Greenspoon Marder Hospitality, Alcohol & Leisure Blog: Craft Distilleries Search for Alternative Sales Channels During Covid-19

Hospitality, Alcohol & Leisure Blog Aug 5, 2020 Miami, FL

The pandemic has effected producers of alcoholic beverage of all sorts across the county and in the State of Florida. Craft producers in particular have been hard hit including breweries and distilleries.

Certain craft brewers in the state of Florida are, through a beverage law exception to the three-tier system, permitted to hold vendors licenses, operate taprooms and make sales directly to consumers. Craft distillers, on the other hand are not permitted to hold vendor’s licenses but are allowed to sell directly to consumers in face-to-face transactions only from a souvenir shops located on or adjacent to the distillery premises. Certainly many distilleries do derive revenue from the sale of their brands to licensed distributors. Many, however, only manage to keep their stills operating through these face-to-face consumer transactions. As already noted, these types of transactions have come to a screeching halt as fewer and fewer consumers are venturing out during the time of Covid-19 (in this state and across the country).

Craft distillers across the country are calling for direct to consumer sales through direct to consumer home delivery by the distillery or by using common carriers such as FedEx or UPS. Both Virginia and Maryland have relaxed their laws and are permitting their in-state distilleries to ship this way. Some distilleries in these states have reported a significant uptick in sales as a result.

There is opposition to direct to consumer sales coming mostly from the distributor tier of the industry. They argue that the three-tier system is the only way of effectively ensuring that alcohol taxes are collected and remitted and that underage drinking is kept in check. Arguably, distributors and their membership associations will always take a position that protects the integrity of the three-tier system and their role within it.

Florida has yet to relax its laws and permit distilleries to ship to consumers even though certain other producers of alcoholic beverage within this state are permitted to do so. It may be time for Florida to visit this issue as well as loosening the sales restriction on sales at the states craft breweries and wineries too. The entrepreneurs that invested their dollars in these businesses and became viable economic and tourist industry participants for the state are on the verge of closing their doors permanently if creative (albeit temporary) solutions are not found.

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Greenspoon Marder Hospitality, Alcohol & Leisure Blog: Craft Distilleries Search for Alternative Sales Channels During Covid-19

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