Alcohol Distribution in the U.S.

Your path from production to pour

For wineries, breweries, and distilleries, distribution is the bridge between making a great product and getting it into customers’ glasses.
In the United States, this bridge is built on a complex web of federal, state, and local rules, along with a competitive marketplace where shelf space and menu spots are hard-won.

The traditional wholesale model is still the backbone of alcohol sales. However, new opportunities like Direct-To-Consumer (DTC) shipping and online marketplaces are changing how brands enter the market.

Understanding the fundamentals now will set you up for smarter growth later.

Understanding the basics: The three-tier system

The U.S. alcohol market runs on a legally mandated separation between:

1. Producers – wineries, breweries, and distilleries.
2. Wholesalers/Distributors – licensed companies that buy from producers and sell to retailers.
3. Retailers – bars, restaurants, and stores that sell directly to consumers.

Each tier operates independently to ensure fair competition and tax compliance.
While some states allow self-distribution for small producers, most follow the traditional three-tier route.

How the system is evolving

While the structure remains, state laws are slowly adapting:

• DTC shipping: Common for wineries, with growing access for breweries and distilleries.
• Self-distribution: Permitted in some states, often with volume limits.
• Online marketplaces: Connecting consumers to licensed retailers in a compliant way.

For brands, these shifts mean more options and more rules to navigate.

Building your distribution strategy

Before you start shipping cases, create a focused plan.

1. Choose your first markets wisely: Look for regions where you already have a story, contacts, or consumer interest.

2. Learn the rules: Licensing, brand registration, and reporting vary by state. Get these right before you launch.

3. Find the right distributor: Bigger is not always better. The right partner will understand your category and actively support your growth.

4. Create demand before you sign: Secure a few committed accounts, host tastings, and gather testimonials to show distributors you are worth their effort.

5. Support sell-through: Provide sales tools, marketing assets, and in-person account visits to keep product moving.

Considering Direct To Consumer (DTC) shipping

DTC is not a wholesale replacement, but it can be a smart add-on.

• Works best if your product type qualifies in multiple states.
• Useful for testing new markets before approaching distributors.
• Requires its own licensing, age verification, and compliance process.

If you are new to market, focus first on building brand presence in wholesale channels, then layer in DTC as you grow.

Logistics and supply chain essentials

A strong distribution plan needs a reliable back end.

• Fulfillment model – from your facility, a co-packer, or bonded warehouse.
• Inventory control – keep it lean but avoid stockouts.
• Compliance at every step – shipping documents, labeling, and recordkeeping must meet regulations.

Technology tools, even simple spreadsheets or inventory apps, can make early operations more manageable.

Staying compliant

Regulatory compliance is not optional. You will need:

• Federal licensing and label approvals from the TTB.
• State-level licenses and product registrations.
• Timely excise tax payments and reporting.
• Marketing that follows both TTB and state trade practice rules.

A compliance calendar and organized digital records will save you headaches and fines.

Marketing your way into more accounts

Once your product is on shelves or menus, the real work begins.

• Build relationships with key on-premise accounts for brand credibility.
• Support off-premise retailers with tastings, shelf talkers, and staff training.
• Use digital marketing to spotlight your brand story and retail partners.
• Track data like account count, reorder frequency, and event ROI to refine your efforts.

Final word

Distribution in the U.S. is complex, but not impossible. Start focused, follow the rules, and support your accounts every step of the way.

The right combination of strategy, compliance, logistics, and marketing will help you get from production to pour with staying power.

Additional resources for beverage brand distribution

If you are building or expanding your alcohol brand, these industry tools and platforms can help with compliance, distribution, sales, and operations.

• LibDib: A licensed wholesale distributor that makes it easier for craft producers to reach retailers and restaurants without traditional distributor barriers.
• Commerce7: An all-in-one DTC platform for wineries and other beverage brands, offering ecommerce, club management, CRM, POS, and fulfillment services.
• Provi: A leading online wholesale marketplace for the alcohol industry, giving brands access to distributor portfolios and helping retailers place orders efficiently.
• Vinoshipper: A compliance and logistics solution that allows wineries, cideries, and craft producers to sell and ship directly to consumers across multiple states.
• ShipCompliant by Sovos: Compliance software that helps brands manage licensing, label registration, reporting, and excise tax filings.
• Oznr: A platform for breweries and craft beverage brands to manage direct sales, pre-orders, memberships, and special releases.
• GetOllie: Brewery management software that streamlines inventory, production planning, sales, and order fulfillment for beverage producers.
• Troly: Winery and brewery management software designed for DTC sales, inventory tracking, order fulfillment, and customer relationship management.
  

FAQ

How does alcohol distribution work in the U.S.?

Alcohol in the U.S. is sold through a three-tier system that separates producers, distributors, and retailers. Each state has its own additional rules.

What is the three-tier system?

It is a legal structure created after Prohibition to prevent monopolies and ensure tax collection. Producers sell to distributors, who sell to retailers, who sell to consumers.

Can alcohol brands ship directly to consumers?

Yes, but rules vary by state and product type. Wine shipping is widely allowed, while spirits and beer face more restrictions.

Do new alcohol brands need a distributor?

In most states, yes. Some allow limited self-distribution for small producers, but a licensed distributor is usually required.

What licenses do you need to sell alcohol in the U.S.?

You need federal licensing from the TTB and state-level licenses in each market. Product labels must also be approved.

How can I make my brand stand out to distributors?

Have a clear brand story, secure initial account commitments, and use professional imagery and marketing materials to make a strong first impression.