Liquor distributors in the US

Absolutely not. Where I live, it is actually illegal to buy liquor from a store with the intent to resell on a business level. We are required to purchase through distributors.

In control states (e.g. Virginia), restaurants and bars have to place liquor orders through ABC stores and pick it up themselves. Regardless, I think this should be the responsibility of ownership/management unless the hourly guys are being compensated well

You will be assigned an agency and all of your high-proof spirits must be purchased from that store. You will order online through the OHLQ wholesale portal and the cost of each bottle is retail -5% with no sales tax charged. You don't have to order anything by the case unless it is specifically listed that way because it is wholesale only. If your agency doesn't have a product you want available in Ohio, you can try to have it transferred to your agency or take a copy of your d3 or d5 license to another store and they can help you create an order there.

I’m not sure specifically how California works. But in general someone already has the rights to sell any of the big brands in your area. So you either need to come to an agreement (basically buy out their rights), or just approach local breweries who aren’t distributing to start selling their products. This whole process involves a lot of connections and a lot of work. If you did this and then had a decent portfolio that doesn’t cost you a ton to acquire, now you’ll have something to sell. This whole process will be a way bigger expense than what a licensing fee will cost. And you will end up with a bunch of new breweries or breweries that no one wants. In terms of liquor, it’s pretty much impossible to acquire a brand that anyone knows without a ton of capital. This would be my main concern. What am I going to sell and how am I going to acquire the rights to sell it

South Carolina sucks. Strict three tier. Brewpubs can’t participate in festivals (due to the three tier system). Can’t open a second location and transfer beer between (due to the three tier system). I pay at least 3x more per month in “excise” (sales) tax than I do per quarter to the feds. The Lt. Gov gave a keynote to a room full of brewers and brewery owners and lauded the states response to covid and the small business friendly nature of the state. Half the room laughed, the other half rolled their eyes.

It is a lot more complicated than that. I know in my state (NY), you have to have a "retail" license to sell to individuals, and businesses with "retail" licences can only buy from companies with "wholesale" licenses. No entity can hold both a retail and a wholesale license. The single Costco warehouse in NY that sells liquor holds a retail (not wholesale) license. It really depends on state, and I believe that other states have similar license structures as NY.

I’m a beer rep and it’s pretty similar (although liquor tends to pay more than beer). I really like working in the alcohol sales side. Does your rep work for a distributor or the liquor company? If you work for a distributor on a sales route you’ll engages regular set of 30-60 restaurants/bars and maybe some liquor stores depending on how the distributor divides up the accounts w/ eligible liquor licenses. If you work for the supplier your job tends to be key account management across a larger territory. You will only push a specific brand. You’ll interact with your distributor reps who have a ton on their plate. I’ve worked both sides and think distributor repping is easier but supplier repping gives you more freedom in what you do say to day.

Bar reps don’t do much anymore if you’re in an ABC control state. They basically tell you which brands they carry and they make you posters or table tents for a certain liquor they may carry like Tito’s. If they carry a tequila like Teremana or espolon, they’ll make you posters for cinco de mayo and maybe some goodies for customers like necklaces, sunglasses, or t shirts. They try to woo you over by bringing you t shirts for staff or fruit garnish holders. That’s pretty much the extent of what they do lol. No need to feel pressured. They’re more of a nuisance than anything lol.

Former restaurant manager and current liquor rep here. A good rep will be able to help you with your beverage program to give you high-quality products at a fair price. They can let you know what’s working in similar restaurants in the neighborhood and give you a heads up as to what new products are coming or are available. I would recommend being nice but also honest. If there’s nothing you need just say it. We’re happy to be a regular at the bar and spend too, if a restaurant manager or buyer is nice to us.

They'll call you most likely on order day. Remember they're salespeople, not friends. No one is more "friendly" than a liquor rep.

As a liquor rep, you're mostly not wrong, but there's a few customers who I actually genuinely enjoy talking to and trying to introduce something good, and not just for my numbers

I’ve been on the liquor distributor side for a decade. You typically have to have an “in” to the industry. There aren’t many advertised jobs out there, at least not for my company. The last three folks I hired were all friends of current employees. I was hired out of the service industry (the sales rep for the bar I worked at was my “in”) and spent 2 years as a merchandiser, 4 years as a sales rep selling wine and spirits, and been a manager for almost 4 years now. Money seems to be a lot more consistent than in some other sales gigs, but I would say average for our reps is in the $70k range. I live in a very affordable part of the US tho, so $70k here is a decent wage. We have some reps bringing in more than $100k but they are not common.

Sold Tito’s as a rep for 3 years. There’s no such thing as “free booze” that’s very illegal federally. So companies offer deals and discounts and handshake favors. We ran a buy 4 cases, get a 5th case at no charge deal. Some companies offer BOGO. Sometimes it’s a monthly promo. Liquor reps want, like, 3 things. Consistent sales of their main product, the opportunity to make new placements, and the opportunity to host feature events. That means menu placements, monthly drink features, and quarterly “Tito’s nights!” Or something. If the rep works for a company with deep pockets, they may host an event and buy a few shots/cocktails for patrons and put it on the company card. Because again. It’s VERY illegal to just hand you a case of liquor for free. In some states, it’s illegal for them to buy a DJ or something in return for you putting them on the menu. That doesn’t stop companies from doing it, but there are other distributors that will refuse because it’s technically illegal and they’re not risking their license for a $500 DJ.

