Sales Velocity vs Points of Distribution: Which Matters More?
Every brewery wants more placements - but more isn’t always better. Getting your beer into more bars, taprooms, or stores only helps if it’s actually moving. If your product is sitting still, it’s tying up cash, risking freshness, and damaging your brand perception. That’s why tracking how fast your beer sells, and using that data to guide your decisions, is more important than chasing distribution for its own sake. Before you expand your reach, dial in your performance.
Understanding the Key Metrics
Points of distribution (PODs) matter, but don’t overemphasize them at the expense of velocity. Sales velocity is what drives profitability. Expanding your distribution without solid velocity can wreck your margins and stretch your resources too thin. Focus on optimizing your existing accounts before expanding, and you'll see better long-term returns.
If you sell through a distributor, there are two key metrics to track: sales velocity and points of distribution. Both are important, but they tell you very different things. Misunderstanding their impact can lead to wasted effort and missed opportunities.
Sales velocity measures how quickly your beer moves at each account. It’s typically calculated as:
Total bbl shipped ÷ Weeks since shipment
Higher velocity means faster turnover and stronger demand. Lower velocity often means your beer is just sitting there, tying up shelf space and cooling distributor enthusiasm.
Points of distribution, on the other hand, tell you how many accounts are carrying your beer - bars, restaurants, retail stores, etc. More PODs means broader reach. But that doesn’t guarantee good performance. If your velocity drops while your PODs increase, your overall efficiency and brand health can suffer.
Here’s an example: You double your PODs from 25 to 50, but your average velocity drops from 4 bbl per week to 1 bbl per week. Total volume stays the same - but your workload, support needs, and risk all will spike.
Look for the sweet spot: high-velocity PODs. A healthy sales velocity is typically 3–6 bbl per week, depending on the style and the account type. If it consistently drops below 2 bbl, that’s a red flag. Maybe the market is oversaturated or your distributor is targeting the wrong accounts.
Prioritize depth (velocity) before breadth (distribution). A handful of high-performing accounts will do more for your margins, brand perception, and operational stability than dozens of underperformers. Track both with the Sales Velocity Tracker to get clear insights into what's working and where to improve.
Sales Velocity Tracker spreadsheet
Deciding When to Expand vs. Optimize
As your brewery grows, you’ll hit a point where you have to decide: do you go deeper with your current accounts or try to land new ones?
The answer isn’t always “add more accounts.” Before expanding your PODs, make sure you’re getting the most out of your current placements. Otherwise, you risk building on a shaky foundation.
Here’s a simple rule of thumb: optimize depth before expanding breadth. That means increasing volume from existing accounts before spending time, energy, and money chasing new ones.
Let’s say your average velocity is 4–6 bbl per week. That’s a strong signal that your accounts are healthy and could support expansion. But if you’re below 2 bbl per week? Expansion may just spread you thinner. Instead, work with current accounts to improve movement. What’s missing? Can you support them with marketing or better product mix?
Run a quick return on investment analysis. With the Sales Velocity Tracker, you can calculate average net revenue per account. Then estimate your cost of acquiring and supporting a new account. Things like sales rep time, promo materials, etc. (delivery costs should already be factored into net revenue).
Now ask: would it be smarter to add 4.5 more bbl per month to existing accounts - or chase 3 new ones that might underperform?
For example:
Current account: 4.5 bbl per week × $160 per bbl = $720 per week = $3,120 per month
New account: slower ramp-up, more support, possible discount pricing
Sometimes the better move is helping an existing account reorder two weeks faster, not chasing unproven ones.
Use the Sales Velocity Tracker to run scenario analysis:
What happens to net revenue if velocity increases 20%?
What’s the breakeven point for a new account with higher shipping costs?
How does a slower reorder cycle impact your cash flow?
Even simple spreadsheets can give you powerful visibility into what’s really working.
Depth vs. Breadth
If you're building a brewery for long-term success, start with velocity. Expansion might feel exciting, but if your beer isn’t moving, you’re just compounding inefficiency.
A smaller footprint with strong, consistent reorders will always outperform a scattered one with slow-moving placements. Stale inventory leads to markdowns and bad impressions.
Stick with the accounts that already trust you. Consistent inventory turnover earns you more shelf space, builds brand equity, and gives you a rock-solid foundation for profitability.
