Beer Distributors Still Exist In States With Competitive Beer Markets

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One annoying talking point I keep hearing is that liberalizing the alcohol market would put all the beer distributors out of business. It’s just not true.

And I know it’s not true because they still have beer distributors in states where supermarkets and convenience stores and gas stations sell beer.

There will still be a market for beer distributors because grocery stores won’t be able to carry cases of all the brands people want. Grocery stores will carry some cases of the top selling stuff, but people will still need to go to beer distributors to get cases of craft beer and kegs.

Will every current beer distributor survive in a more competitive market? Probably not. Will the market be able to support as many beer distributors as exist today? Maybe not. Will beer distributor businesses be as profitable as they are today? Definitely not.

But the great thing about life in a market economy is that there is absolutely no reason for politicians to care about the answers to those questions.

Businesses go bust all the time. Markets change and some businesses end up making more money, and some end up making less. The role of the political system is to encourage that churn so we’re always getting better businesses and more convenient access to the stuff we want to buy.

This entry was posted in Miscellany.

8 Responses to Beer Distributors Still Exist In States With Competitive Beer Markets

  1. Matt Brouillette says:

    Jon, you’re starting to sound like a free-market, libertarian whack job! :)

  2. Albert Brooks says:

    One of your better ones Jon.

  3. Jon says:

    I can’t take it anymore – any comment citing the zombie $500 million revenue loss talking point is going in the Spam folder. Liberals citing fake numbers are no better than the tea people.

  4. Matt Brouillette says:

    kalamazooway: There a number of inaccuracies in your understanding of what passed the House last week, as well as your understanding of the revenue situation. I’ll address the last first.

    The $500M the state gets from the PLCB is 80% taxes. Those taxes don’t go away under a privatized system. In fact, projections are that they would increase as the private sector responds better to consumer demands and will be able to recapture much of the “border bleed” that is currently sending over $180M in sales to surrounding states. Of course, not all will be recaptured, but we know that the PLCB is not responsive to consumer demands and a private enterprise MUST or risk going out of business. Also, the other 20% of revenues is just higher taxes/fees we consumers pay for government sold alcohol.

    As for the beer distributors and licensing costs, the legislation doesn’t auction off the licenses but sets a price and gives mom-and-pop beer distributors the right of first refusal for a 12-month period and significant advantage. I encourage you to read the actual legislation or read our summary here: