Wednesday, January 25, 2017

Navigating Domestic Regulation

I never really thought much of the regulatory environment for alcohol domestically (perhaps because I grew up mostly in CA where there's less limitation and being underage until 4 years ago), but then I moved to Texas and saw the many differences in how alcohol (particularly liquor, but wine and beer too!) was sold state by state. Even more different I've come to experience is in Utah where my boyfriend just moved and liquor stores are state run, closed on Sundays, and very limited in supply. (It's worth noting that not for lack of trying the nicest Chardonnay we've been able to find is La Crema.)

It wasn't until my brother started working for a startup Moonshine company a few years ago and it became really clear to me just how difficult these state-by-state regulations are to navigate for a newly launching company that wants to be sold in stores (groceries, liquor stores etc.) and served in bars. They had to go through a roll out whereby the launched state by state as they could secure the distribution rights-- a process that varied greatly fore each state-- and then had to have extensive boots on the ground to get into the bars they wanted to be served in.

Acknowledging that the market is different for wine (bars vs restaurants for starters), I wonder how difficult it is for a startup wine company to secure the rights they need to "launch" or distribute in different states, and what the process is for getting your wine sold in a given restaurant. If it's anything like the liquor business, it's a lot easier said than done!

1 comment:

  1. I agree with you - and I am equally curious whether there is any additional potential to go with the existing model vs. disrupting the industry. Especially as this structure in the U.S. seems to be more unique in the world. As far as I recall only Indian states had similar alcohol restrictions with states like Gujarat being completely dry. Why in such a interconnected world does crossing a state in the US imply a lot more noticeable changes in regulations than crossing borders in Europe?

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