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  1. #1
    Enthusiast
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    Is there a good reason for distributors to exist?

    This may be a little too meta, but one of the posts in the "Why?" thread got me thinking.

    Is there a good reason for distributors to exist? I guess I can understand a bit that they served as a taxation "choke" point as there were a lot of producers and a lot of retailers, but with the way business is done today do they serve any purpose other than a middle man?

    Do you think there would be any differences in the bourbon being produced if distillers could work directly with retailers, and perhaps directly with consumers?

    Note: I realize being in Georgia I have basically nothing to complain about than some of you guys in controlled states, and other places with crappy distributors. But curiosity got the better of me

  2. #2
    Taster
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    Re: Is there a good reason for distributors to exist?

    Is there a reason for distributors to exist? 1000% YES. Working for a retailer, it would be a nightmare for us to deal with each and every producer, week in and week out. If I had to call the distillery every time I wanted to order a case of Wild Turkey or Eagle Rare, it wouldn't be worth it. We'd carry fewer brands, simply to minimize the hassle. Our store actually orders some products directly from local wineries (NYS allows this) and it takes more manpower for us (and the wineries) to work this way. Most NY wineries do not self-distribute because it's far easier to leave deliveries to one entity rather than drive all over the state for a few cases here and there.

  3. #3
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    Re: Is there a good reason for distributors to exist?

    Quote Originally Posted by TheOakMonster View Post
    Is there a reason for distributors to exist? 1000% YES. Working for a retailer, it would be a nightmare for us to deal with each and every producer, week in and week out. If I had to call the distillery every time I wanted to order a case of Wild Turkey or Eagle Rare, it wouldn't be worth it. We'd carry fewer brands, simply to minimize the hassle. Our store actually orders some products directly from local wineries (NYS allows this) and it takes more manpower for us (and the wineries) to work this way. Most NY wineries do not self-distribute because it's far easier to leave deliveries to one entity rather than drive all over the state for a few cases here and there.
    Ny for you. Cmon its helping retailers? How about us enthusiasts and supporters. Glad we can make it easier on you to provide what is easiest for you to make one phone call per day. Yeah everything isnt clicks on the internet noawadays. Thanks for confirming the power structure in controlled states.

  4. #4

    Re: Is there a good reason for distributors to exist?

    Those distilleries would need a rickhouse full of telephone order takers if every retailer phoned in each order.

  5. #5
    Guru
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    Dec 2012
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    Houston
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    Re: Is there a good reason for distributors to exist?

    Sort of like shopping for groceries without a grocery store.
    I've never tried GTS with any sort of soda. Maybe I'm missing out; but I'm OK with that.

  6. #6
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    Re: Is there a good reason for distributors to exist?

    Quote Originally Posted by jmj_203 View Post
    Ny for you. Cmon its helping retailers? How about us enthusiasts and supporters. Glad we can make it easier on you to provide what is easiest for you to make one phone call per day. Yeah everything isnt clicks on the internet noawadays. Thanks for confirming the power structure in controlled states.
    Reality is, our store would carry far fewer products and producers without the efficiency of distributors. We wouldn't even bother carrying KBD products or similar small producers because we couldn't meet minimum order requirements from a direct supplier.

  7. #7
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    Re: Is there a good reason for distributors to exist?

    I see no good reason why there couldn't be a dual system where distributors continued to offer their services but the distilleries were also allowed to make direct sales if they wished.
    We're Bourbon Geeks, it's who we are, it's what we do.

  8. #8
    Virtuoso
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    Nov 2011
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    Lexington, KY
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    Re: Is there a good reason for distributors to exist?

    I really like the smaller distributors. They tend to have knowledgeable sales reps that know their products, etc.

    On the other hand I really can't say much positive about the big distributors... one of them in particular.

  9. #9
    Taster
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    Nov 2012
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    Re: Is there a good reason for distributors to exist?

    Quote Originally Posted by squire View Post
    I see no good reason why there couldn't be a dual system where distributors continued to offer their services but the distilleries were also allowed to make direct sales if they wished.
    Agreed. If the requirement to use distributors was removed, your large producers (say, Sazerac, Pernod, Campari, Suntory/Beam) might establish warehouses, staff, trucking, and salesmen in each state and abandon their distributors while smaller producers continue to rely on distributors. But, what's the real benefit? I doubt, Pappy Van Winkle or AAA10 will be more readily available nationwide. Yes, distributors decide, in part, what products to carry from a producer, but the producer also chooses to not make all products available in all markets. Will prices decrease? That's no clear, since the producers are now required to invest money to fulfill functions distributors once covered.

  10. #10
    Virtuoso
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    Apr 2011
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    Re: Is there a good reason for distributors to exist?

    Taxation and uneven distribution issues aside, from the producer's standpoint, I'd think the distributor offers the obvious benefit of more predictable revenue and working capital management - being able to move your inventory on some regular and more or less predictable schedule brings efficiencies to those operations.
    Mark

 

 

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