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.

Shifts in Beer Consumption

Beer’s market share of alcohol consumption is slowly declining due to competition from wine and liquor, as well as health consciousness.

Industry size & Structure

The average beer distributor operates 1-2 warehouses, employs 79 workers and generates about $48 million in annual revenue.

    • The US has about 1,400 beer distributors with annual sales of about $68 billion and about 111,500 employees.
    • The largest populations of beer distributors include California (164), New York (125), Pennsylvania (104), Texas (110), Florida (77) and Illinois (62).
    • Average inventory is about $5 million.
    • 77% of distributors employ less than 100 employees.
    • Top distributors in the US include Reyes Holdings, Goldring Gulf Holdings, 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 8,884 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

                                      Dec 7, 2022 - Beer Wholesalers Are Pessimistic
                                      • Price increases, layoffs, and the slowing US economy are conspiring to depress beer sales and the outlook among beer wholesalers. The National Beer Wholesalers Association’s (NBWA) Beer Purchasers’ Index (BPI) for November 2022 shows a low reading of 38 compared to 52 in November 2021 and the “at-risk” inventory index is relatively higher at 49. (A reading below 50 indicates the segment is contracting.) The continuation of lower BPI readings and low “at-risk” inventory are indicative of lower expected sales. The imports index continues to point to expanding volumes for the segment with a reading of 59 in November 2022, while the craft beer index at 25 is well below the November 2021 reading of 47. Notably, the below premium index measured 47, significantly higher than the November 2021 reading (29), and continues to be the only segment to report a higher reading over 2021.
                                      • Distributors that rely on diesel-powered trucks to deliver beer are facing a potential shortage of diesel fuel that has driven up the price to a record premium over gasoline and crude oil. While the price of gasoline is up about 14% so far this year, the price for diesel has risen by about 50%, to $5.35 a gallon, according to energy price data from AAA/OPIS. The gains widened the gap between the two fuels to an all-time high of $1.61, versus 23 cents a year ago. Dwindling stocks, the war in Ukraine, severe weather, and other disruptions to the global energy markets are behind the widening gap, WSJ reported in November 2022. The Energy Information Administration in November reported the country had only 25 days of diesel in reserve, the lowest since 2008.
                                      • Craft breweries are among those industries driving the resurgence in US factory employment. Unlike previous recessions that ended with a net loss of factory jobs, the unique circumstances of the pandemic-induced recession and recovery have resulted in a net gain in factory jobs – although not in the sectors or regions typically associated with manufacturing, The New York Times reports. American manufacturers eliminated roughly 1.36 million jobs from February to April of 2020, as the pandemic shut down much of the US economy. As of August 2022, however, manufacturers had added back about 1.43 million jobs, a net gain of 67,000 workers above pre pandemic levels, according to data cited by NYTs. The newly-created jobs are more apt to be located in the Mountain West and the Southeastern US than in traditional industrial strongholds.
                                      • Citing public health and safety concerns, the National Beer Wholesalers Association along with distributors of wine and spirits are urging lawmakers to oppose the United States Postal Service Shipping Equity Act (HR 3287). The pending bill, if passed, would bypass distributors by allowing the USPS to mail beverage alcohol products directly from licensed producers – including breweries, distilleries, wineries, and cideries – to legal-drinking-age consumers in states that allow direct-to-consumer alcohol shipping (DTC). The bill’s opponents cite dangers including increased underage access and increased access to dangerous counterfeit products that could result from DTC models of distribution.
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