There is a simple tool in our kit to educate state lawmakers who set the rules and regulations for the Three Tier System: the warehouse tour.

The warehouse may seem commonplace to those of you on the inside, but for visitors, it’s a new world that immediately illustrates the importance of the wholesaler.

When Virginia lawmakers see for themselves the logistics, complexities, the investment you have made, the jobs you’re creating, and the diversity of your portfolio, they understand why the wholesale tier is so valuable.

I share this because we have made warehouse tours a requirement for any candidate to receive support from the VBWA political action committee. The last day of our annual convention last month coincided with Virginia primary elections to determine the candidates who will run in November.

This is a historic election year in Virginia, with unprecedented turnover and partisan control for both chambers up for grabs. We’ve lost around 600 years of institutional knowledge with retirements and redistricting.

Without getting in the weeds, after the primary, I feel good about the outcome of the elections for wholesalers. Time will tell. Still, dozens of new lawmakers will need education on the Three-Tier System, and our focus in the coming months will be teaching them and offering warehouse tours.

We’re keeping our eye on a few issues that could rear up in the 2024 General Assembly, including issues at ABC regarding licensing for non-profit entities, Amazon alcohol advertising, compliance with cocktails-to-go laws, and funding for the Virginia Craft Brewers’ Guild to support limited self-distribution.

A primary focus of ours in 2023 has been the national alcohol marketplace review by the Alcohol and Tobacco Tax and Trade Bureau (TTB).

As a result of the Biden Executive Order on Competition in the Marketplace, the TTB is considering changes to the alcohol regulation with a review of U.S. trade practices. Their focus will include exclusive outlets and tied houses. The VBWA and our ABC counsel, Kevin McNally, spent much of the spring writing comments that were sent to the TTB. These comments align with our state peers and the national association and a copy was emailed to VBWA members at the beginning of July (view and download them here).

There are also two pieces of litigation on our radar.

  • While VBWA has no legal standing to get involved, we’re watching a Virginia ABC case where two wholesalers have filed a complaint to over Boston Beer Co. assigning distribution for Hard MTN DEW to PepsiCo’s Blue Cloud Distribution. Those wholesalers have existing contracts with Boston Beer and say the company violates state law under dual-distribution rules. Pepsi has had significant setbacks in other states, so we are curious how this will play out under Virginia regulations.
  • Another case with ABC, Commonwealth v. Vinoshipper.com, is considering whether the online company helping out-of-state, unlicensed wineries ship directly to Virginia consumers violates state law.

I also want to congratulate the VBWA Board of Directors’ unanimous approval of P.A. Short Distributing’s Aden Short of Roanoke as our new Chair and Virginia Eagle Distributing’s Scott Heinz of Verona as Vice-Chair for the 2023-2024 term. And we thank PH McLaughlin, President of Premium Distributors of Virginia in Chantilly, for his time as chair.

Finally, I’d be remiss not to say something about the issues surrounding our members distributing Bud Light. This was, of course, a big topic of discussion among peers at our annual convention, and it gave me much pride to witness the overwhelming, full support given by competitors to their Anheuser-Busch peers whose businesses have been sideswiped by a media-fueled spectacle.

It’s living proof that our distributors, whether colleagues or friendly rivals, understand that we are stronger together.

Philip H. Boykin
President & CEO
Virginia Beer Wholesalers Association

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