Florida’s Three-Tier System Works for Retailers

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Many home-brewers have a shared dream of abandoning their 9-to-5s to pursue the craft beer business full time, but few of these visions come to fruition. Florida’s three-tier system provided the structure and support Bold City Brewing Company needed to turn their passion into profit.

When Susan Miller and son Brian Miller left their steady jobs at a major corporation to open a brewery in 2008, the future was unclear. With everything at stake, the Millers poured their passion and labor into the creation of Bold City Brewing Company, a brand that captures the vibrant personality of their family and community.

Charming anecdotes, their hometown of Jacksonville, and a beloved pet boxer inspired Bold City’s flagship beers, all of which are available in cans. “Duke was my dog. I loved him to death, and he got sick,” brewmaster Brian Miller told us during a recent visit to the brewery. “I wanted to brew him a beer before he died.” Thus, Duke’s Cold Nose Brown Ale was born.

According to Susan Miller, another favorite, the Killer Whale Cream Ale derives its name from a family vacation, when young Brian Miller stood debating whether to jump from the top of a waterfall into the pond below. “Do it, Killer Whale!” shouted a bystander. The nickname stuck. Susan said, pointing out a detail in the can design, “Because it’s a mother-son business, we have a ‘MOM’ tattoo on the whale’s fin.”

It’s easy to see how Bold City became a Florida favorite, but behind the delightful stories and delicious ales, there’s another crucial facet that the Millers attribute to their success – their utilization of the three-tier system to efficiently and widely supply bars, restaurants, and retailers with their product.

Florida law requires the “three-tier” system for beer distribution. Breweries create the product (Tier 1), distributors pick up the beer, support the brewers’ brands and then, of course, deliver by the truckload (Tier 2), to bars and retailers across the state (Tier 3). This system makes Bold City’s beer accessible to craft aficionados near and far.

“When we started developing our business plan, part of what we had to do was figure out how we were going to distribute our beer,” Susan explained. “We looked at all the requirements and decided, ‘Well we could do this,’ so we formed our own distribution company.”

Through a great deal of effort, they managed to form relationships with around 40 retailers within the first year. However, the responsibility of running separate businesses in two of the three tiers demanded much of the time they had previously spent experimenting with the beer itself. “We found out doing that part of the business distracted from what we were really about, which was the brewing and the packaging.” Susan said.

Self-distribution also proved to be more costly than they had expected. “You have to have the trucks, the liability insurance, the staff to clean the lines, the salesmen,” Susan said. “There’s a lot that goes into it. At a certain point we decided we needed to look for a larger distributor.”

After interviewing several independent distributors in the Jacksonville area, the Millers chose to partner with North Florida Sales, who distributes beers from AB-Inbev, Constellation Brands, Inc. and Sweetwater Brewing Company, as well as many other import, regional, and local brewers. Their distribution territory is also one of the largest, covering twelve Florida counties in the northeast region of the state. “When we met them, we had an almost automatic bond.” Susan said. “They’re a family business, we’re a family business.”

“It really was a handshake deal, and you just don’t find that very often these days. Working with them has been a wonderful experience.” Susan said.

“We move a lot of beer through North Florida Sales,” Brian said. “They have the relationships with the retail outlets to ensure we get good product placement, that our taps stay on, that the lines are clean and the customers are happy.”

The distributor also helps promote Bold City’s brand, solve any problems with retailers, and support the growth of the business. “It really is a partnership,” Susan said.

“I consider these guys my friends,” Brian added. “I feel like if there was ever a time in need, I could call on them and they would be there. Not only because they sell my product and we do business together on a daily basis, but I just think there’s a respect there now; of what we do, and of what they do.”

Florida’s three-tier system allows breweries like Bold City to specialize in their craft, with freedom to experiment and run their business as they see fit. And, what sets Bold City apart is the value placed on each individual, their personal stories, and the simple love of a great, cold beer. It takes tremendous group effort to flourish in the beer business and these companies are doing just that.