Beer Distributors Step Into the Spotlight
Sector outlines economic impact, calls for caution on CT liquor changes
Connecticut is once again facing a fight over the beer and liquor industry. After the introduction of Sunday sales, this year the focus will be on alcohol pricing. WNPR’s Harriet Jones reports on a lesser known tier of the industry -- the distributors.
At a massive warehouse in West Haven, a forklift shifts several cases of beer to be loaded for a delivery. This is the premises of Star Distributors, one of ten liquor and beer distributing businesses in the state.
“We kind of fly under the radar, you know? Some of the bigger breweries might get the recognition, or some of the package stores might. But we’re really behind the scenes on everything.”
Peter Gallo is the third generation in this business - his grandfather started with a single truck in Litchfield County as A Gallo and Sons. That family company bought out Star several years ago, part of a trend of consolidation in the distribution tier. Distributors sit between the brewers and liquor manufacturers and the package stores, the point of sale.
“It’s a drug. I mean, alcohol has to go through the right channels, you have to have the right licenses, the right age to buy it. It can’t be like bread or milk where you sell it and it’s whatever the cheapest price is.”
The National Beer Wholesalers Association has been shining a light recently on this part of the industry, sponsoring a study that shows distributors generate more than 500 million dollars in economic impacts in Connecticut, as well as 120 million dollars in state and local taxes.
“In the state of Connecticut the middle tier, the distributors, represent over a thousand jobs. Well paying jobs, health insurance, 401ks, and a lot of long term employees. A lot of our employees have been with our companies for 20, 30, 40 years.”
But its an industry that’s facing major change. Sunday sales last year brought the package store owners to the capitol. This year, the Governor once again wants to shake things up, focusing on allowing discounted and volume pricing.
“It affords a lot of opportunities to a lot of the bigger box stores, which would really change the dynamic of the business that we’re all in. You wouldn’t have your local mom and pop store, you’d just go to a big store where there’s four items and that’s your selection for the day. So, the system we have here in Connecticut is different from other systems, but it’s worked for us since prohibition and should continue to work.”
Distributors fear a breakdown of the traditional relationships that have characterized the industry for almost a century. And lawmakers too reflect the fractured opinions on the issue. A taskforce commissioned last year by the Governor to study the industry failed to come up with concrete recommendations on reform.