BusinessHABLiquor distributors: If you’re looking to grow your business and expand into new territory, investing in a liquor distributor might be the perfect solution.
Liquor distributors sell alcohol directly to businesses (rather than consumers), which means they can help small breweries and wineries expand their reach without having to open up new stores themselves.
A good distributor will also take care of all the logistical aspects of getting your product to retailers so that you can focus on what you do best — making awesome beer!
With hundreds of independent breweries popping up across the country every year, there has never been a better time to invest in a liquor distributor.
Read on for five reasons why you should invest in a liquor distributor now.
5 Reasons Why You Should Invest in a Liquor Distributor
We all know how hard it can be to break into the alcohol industry. Distribution is limited and there are a lot of regulations in place that make it tough for new businesses to get started. But this doesn’t mean you should stay away from the liquor industry altogether. In fact, now is the perfect time to get in if you have some capital at your disposal and a high risk tolerance. Let’s take a look at why now is such an ideal time to invest in a liquor distributor.
The market is hot right now.
The demand for alcohol has been steadily growing due to increased spending by consumers. Consumers are spending more on alcohol because they feel more financially secure. A reduction in unemployment, higher wages, and an overall increase in wealth has created a society that is more willing to spend their money on experiences and luxuries – including alcohol. This has been great for the spirits market, which has seen a large increase in demand, as well as the wine and beer markets. This increase in demand, coupled with a limited number of suppliers, has created an ideal situation for potential liquor distributors. Increased demand coupled with limited supply creates higher profit margins and opportunities for distributors. That’s why now is the best time to get into the market.
You won’t face as much competition.
One of the biggest barriers to entry in the liquor industry is the limited number of distributors. There are only so many distributors in each state – and they get first dibs on new brands and products. This means that when a new product comes out and is looking for a distributor, they’re going to go with an established company with a proven track record of sales. This means that new companies have a hard time getting their foot in the door. But the good news is that there are less distributors out there now. A lot of new companies have gone out of business in recent years. Distributors have had to close their doors due to big players like Amazon and Walmart selling alcohol on their websites. This has forced a lot of smaller distributors out of the game.
You’ll be well-positioned for when the market cools off again.
One of the biggest risks of investing in a liquor distributor is that the market could cool down. Could new laws hinder sales, and could companies start to lose money and close their doors? Absolutely. But that doesn’t mean that the risk isn’t worth it. You’ve probably heard the phrase “buy low, sell high.” That couldn’t be more accurate when applied to the liquor industry. The market is currently hot, so you’ll be able to get great deals on products at auction. You’ll be able to get products for cheap as liquor companies need to liquidate their stock for cash. When the market cools off, you’ll be able to sell the products you bought at auction for a much higher price. In the event of a total market crash, you’ll be able to hold onto your products for a long time – even if you’re stuck with them for a while.
Consumers are highly brand-conscious, and shelf placement is crucial.
You may be wondering how shelf placement even becomes an issue. There are plenty of ways to get in front of consumers – including influencers, marketing campaigns, and more. So why is shelf placement so crucial? A large portion of consumers want to know where they can find the products they want. They want to know which aisle to walk down, which shelf to scan. This is especially true for spirits – consumers want to know where their favourite products can be found. With multiple retailers selling alcohol, shelf placement becomes crucial. Consumers are highly brand-conscious. If a consumer sees a product in the wrong place, it’s going to have a negative impact on their brand loyalty and overall sales.
Technology is making a huge impact on the industry.
Retailers are increasingly investing in tech solutions that will help optimize their shelves, track inventory, and increase sales. Those retailers that invest in these technologies are able to accommodate the consumer demand for brand-specific shelf placement. It’s easy for consumers to see which brands are in the store and see where they can be found. It’s also easy for retailers to track product movement, optimize their inventory, and make sure that consumers aren’t shorted on product. This helps ensure that consumers can easily find the products they’re looking for. These technologies are making it easier for retailers to stock shelves and make sure that they’re making the most of every inch. It also makes it easier for distributors to get products in the hands of consumers.
Jobs are growing fast – there’s a lot of potential here.
If you’re worried that there won’t be a lot of jobs in the alcohol industry, you can rest assured. There are a lot of jobs in the alcohol industry, and there will continue to be for the foreseeable future. A liquor distributor is going to have to hire staff to drive to auctions, pick up products, and make sure they’re getting to the store in an efficient and timely manner. Those distributors that are able to scale their businesses and hire more employees will have an advantage. That’s because distributors who can scale and hire more employees will be able to offer drop shipping options to retailers. This will help those retailers hire and maintain a strong staff without having to worry about inventory.
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