Thanks to Cin7, this New Zealand hop company is able to forecast three years into the future.
New Zealand is known for its stunning landscapes and boutique products, but it’s not yet on the international map for its hop crop. However, if Hop Revolution has anything to say about it, that is about to change.
Hops, for the uninitiated, are a key ingredient in many beers. A relative of the much more famous cannabis sativa, hops contribute flavour, smell and the tasty bitterness that beer fans crave. Just like grapes and wine, hops have their own special characteristics depending on where they’re grown. With their unusually-high acidity and unique cool-climate flavours, the New Zealand crops that Hop Revolution takes to market are rapidly achieving cult status among craft brewers and their distributors.
“Hop Revolution is a relatively young hop-growing sales and marketing business,” says Hop Revolution Supply Chain and Sales Analyst, Nick Evans. “We have the view that we are going to scale up growing New Zealand hop varieties, and take that to brewers in export markets. At the moment, our hops go predominantly into the US, UK and European markets.”
Hops are a delicate product. The commercially valuable part is the unfertilized flowers, and for it to retain its qualities for successful export, hops must be carefully prepared within moments of being picked. This means each hop garden must have its own picking and drying equipment., where hops are processed into bales. Once this is done, the hops can be safely transported for further processing to export markets around the world.
That’s where the Hop Revolution starts. They manage two hop farms, and export the hops to brewers all over the world.
But the exacting nature of the product, as well as the vagaries of the commodities export market — where goods tend to be bought in large quantities and are often sold on consignment — means that good inventory management is critical. Hop Revolution have only been running for a couple of years, but they put Cin7 in place after the business had only been selling for only a few months.
“Getting something in place and helping us manage that inventory was pretty high up the list once we got started,” Nick says.
This isn’t the usual inventory management story. A lot of businesses wait until they’re well established before investing in cloud inventory management software, relying on spreadsheets or manual processes to bridge the gap. But, while spreadsheets are fine right at the start, once things get complicated, relying on them can throw business systems into chaos. Forward-thinking product sellers know that the best time in the business cycle to get started with inventory management is as soon as possible.
“It was that scaling factor, really,” Nick says. “It was pretty simple to begin with, but as soon as you start ending up in different markets, with three different distribution locations, and with consignment inventories in different countries, it’s a bit too complicated to manage it with a spreadsheet. Having a way to tie all that together is key.”
Nick’s background in farm technology and supply chain management meant that he was the perfect hire to look after Hop Revolution’s complex inventory and supply chain requirements. Luckily, Cin7 came recommended by a hop grower that already used the software.
“We did the full review across all the potential options out there, including Unleashed, and landed on Cin7 with the view that if we could tie it in with our other supply chain partners, then that’d make life a lot easier all round. It showed promise early on,” Nick says.
While it’s perfectly fine to implement Cin7 in your business without outside help, to get the most out of Cin7, the top product sellers either hire someone with expertise, or use a Cin7 implementation partner. Hop Revolution chose to use Powerhouse Solutions.
“We used an implementation partner to get us up and running, and that was really good,” Nick says. Despite not having as many products as some Cin7 users – Hop Revolution only had four to start with – the complexities of their market and selling methods meant that having outside help to get up and running was invaluable. What’s more, their implementation partner offered training to the staff members who needed to use Cin7, drastically reducing the time required to use the product to its full potential.
“The training aspect of it’s really important, I think,” Nick says. “You know, there’s a lot of buttons to click and there’s a lot of ways to do things. It’s good to have a bit of a steer out the gate, to have someone with knowledge and experience show us the way.”
Cin7 is now the cornerstone of a powerful software stack that powers the entire business, customised to their niche and needs. It functions better than an ERP — and without the enormous upfront and ongoing costs associated with legacy ERP systems.
“Our whole ethos at the moment is to run SaaS for anything and everything,” Nick says. “We’re hooked into Xero. We have a ShipStation integration. We’ve also got GoSweetSpot — because we’re shipping in three different countries at the moment, we’ve just got to have that flexibility to have multiple accounts for different shipping destinations. It’s really useful. Having it all integrate together with Cin7 is giving us that flexibility, ticking all the boxes, and kicking the goals.”
