Download DTC Shipping by Wineries as of March 2014 Adult

THIRD PARTY SALES OF WINE
BY A TEXAS WINERY OR DIRECT
SHIPPER
Sherry Cook, Executive Director
Texas Alcoholic Beverage Commission
512-206-3366
[email protected]
March 11, 2014
1
The Traditional Model of
Sales by Texas Winery
Winery makes wine
or buys it from a
Texas winery,
Texas wholesaler
or nonresident
seller.
Customer orders
wine from winery
(phone, fax, e-mail,
in person, winery’s
website) and pays
winery.
Winery ships
wine to customer.
A winery customer could be the ultimate consumer, a
Texas winery, a Texas wholesaler or a qualified
individual outside of Texas.
An Acceptable Model
This model could involve a Texas winery
or an Out of State Winery Direct Shipper.
Customer orders
wine from winery
via a website run
by unlicensed
independent
third party.
Third
party
sends
order to
winery.
Winery
ships
wine to
customer.
Third
party
sends
payment
to winery.
• The unlicensed third party represents the winery
and the winery provides TABC with their written
contract.
• Each discrete transaction must have a known seller
and buyer when the order is placed.
Winery
sends
third
party a
fee.
3
T HE P ITFALLS
Subterfuge: Winery’s loss of control over the sale,
the inventory, the price, the shipping, etc.
 Unauthorized Activities: Nonresident seller
accepting orders from the ultimate consumer.
 Inter-tier violation: An improper relationship
between entities in different tiers.

4
Comparison of the Authority of Manufacturers
1/1/14 (After 83rd Legislature)
Distillery
Brewer /
Manufacturer
On-Site sales of own product direct to consumer
For on-premise consumption
For off-premise consumption (To Go)
On-Site sales of other products direct to consumer
For on-premise consumption
Yes
Yes
Yes
NO
NO
Yes
Yes
NO
NO
NO
Brew Pub
[Retailer]
Produce <10K b
Winery
Out of State
Winery
Yes
Yes
n/a
Yes
Yes
n/a
Yes
up to 35,000 gallons
n/a
Yes
Yes
n/a
Yes
Yes
n/a
Depends on
For off-premise consumption (To Go)
NO
NO
their permit up to 35,000 gallons
n/a
Ship direct to Texas consumer
NO
NO
NO
up to 35,000 gallons up to 35,000 gallons
Own product
NO
NO
NO
Yes
Yes
Others product
NO
NO
NO
Yes
NO
Sales to Wholesaler/Distributor for Resale
Yes
Yes
Yes
Yes
Yes
Yes if only sell
Yes if production is own product at
Self Distribution / Sales Direct to Texas Retailers
NO
under 75k barrels brewpub; <1K b.
Yes
NO
Distiller's
Beer Agent's
Manufacturer's
Agents
Agent's Permit
License
n/a
Agent's Permit
Agent
Yes, only one
sample of each
Yes, more than one
brand, 1/2 oz,
sample, free or for
Conduct samplings at Licensed Premises
free only
Yes
Yes
fee
Yes
Yes, using a
Yes, using a Beer
Yes, using a
Distiller's Agent
Agent or
Yes, using an Agent
Manufacturer's
or Promotional
Promotional
or Promotional
Agent or Promotion
Conduct samplings at another Retailer's Premises Permit Holder.
Permit Holder.
NO
Permit Holder.
Permit Holder.
Winery Festival
Festival Permit to sell at Farmers Markets, etc.
NO
NO
NO
Permit
NO
Yes only if
Yes with multiple
hosting brewpub
wineries
Festivals to promote the industry at premises
NO
NO
sells all brands.
participating.
n/a
Code is silent
Code is silent
Private Label
but it occurs
NO
n/a
but it occurs
n/a
Alternating Proprietorship
Code is silent
Yes
n/a
Yes
n/a
Code is silent
Contract Brewing/Distilling/Fermenting
Code is silent
Yes
n/a
but it occurs
n/a
5
THE THREE-TIER SYSTEM
BEFORE THE
83RD LEGISLATIVE SESSION
KEY
Manufacturing
Large Brewers
&
Manufacturers
Small Brewers
&
Manufacturers
Distilleries
Brewpubs
Distributing
Wineries
Beer
Distributors
Ale, Wine and
Distilled
Spirits
Wholesalers
Local
Distributors
Retailing
Off-Premise
Beer/Ale/Win
e Stores
Beer/Ale
Wine
Spirits
Package Stores
On-Premise
Restaurants,
Bars, Venues
& Private
Clubs
Brewpubs
Wineries
Shipping
Direct to
Consumers
6
THE THREE-TIER SYSTEM
AFTER THE
83RD LEGISLATIVE SESSION
KEY
Manufacturing
Large
Brewers
&
Manufacturer
s
Distributing
Beer
Distributor
s
Distilleries
Brewpubs
Small
Brewers
&
Manufactur
ers
Brewpubs
who sell
only their
own brew.
Wineries
Ale, Wine and
Distilled
Spirits
Wholesalers
Local
Distributors
Retailing
Off-Premise
Beer/Ale/Win
e Stores
Beer/Ale
Wine
Spirits
Package Stores
On-Premise
Restaurants,
Bars, Venues
& Private
Clubs
Brewpubs
Wineries
Wineries
Shipping
Shipping
Direct
Direct to
to
Consumers
Consumers
7
Distilleries
See Y’all in
Texas
June 16 – 20, 2014