I met this week with a group of distributors out in Boston. Though it’s not widely known outside of the beverage alcohol industry, distributors play a key role in public safety as it relates to beer, wine, and spirits.
Beverage alcohol is the most heavily regulated industry in America. In an effort to curb the abuses that led to prohibition, the federal government in the 1930s established a tightly-controlled system the regulates how intoxicating beverages go from manufacturer to consumer. In general terms, it’s a three-step system. Manufacturers (like the Veteran Beer Company) have to apply for and be granted federal permits to make beverage alcohol. These licensed manufacturers may only sell products to distributors that are licensed in individual states. Our first two distributors are Flyer in Illinois and Monarch in Indiana. The distributors, in turn, may only buy from licensed breweries, wineries, and distilleries. The distributors (the middle step in the process) may then sell the products only to retailers that are licensed by the states and municipalities in which they do business.
The retailers may only buy product from licensed distributors and may only sell to “licensed” (of age) consumers.
While it’s not a perfect system by any means, it is the best in the world at ensuring that the broader interests of the public and public safety are placed above the purely commercial interests of the businesses involved. Applying and being approved for permits and licenses in each of the three steps is an involved process that does a good job of ensuring criminals (and those connected to criminals) are kept away from the controlled product. Because the licenses are hard to get, those involved work hard to do nothing that might jeopardize their permits. The product is pure, the taxes are paid, and the system generally does a good job of keeping beverage alcohol out of the hands of minors.
As the middle tier, distributors arguably have the most important role in the system. That most Americans have no idea what they do speaks to how well they do it. The efficiency with which distributors do their jobs is reflected in the fact that Americans enjoy the widest choice of beverage alcohol at some of the world’s most affordable prices.
The Veteran Beer Company is proud of our expanding relationship with the nation’s leading distributors.