Andres Correa, Content Specialist at Park Street, examines the current alcohol distribution landscape in the U.S. and breaks down the three-tier system, the major trends around distribution, and the major alcohol wholesalers in the country.
A Look at the Current Alcohol Distribution Landscape Transcript
Andres Correa (0:01)
Behind every bottle on the shelf is a complex distribution system that can be the determining factor in whether or not a brand succeeds. Today, we’re taking a look at the alcohol distribution system in the US—how it works, who the key players are, and the trends driving the industry.
Andres Correa (0:21)
The three-tier system is the backbone of alcohol distribution in the US. Created after Prohibition to prevent market domination, it ensures that each tier remains financially separated from the others. Tier one consists of the producers, such as breweries, wineries, and distilleries. Tier two contains the distributors, also known as wholesalers, who act as the middlemen. Finally, tier three is made up of the retailers, including bars, restaurants, liquor stores, and supermarkets where legal drinking age consumers buy their drinks.
Andres Correa (1:10)
The biggest ongoing trend in the distribution market over the last few decades has been market consolidation. The industry has seen a massive wave of mergers and acquisitions, with smaller distributors being bought up by larger ones. In 1995, at the beginning of the US wine boom, there were approximately 3,000 wholesalers in the US market. By 2023, that number had declined drastically to closer to 1,000 operating wholesalers.
Andres Correa (1:43)
Why does this matter? It creates significant challenges for small producers trying to get attention and secure shelf space. However, regional and independent wholesalers, along with self-pitch distribution platforms like Park Street, have stepped up to fill the void for emerging brands. For more information on self-pitch distribution, check out the link to the video in our description.
Andres Correa (2:07)
So, who are the biggest players in alcohol distribution right now? The top three giants control a significant portion of the market. Southern Glazer’s Wine and Spirits is currently the largest distributor, spanning over 45 states and Washington, D.C. Republic National Distributing Company (RNDC) follows with a massive portfolio spanning 39 states and D.C. In third place is Breakthru Beverage Group, a major player operating across 16 states and D.C.
Andres Correa (2:42)
While these giants dominate, they’re not the only options. Regional distributors and independent players still play a crucial role in keeping the industry diverse. If you’d like to learn more about large regional or independent distributors, or self-pitch distribution platforms like Park Street that offer back-office services, check out the full guide to US distribution in the description below. Thanks for watching.
Watch our previous video on Self-Pitch Distribution