the temperature forecast for your packages, synchronize inventory levels, print shipping labels, and track packages, all while making sure that you stay in compliance with the laws, regulations, and reporting requirements of each state.

Fulfillment and compliance are highly dependent on each other. Some states require tracking numbers, carrier codes, and the name and license of the third party logistics (3PL) provider to be reported along with order data, which means your compliance department needs to know what orders have actually shipped, by who, and when.  ShipCompliant Fulfillment Management seamlessly sends your orders to any of our 20+ compatible and integrated 3PL partners or to your in-house fulfillment team for processing. Once processed, tracking numbers are added to your account to automatically and accurately update the actual date of shipment and shipment status directly from the carrier so that orders can be accurately reported to state agencies.

That’s not all. Since orders are immediately visible at your specified fulfillment location through ShipCompliant’s Fulfillment Management page, any issues with an order — such as insufficient inventory or unsafe shipping temperatures — can be flagged by your fulfillment location or shipping department for you to view in real time and work together to resolve.

Once orders are shipped and tracking numbers are added into ShipCompliant, they are immediately available and ready to go to work! ShipCompliant’s real time integrations with the UPS, FedEx and GSO tracking services alert you of any issues marked by the carrier, such as failed delivery attempts, undeliverable packages, and much more, so you can prevent spoilage, returns, and be proactive with your customers. There are also valuable Analytics reports available to analyze your delivery metrics, unshipped orders, and delivery attempts, to name a few.

Lastly, there is no need to manually update order information in your eCommerce, wine club management, point of sale, accounting, or third party systems. Certified and integrated systems will synchronize the most up-to-date order data from ShipCompliant, and in turn, have all information effortlessly updated for consistency across all systems.

Ready to get started? ShipCompliant clients have these powerful tools available within the Fulfillment Management page in their account already. If you have any questions or would like to receive a customized training session with our Client Service team, please contact us.

Don’t Delay – Renew your Arkansas Products by June 30th

Arkansas, the latest state to adopt wholesale label registration practices, has begun their first renewal period. The state recently sent out an email communication to all licensees with previously registered labels. Just in case you missed the email, here’s what you need to know:

  • The renewal period will run from June 1st through June 30th, and requires that all wine and spirit labels registered prior to March 1st be renewed. Labels registered after March 1st will be valid through the end of next year’s renewal period (through June 30th, 2015).
  • Renewals should take only a few minutes. The renewal fee is $20 per label.
  • Renewals must be performed electronically and can be completed in bulk here: ar.productregistrationonline.com/renewalslogin.
  • New labels (not renewals) in Arkansas can also be performed with a ShipCompliant login. If you don’t have a ShipCompliant login, set up an account with ProductRegistrationOnline here: productregistrationonline.com
  • Arkansas Supplier Permits must be renewed prior to June 30, 2014. If you currently hold a Supplier Permit, you should have received a renewal notice.

Accelerating the Demise of Paper

In calendar year 2013, ShipCompliant generated over 200,000 reports (sales and use tax, excise tax, direct shipping reports, wholesale gallonage reports, markup tax reports) for our clients. These reports generated over 700,000 pages of paper that were printed and mailed across the country (with paper checks as well) to the various state agencies. On top of that, suppliers generated over 100,000 pages of paper from product registration packets. In 2014 we’re likely to exceed 1 million pages of paper generated by the software.

We introduced Product Registration Online (PRO) three years ago to create public-private partnerships with state agencies for electronic submission and review of registrations for alcohol beverage products. PRO is in place in 10 states right now, with many more on the way, and it’s changing the way that suppliers bring products to market. It’s also eliminating incredible amounts of paper, postage, and headaches.

Not only are paper mailings extremely wasteful, but they’re also inefficient, slow, and not visible, both for the suppliers and the state agencies. One state agency told us that it costs them $35 on average to process each paper check that comes in! Further, a compliance consultant that I spoke with recently said that nine out of ten “notices” that they get from the state agencies are disputes about when and whether the report and check were actually mailed and received. Countless hours of back and forth are spent just trying to prove whether the mailings went out on time. The only way that suppliers know that the state received the report successfully is by monitoring that the checks actually got cashed, a process that can often take several months.

We’re on a mission to eliminate paper from this industry.

Just last month, we introduced AutoFile, a capability that allows suppliers to put their reports on cruise control. We keep track of whether you’re filing monthly, quarterly, semi-annually or annually with each agency, and make sure your reports get filed on time and accurately, every time. Everything is fully visible and accessible electronically any time you need it, and fully reconciled with your accounting system. We’re creating integrations with 25 different agencies right now to establish automated connections for report remittance. AutoFile will change the way we think about reporting. No longer a task, it just happens.

PS – If you’re a state agency that is looking to automate your paper processes and want to learn more about PRO or AutoFile, please contact us.