Delivering Back to The State and Local Communities

The Benefits of the Three-Tier System

The three tier system offers a variety of regulatory, economic, commercial and consumer benefits.  Learn more about these benefits below.

Regulatory Benefits of the Three-Tier System:

  • Distributors:
    • Provide accountability by tracking product from manufacturer to retail, allowing the chain of custody to be transparent and traceable
    • Safeguard product to ensure its integrity by ensuring sales are made to licensed retailers
    • Ensure state and local tax collection is straightforward and easy to track through a clear chain of custody

Economic Benefits of the Three-Tier System:

  • Distributors:
    • Are headquartered in small towns and are not corporations based in another state or country
    • Employ local men and women, infusing local communities with solid wage earning, benefit and retirement providing employment
    • Are responsible corporate citizens, paying their fair share of income and property taxes
    • Contribute to local charities and philanthropic projects, supporting local needs

Commercial Benefits of the Three-Tier System:

  • Distributors:
    • Create healthy competition in the marketplace by providing product choice via a vast assortment of beer brands
    • Build brands and help craft brewers expand through merchandising, product promotion, marketing plans and local festival and event sponsorship
    • Ensure only safe and fresh products are available

Consumer Benefits of the Three-Tier System:

  • Distributors:
    • Manage quality and rotate product as needed to provide the public with the freshest and best available selection
    • Ensure a multitude of product choice is available to be brought to market at low cost, due to efficient infrastructure
    • Are local and know their local market needs. They sponsor responsible consumption programs and seminars to prevent underage drinking in their communities.

For more information regarding the three-tier system and its origins please review Toward Liquor Control by Raymond B. Fosdick.

The book is a wonderful overview that explains why Prohibition failed, the dangers of bootleggers and lack of respect for the law, why alcohol manufacturers should not own retailers, alcohol taxation, why lower alcohol products like beer and wine should be regulated differently than hard liquor and many other subjects pertaining to alcohol regulation.