4 Things to Do Before Setting Up Direct-to-Consumer Shipping

Earlier this week, Brewer shared some information presented by Sovos ShipCompliant’s Senior Regulatory Counsel, Alex Koral, on what states allow Direct-to-Consumer shipping and the sometimes complicated aspects that breweries still have to work through to make sure it is in compliance.

Koral — who spoke at the 2020 Sell More Beer Virtual Summit presented by NBWA — noted that only 12 states allow DtC sales. Once your brewery is up to speed on where it can ship and if it’s legal, then making sure everything is in order is important as well. Fines could pile up quickly if your brewery is audited, more than the costs to get started.

“It’s a costly industry,” he said. “There are a lot of logistics involved with it, not merely managing your compliance needs, but ensuring that you can actually ship there and that you have sales there that would be sufficient for the outlay that would go into shipping to that market.”

Koral shared these four points.

• Recognize Key Markets: “If you have a lot of tourists coming from that region, that’s a great state,” he said as an example. “If you’re already making three-tier distributions into that state, that’s another great market for your DtC market. Because as we’ve seen, those do go hand in glove and you can build one with the other. “
• Be Ready to Sell: “You’ll have to advertise to them,” he said. “Let them know you’re available, and then build out your online presence or some sort of club so that you can get involved with those consumers.”
• Ask For Help: “This can be a very complicated and challenging business,” Koral said. “There’s a lot of logistics involved with it. You have to have your delivery mechanism set up and work with compliance shippers.” Finding help can include your local general counsel, shipping consultants, and even state guilds — both for your state and the states you plan to ship to.
• Automate Compliance: “That can be very burdensome,” he pointed out. “It can be costly if you’re scrambling every month to try and make sure that you’re filing your taxes on time, and your orders are in compliance.”