As a general rule you’d like to see your liquor cost between 18-20%. It’s a way of telling what % profit you are making on liquor. A 20% cost means you are profiting 80%. If the cost is higher than what their target % is, it might tell them that there is theft, over pours or free drinks being given out. So yes, if their target was 20%, and it came back at 25%, it would mean that there is 5% lost/unaccounted for.

20% is a fine liquor cost. But it’s an average. The trick is to charge 5 bucks for something that you could make your margin charging 3 bucks. When you do that, your Jameson or whatever of the world you can charge 6 bucks for instead of 7, and it averages out. Hope my made up example was clear

The distributor is expected to pickup product, sell it, keep product rotated properly, and get your kegs back. Expect them to be the absolute worst at every aspect of this all while handing them a significant chunk of your margin.

Introduce yourself to all your alcohol reps ASAP know what days deliveries come in and deadlines to put in orders. I'd recommend receiving all the first few orders yourself and triple checking those invoices. Definitely also need to do a count of inventory on your own time, what's on display in your bar and what you have backed up in storage. Spirits don't go bad so over ordering a couple of bottles your first couple of times is fine, if not you can totally send back cases until you figure out your pars. Lastly, have all staff you're in charge of scheduling resend you their availabilities so you have it in writing and can take care of your full time people first and fill in the gaps with part timers. Lead your team by example, everything else will come with time and remember everyday is a learning experience.

I think it depends on the product. In the beer side IMO 20% is great for the cheaper beers but if you start selling some premium beers your margin will be big enough to subsidize it a bit. IE my can cost on Delirium Tremens is 3.97 but there is no way I will be charging $19 for it. I would rather sell it for $10 and still make more margin than a can of Busch that I sell for $5

There are plenty of distilleries/ NDPs already gouging to secondary prices. I think that’s a big turn-off to some consumers. Boss Hog from Whistlepig is over $500 a bottle. Barrell Gold Label is $500 and just in the last year, $200 pricing has become more “normalized” in the industry. Demand is significantly outstripping supply, as indicated by how many new NDPs are putting out underaged, 3-5 year old distillate, rushing to get it to market rather than aging it another few years (and gouging prices on that grainy, underaged bourbon while they’re at it). The thing is, allocation is just a measure of supply. Allocation means store A is only *allocated* to receive X bottles of allocated release because they bought ___ cases of unallocated bottles from their distributor in the last few months. In the three tier system, distributors hold distribution of allocated bottles hostage, contingent upon sales of unallocated stuff. Hence stores have pallets of Wheatley vodka that they begrudgingly bought to get access to BT products. The allocated bottles are tied to volume sales of cheaper releases

EDIT FOR OP: A question I forgot to ask - are you looking to have a distributor take over your current self-distro list and also expand, or are you looking for a distributor to take over any *additional distribution* or distro out of your range? Not sure what distributor laws are like where you're at, but I'd probably start out by reaching out to other breweries that use the distributors you're considering to see what they like or don't like about who they're partnered with. When considering distributors, take their current portfolio and sales team sizes in to account. Try to note the visibility of similar sized breweries out in the market and if they are self-distro or use a distributor. No matter what, I'd still hire some kind of sales manager or director of sales if you don't have one. Where I'm located, breweries that have some sort of representation in the market tend to be more visible than those that don't (that spans national, regional, state, local/self-distro).

Yep. Our owner has been floating the idea of signing up with a distributor for a while and I keep telling him not to. It was miserable dealing with them at my old brewery and awful on the sales side too when I worked at a liquor store years ago. If you’re a smaller craft brand, they won’t care about truly pushing your product while simultaneously wanting a ton of product that will sit in their warehouse until they realize it’s out of date. I should say though, this is my experience with a large distributor. If you can find a small distro company that only focuses on craft (like Crooked Stave’s), it’ll probably be a better experience.

Every place does things differently! I work at a craft beer spot, and our only real rule is that we only can only tap beer from independent craft breweries. Beyond that, we pick and choose based on what's available, and what we like/think will sell. Keep in mind that you usually have to purchase through a distributor, which also limits you to what they offer. My personal rule is to always have a balanced draft list: at least one pilsner, an IPA, a dark beer, a sour beer, and something exciting/rare (like a barleywine, or a new collaboration). Sometimes we do mini tap takeovers with certain breweries, or do themed takeovers (all one style, or all from a certain state, that kind of thing). With the ever growing amount of beer out there, it really comes down to what product you can get your hands on, and what brands you want to support.

As a small craft distillery owner in NC, the ABC system does need a lot of work and has vast room for improvement. However, for small companies like mine, it also has advantages. If we went fully private, most of us would lose shelf space because we don’t have 100s of sales people to meet with every individual store owner and constant renegotiate pricing. The state system is broken for sure, but the laws need to change to allow for a more free market. I would highly advise reaching out to your local craft distillery and ask them what they would want you to say to your legislators and how best to support them. That makes a world of difference for small business owners like me trying to navigate such a bureaucratic system.

They will find you. Otherwise, just search for wine distributors/wholesalers in your state and reach out to them. I would advise you to work in a wine shop or wine bar part time for a bit before diving into the business idea. You’ll gain all the connections you need plus a much better grasp of how things run.