First Research US Industry Profile

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Beer, Wine & Distilled Spirits Wholesalers
SIC Codes: 5181, 5182
NAICS Codes: 4248
Last Quarterly Update: 7/19/2021
Companies in this industry distribute beer, ale, wine, and distilled spirits on a wholesale basis. Major companies include Breakthru Beverage Group, Johnson Brothers, RNDC, Reyes Holdings, and Southern Glazer's Wine and Spirits (all based in the US); as well as Brindco (India), C&C Group (Ireland), Eastern Empire Distributing Co (China), Endeavour Drinks Group (Australia), and Nihon Shurui Hanbai (Japan).
Demand for beer, wine, and spirits is increasing in emerging economies worldwide and creating opportunity for alcohol wholesalers. Africa, the Asia/Pacific region, and Latin America are key growth markets for the alcoholic beverage industry.
The US beer, wine, and spirits distribution industry includes about 4,500 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $170 billion.
Competitive Landscape
Beer, wine, and spirits wholesalers are adapting to regulatory changes in several US states that have made it easier for beverage manufacturers to sell directly to retailers and individual consumers. Online sales and direct shipping are now permitted in some areas, and on-demand alcohol delivery services have further blurred the lines of the three-tier system that props up the industry. To compete effectively, distributors must avoid being bypassed by their suppliers while also updating their product mixes to align with evolving consumer tastes.
International competition is limited because most wholesalers operate regionally, and large beverage manufacturers often manage their own distribution networks in countries where that practice is permitted. However, some wholesalers have become more competitive in emerging markets by cultivating relationships with local beer, wine, and liquor companies, as well as major nonalcoholic beverage makers such as Coca-Cola.
Large wholesalers leverage their size and operational efficiencies to secure exclusive distribution rights in key markets. Small operators can compete effectively by distributing rare and premium products. The beer wholesale industry is fragmented: the top 50 companies account for about 40% of industry revenue. However, competition is more limited in local markets where large wholesalers have exclusive agreements with major breweries. The US wine and spirits wholesale industry is concentrated: the top 50 companies account for about 80% of industry revenue.
Competitive Advantages:
Brand Diversification — The growing craft beverage movement and declining sales of major beer brands have prompted many wholesalers to diversify their product selections. Companies that follow this strategy may appeal to upstart suppliers by offering specialized services and promotional support for new brands entering the market.
Modern Fleets — Many wholesalers have reduced costs and streamlined operations by replacing old vehicles with new models that are more fuel-efficient and require less maintenance. Some companies are incorporating more end-load trailers and small vans into their fleets to speed up delivery times. Distributors also use a variety of fleet-management technologies to plot more efficient routes and track inventories more accurately.
Consolidation — Large beverage wholesalers often grow through acquisitions rather than competing with smaller companies for market share. In addition to expanding a company’s geographic footprint and product mix, this strategy can help win business from major suppliers that are looking to minimize the number of distributors they work with.
Companies to Watch:
Southern Glazer's Wine and Spirits is the largest wholesaler in North America, with operations in about 45 US states, Canada, and the Virgin Islands. The company distributes for more than one-third of the wine and spirits market; it also distributes imported beers as well as cigars and nonalcoholic beverages.
Republic National Distributing Company, the product of a merger between Republic Beverage Company and National Distributing Company, is the second-largest US wine and spirits distributor. RNDC offers its suppliers a variety of services, including trade marketing and category management.
Reyes Holdings is a leading US beer distributor that operates out of about 30 facilities nationwide. The company also has an extensive international presence, with customers throughout the Americas, Europe, and the Asia/Pacific region.
Breakthru Beverage Group formed in 2016 through a merger between Charmer Sunbelt and Wirtz Beverage Group, a deal that significantly expanded the company’s geographic territory. Breakthru reports more than $5 billion in annual sales and participates in joint ventures with other large wholesalers, including Southern Glazer's and Young's Market.
Products, Operations & Technology
Major products are beer, wine, and distilled spirits although distributors tend to specialize in either beer or wine and spirits. More than 50% of overall ... plus:
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