Wholesale Beer Buying: A Guide For Beginners

Buying beer wholesale is a great way for businesses to save money and offer their customers a variety of options. Wholesale beer is usually purchased by restaurants, pubs, and bars, as well as hotels, country clubs, and resorts. Buying wholesale means purchasing beer in bulk, directly from breweries or through distributors, at a discounted rate. Distributors are middlemen between breweries and businesses, offering a range of craft beers from local and national breweries. Distributors can also offer other products such as spirits, soda drinks, glassware, and bar equipment. When buying wholesale, it is important to consider factors such as storage, transportation, and profit margins to set the right pricing for the beer products.

How to Buy Beer Wholesale

Buying beer wholesale vs retail

Wholesale

Bars, pubs, and restaurants buy beer wholesale from a local beverage distributor or brewery. Buying wholesale is significantly cheaper than retail, allowing these businesses to lower their costs and increase their profit margins. The wholesale price is typically 70% to 80% lower than the retail price, and bars usually mark up their drinks four to five times more than the cost price.

When buying wholesale, businesses need to consider the type of beer they want to purchase (e.g., domestic, imported, or craft), the quantity they require (e.g., bulk purchases or individual cases), and the format (e.g., bottles, cans, or kegs). Wholesale suppliers often offer additional products such as wine, soft drinks, glassware, and bar equipment.

Retail

Retailers, such as grocery stores, tend to mark up individual units of beer (bottles, cans, six-packs, etc.) to turn a profit, as they often sell single units. The standard industry markup for beer is around 200-300%, and special bottles of brew can go as high as 500%.

For consumers, buying beer at retail prices is convenient for purchasing a variety of different types of beer in smaller quantities. Retailers often offer a range of domestic, imported, and craft beers, allowing consumers to explore different options. Additionally, retailers provide information about beer storage, recommending products like wine and beer coolers to maintain optimal temperatures.

Advantages and Disadvantages

Buying wholesale is advantageous for businesses due to the reduced cost per unit, enabling them to increase their profit margins. However, it may require purchasing larger quantities, which can be challenging for smaller establishments or those with limited storage space. On the other hand, buying retail offers consumers convenience, variety, and the ability to purchase smaller quantities, but it comes with a higher price tag due to the retailer's markup.

Finding beer distributors

Beer distributors are the middlemen between brewers and the stores that sell the final product. Distributors function primarily as a delivery and warehousing mechanism, and in some cases, they also market the beer.

If you are looking to buy beer wholesale, you will need to find a distributor. Distributors are often referred to as a "house", and there are usually two to three major brand houses in any given market, one each for Anheuser-Busch, Miller, and/or Coors. These major brand houses are the largest and most dominant beer distributors. They have excellent contacts within the retail trade, including important chain store buyers. However, the disadvantage for a small craft brewer is that they are a very small player in a large market, and these major distributors will be focused on their primary brands.

There are also miscellaneous brand houses that carry many products other than the big three, such as regional breweries, popular imports, and non-alcoholic beverages. While they do not dominate the market like the major brand houses, they usually have a high level of service and can be a good option for small brewers.

Some markets also have small specialty distributors that specialise in handcrafted, authentic beers, usually imports, as well as domestic craft beer. These small distributors are very enthusiastic and have knowledgeable sales staff, but they may be understaffed and tend to only service the most important accounts.

Another option is to look at liquor and wine distributors, who will usually cover a much broader territory, often statewide, while beer distributors tend to focus on a metropolitan area. Wine and liquor distributors have good product knowledge and will hand-sell the products, but they have very large portfolios, and their main focus is on high-margin wine and spirits.

When choosing a distributor, it is important to consider not only your current needs but also your future needs. It is difficult to terminate a brewery/distributor agreement, so you need to choose wisely. Spend time in the marketplace and talk to retailers to gain insight into which distributors they prefer dealing with. Ask questions about call frequency, draft service, product knowledge, and enthusiasm of the salespeople. Look for a distributor that understands and sells craft beers well.

Once you have narrowed it down to a few options, set up appointments to present your products and discuss pricing and margins. It is also important to consider the "comfort factor" and choose a distributor that you feel comfortable with and can trust.

Contacting breweries directly

If you're looking to buy beer wholesale, you can also try contacting breweries directly. Many breweries have their own apps or websites that allow customers to place orders for beer to be shipped directly to their homes. Some breweries also offer bottle societies or membership clubs that customers can join to access new releases or pre-sales.

Some breweries only sell their beer through third-party retailers, so you may need to do some research to find out if the brewery you're interested in buying from offers wholesale options. You can usually find this information on the brewery's website or by contacting their customer service team.

When contacting breweries directly, it's important to keep in mind that there may be restrictions on how much beer you can order and where it can be shipped. Beer is heavily regulated at the state level, so you'll need to make sure that the brewery you're ordering from is allowed to ship to your state.

In addition, shipping beer can be expensive due to the weight and fragility of the bottles. You can usually expect to pay between $20 and $35 for ground shipping, and you may need to pay more for faster delivery options. Keep in mind that all beer deliveries require the signature of an adult aged 21 or older, so you may want to use a work address for delivery if you won't be home during the day.

By contacting breweries directly, you may be able to get access to limited releases or special offers that aren't available through retailers. This option can be a great way to support small or local breweries and access unique craft beers that aren't widely distributed.

Online wholesale marketplaces

Platforms like BlueCart can help businesses find wholesale beer, compare prices, and find all the products needed for a restaurant or bar. These sites are useful because you can find a variety of distributors and compare their offerings and prices. You can also check out the latest industry trends and find local beer associations.

Another option is to look for an online wholesaler like Sam's Club, which offers beer by the case and pallet, as well as other drinks and party essentials like snacks, plates, and utensils. Drink Warehouse UK is another example of an independent online wholesaler, delivering 7 days a week across South East England. They supply pubs, bars, and restaurants with beer, wine, spirits, and other essentials.

Buying wholesale beer: pros and cons

Pros

Better pricing: Buying wholesale generally means you'll get a better price per unit than if you were buying smaller quantities.

Availability: Distributors work with many breweries and producers, so they can offer a constant supply and a wide range of craft beers.

Variety of products: Distributors tend to work with a large number of top-notch breweries, so you can get products from local brewers as well as beer producers from other parts of the country and the world.

Convenience: Distributors offer a variety of products, not just beer or beverages, so it's convenient for businesses to partner with them.

Cons

Large minimum orders: Distributors usually have minimum order requirements, which may be challenging for small venues and companies with limited storage.

Impact on cash flow: Even though ordering large quantities is cheaper, paying upfront for them can be difficult for some businesses.

Shelf life: Buying wholesale quantities of beer means you need to carefully consider the risk of beer expiration.

Frequently asked questions