Beer Distributors

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 1,400 beer distributors in the US are the middlemen between the suppliers (breweries and importers) and the retailers (grocery stores, convenience stores, bars, restaurants, sporting venues etc.). Distributors must provide climate-controlled storage, transportation, and maintenance for perishable malt beverages from the time they leave the brewery until they arrive at the retailer.

Competition from Larger Distributors

Beer distributors are typically small, local operations, but the industry has been consolidating as larger distributors expand through acquisitions.

Declining Market Share

Beer has been gradually losing market share since 2000, when it accounted for over half of all beverage alcohol sales.

Industry size & Structure

The average beer distributor operates 1-2 warehouses, employs 80 workers and generates about $48.5 million in annual revenue.

    • The US has about 1,400 beer distributors with annual sales of about $68 billion and about 112,000 employees.
    • The largest populations of beer distributors include California (209), New York (173), Texas (169), Florida (141) and Pennsylvania (117).
    • Average inventory is about $5 million.
    • 77% of distributors employ less than 100 employees.
    • Top distributors in the US include Reyes Holdings, Goldring Gulf Distributing, Ben E. Keith Beverages, Silver Eagle Distributors LP, and Manhattan Beer Distributors LLC.
    • The number of breweries that supply the distribution industry is rapidly increasing. Currently, there are about 9,700 breweries in the US, up from 250 in 1990 and 2,300 in 2010.
                                      Industry Forecast
                                      Beer Distributors Industry Growth
                                      Source: Vertical IQ and Inforum

                                      Recent Developments

                                      May 20, 2024 - Wholesalers Continue to Hike Prices
                                      • The producer price index for beer, wine, and distilled alcoholic beverage merchant wholesalers, which measures prices before reaching consumers, rose 5.9% in March compared to a year ago after rising 11.3% in the previous annual comparison, according to the latest US Bureau of Labor Statistics data. Wholesale prices continue to rise – albeit less dramatically – despite lackluster sales. Seasonally-adjusted sales for beer, wine, and liquor distributors fell 0.4% In February but jumped 12.9% from the previous month (Dry January), according to the Census Bureau. Employment by beer and ale wholesalers grew 2% in March year over year, while average industry wages fell 2.1% over the same period to $25.46 per hour, per the BLS.
                                      • The number of craft breweries in the US continued to rise in 2023 despite a tough year for the industry, the Brewers Association reported in April. In 2023, the number of operating craft breweries reached a record 9,761, including 2,092 microbreweries, 3,502 brewpubs, 3,910 taproom breweries, and 257 regional craft breweries. There were 495 new brewery openings and 418 closings. Openings fell for a second straight year, reflecting a more mature market. The closing rate increased but continued to remain relatively low, at approximately 4%. Collectively, small and independent brewers produced 23.4 million barrels of beer in 2023, a decline of 1% from 2022. However, craft’s overall beer market share by volume grew to 13.3%, up from 13.1% in 2022, as craft’s declines were smaller than overall beer volume losses, per BA production data.
                                      • The Alcohol and Tobacco Tax and Trade Bureau (TTB) is considering major revisions to labeling regulations that would affect beer makers, the Brewers Association (BA) reports. Potential changes under consideration by the TTB include mandatory disclosure rules for alcohol content, major allergens, nutritional information, and ingredients. While the BA says it generally supports the disclosures under consideration, which, as in the case of the “big nine” allergens, convey information important to certain consumers, it expressed concern that labeling rules should not unfairly burden small brewers or suppress innovation and creativity and should include reasonable accommodations for small-batch products from producers of all sizes, according to a press release. In comments to the TTB, the BA also recommended that materials consumed or bio-transformed during production or added as processing aids should be excluded from labels if not present in the finished product.
                                      • While small compared with traditional beer segments, non-alcoholic beer is having an outsized impact on the overall US beer market, according to the 2024 Beer Report from Beverage Industry (BI). The proliferation of non-alcoholic beer has allowed the category to retain consumers as beer faces increasing competition from spirits and other alcoholic beverage options, per the report. “Non-alcoholic beers are benefiting from switching within the beer market, so these products are likely aiding in beer buyer retention,” say insight consultants for market research firm Circana. Beverage analysts attribute the rising sales of non-alcoholic beer to better quality and taste and a generational shift in drinking culture, with younger consumers, in particular, drinking less. Given the increase in sales of non-alcoholic brews, beer distributors may want to stock more non-alcoholic beers to compensate for flagging sales of their alcoholic counterparts.
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