Cin7 has proved vital in efficiently managing Hop Revolution’s sales process. After they’ve produced a batch of hops, much of their stock gets allocated to a purchase contract, which may or may not be drawn down for up to 12 months or more.
“It sits in inventory for quite a long time, but it still can’t be sold because it’s allocated to a customer,” Nick says.
Because of this, Cin7’s Open to Sell functionality is a god-send. It means Hop Revolution always knows how much of their stock they can sell to new customers, while still completing open orders. “We love the order tracking and Open to Sell, as it’s pretty powerful for knowing what’s available to sell.” Nick says.
Cin7’s market-leading reporting capability is also hugely beneficial, giving Hop Revolution — which often has stock in multiple stages of production and sales all over the world — the transparency it needs to to make decisions.
“We pull a lot of reports,” Nick says. “It’s useful to be able to have multiple locations and manage inventory in all the different ones. Of course, that’s what all inventory solutions do, but the beauty of Cin7 is it’s flexible and customizable, and the guys are great at tweaking stuff if you ask for it.”
Nick says the most mission-critical feature of Cin7 is the way it allows them to maintain order integrity right across the supply and sales chain. As sellers need to be able to order up to 48 months in advance of receiving goods. Cin7 allows Hop Revolution to load in a sales order “then and there” and track it in advance, into the future.
“That’s got a lot of value to us. Pricing fluctuates year to year, but if we know that that customer’s pricing on that day is locked in, then that gives us good traceability back through the process,” Nick says.
“The orders we process are relatively high value. And it’s reassuring to sit securely in the knowledge that Cin7 is storing those orders that have been placed years before.”
Once Cin7 had been implemented for a while, it became a treasure trove of historical data on how Hop Revolution’s business operated, giving them the ability to tweak their existing operations for maximum efficiency and make predictions about the future.
“It’s not hard to go back and track and trace stuff with a few clicks. That to me is really powerful when you’re just trying to work backwards and see what’s gone on,” Nick says. “Now, we can start to forecast three years into the future, where our demand is, and do it via location, and do it by customer. It’s one thing that is really crucial, and means I can sleep at night.”
Since the Covid-19 pandemic disrupted supply chains worldwide, product sellers are scrambling for more visibility into their operations, so both they and their customers can stay across shocks. For this, Cin7 has been absolutely critical. It can’t make the ships sail faster, or clear backlogs at ports, but it can tell you exactly where your inventory is at any point in time, and allow you to set customer expectations.
“I think it’s everything, right? You’ve got customers who are relying on you getting orders right, and getting them to them at the right time. We only act as an agent for our farm owners, so we need to be able to show them that we’re managing their inventory in a good way, and accurately, and keeping track of all of it all,” Nick says. “For me, a really good aspect of Cin7 is being able to pull a report out of the program, and show our customers what’s happened and where it’s happened.”
The upshot, Nick says, is that Hop Revolution’s customers know when they’ve placed the order, that the order is being tracked well, and that they’re going to deliver when they say they’re going to deliver. And when things go wrong that are outside of Hop Revolution’s control, then it’s easy to keep customers across events.
“The great thing with Cin7 is, you can update customers in bulk, you can keep people in the loop. It’s useful to be able to send out a bulk email and just say, “Hey. Look, this stuff’s been delayed. Here’s an ETA.”
Hop Revolution is happy to recommend Cin7 to other commodity businesses looking for an inventory management solution. Before choosing a solution, Nick suggests “looking at the software pretty hard,” and making sure that you have your workflows and product journeys mapped out so you can test them against the software’s functionality in a demo environment.
“Get an implementation partner, or get a solid work plan in place to demo through all the scenarios you can,” Nick says. “Don’t worry so much about the customization and stuff to get you started because that can come down the track. Just get that real core workflow nailed down first.”
Hop Revolution says that the time invested in understanding how your business processes tie together in Cin7, as well as training in and learning the software, will reap huge dividends for the business down the track. Reporting is a critical aspect, and can be customised to an individual business’ needs.
“Cin7 is a handy tool for giving you that visibility. That’s one of the key parts of running a good supply chain, right? It gives you the ability to track and trace, and shows what you need to know at any given time. And I think that’s really powerful. It’s awesome,” Nick says.
“It’s a solid product and it just keeps getting better. It comes with my recommendation.”