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It’s Just Starting

Read Steve Hindy’s op-ed article in the New York Times (http://tinyurl.com/Hindy-op-ed) and you can tell that the debate about the state of the three-tier system is a long way from being over.  Hindy, the founder and President of Brooklyn Brewery, articulately points out the extreme hurdles that small brewers face in setting up distribution networks as a result of old state laws that ‘continue to empower distributors to select brands and manage them however they want.’

The result, Hindy argues, is a system that doesn’t allow small crafts to manage their own routes to market and blocks them from getting out of distribution contracts that are not performing for them.  It’s a system “[t]hat’s bad for these businesses, bad for the economy, but particularly bad for consumers, who would love to try the latest popular craft beers but can’t find them in their state.”

As the rising legislative debates about Tesla sales in states like New Jersey point out, smaller and innovative brands are revolting against old distribution models.  They need new ways to go to market, new ways to differentiate themselves on the shelves and new ways to counterattack the marketing and distribution heft of big brands.  The debate about how the traditional distribution models should be amended isn’t even close to being over. In fact, it’s just starting.