Published reports on Milo’s Tea Co., Inc. state it is the largest seller of refrigerated tea in the United States, serving more than 13,000 retail outlets in 45 states. These figures point to a rapid expansion from 13 states in 2014. Sales topped $125 million in grocery and multi-outlet locations in 2018, according to Chicago-based market research firm IRI.
The company’s recentannouncement that in 2020 it will open a newmanufacturing hub in Tulsa, Oklahoma indicates both a substantial increasein capacity over its headquarters facility in Bessemer, Alabama but also, inthe view of a number of commentators, is part of Milo’s focus on innovation indistribution to leverage its product growth and market expansion.
That growth has been built andmaintained on its family tradition, beginning in 1946, for making anoutstanding sweet iced tea that followed the founders’ recipe of filtered water,fresh-brewed tea and sugar, with no added preservatives, coloring or flavorings.One commentarydescribes it as “the nectar of the south.” It adds that “the name has becomesynonymous with sweet tea itself in some parts. In Alabama, at least, the teahas an almost cult-like devotion.”
Until 2013, that reputation andoperations were largely centered in the South. Milo’s facility in Bessemeroccupied 30,000 square feet on 3.5 acres in 2002and was expanded to 150,000 square feet on 15 acres by 2018.The Tulsa Distribution and Production Center, scheduled to open in September 2020,adds 108,000 square feet. The Governor of Oklahoma, Kevin Stitt, pointed to thevalue of Tulsa’s location in its Western expansion. The company’s CEO, PatriciaWallwork, stated inthe same article that this second production facility is “critical”in this regard and “fundamental” for extending its geographic footprint.
Up to 2014, Milo’s sales camealmost entirely from its range of four iced teas. Its CEO was quoted in 2014 asstating Milo had launched just fivenew products in the previous nine years. Since then, it has addedmany. It entered the organics market in 2014, with USDA-certified “caféstyle” teas, lemonade, Splenda-instead of sugar-sweetened varieties, peachtea and an energy boosted tea, M59, targeted to students.The focus on all-natural remains core. Milo’s won or has placed in the NorthAmerican Tea Championship (now renamed the Global Tea Championship)for seven consecutive years from 2001-2017.
Milo’s has not released detailsof its plans. Observers have noted developments relevant to extendeddistribution. Its Bessemerdelivery fleet prior to 2009 operated as a direct-to-store private licensedand bonded operator within a 100-mile radius of its Bessemer production base, using12 refrigerator trucks. The company outsourced delivery to wholesale dairydistributors for longer distances and to meet the just-in-time demands of majorretailers.
Moving to what is termed 3PL(third-party logistics) in a dedicatedcontract carriage arrangement with Ryder Supply Chain Solutions,Milo’s is reported to have reducedcosts by 20% and mileage by 25%. The Milo’s-Ryder collaboration wonan awardin 2011 for 3PL logistics excellence. Descriptions of the systemreference onboard IoT (internet of things) cab-to-hub connectivity, demand-surgemanagement and optimization engines. Ryderlists advantages for Milo’s that shift lean supply chain fromasset-intensive 3PL to resource-allocative 4PL. In early 2019, Milo’sposted a public job application for a managerof lean operations.
The Tulsa facility is located inthe CherokeeExtension Industrial Park.
SOURCES
Alabama Newscenter, AreaDevelopment, Birmingham Business Journal,Cerasis, Food Business Africa, InboundLogistics, Investor.ryder.com, LinkedIn, Over The Mountain Journal, ShelbyReport, Shopify, Southern Living,Thisisalabama.com, Tulsa World