{"version":"1.0","type":"rich","provider_name":"Acast","provider_url":"https://acast.com","height":250,"width":700,"html":"<iframe src=\"https://embed.acast.com/$/62301a5c63c97500122f8a76/67350123f3e24296854110aa?\" frameBorder=\"0\" width=\"700\" height=\"250\"></iframe>","title":"Always have distribution w/ Cheryl Durzy, LibDib","description":"<p>Having struggled to manage and maintain distribution for her family winery, Cheryl Durzy, CEO of&nbsp;<a href=\"https://libdib.com/#\" target=\"_blank\">LibDib,</a>&nbsp;decided to start her own distributor. In comes LibDib, a tech-enabled distributor that lets any alcohol producer have distribution in most of the key US markets. Cheryl provides background on the US 3-tier system, the role of a distributor, and how LibDib is helping producers get distribution, enable wine sales, and become a tech platform for other distributors.&nbsp;</p><p><br></p><p><strong>Detailed Show Notes:&nbsp;</strong></p><p>US 3-Tier System</p><ul><li>Put in after prohibition to keep one tier from owning alcohol distribution</li><li>Tiers - producer, distributor, retailer</li></ul><p>US distribution heavily consolidated into 3 large ones, lots of smaller specialty distributors vs. many distributors in the 70s/80s</p><p>Distributor function</p><ul><li>Helps consolidate suppliers for trade accounts; accounts don’t have resources to manage each supplier separately (e.g., invoices, checks)</li><li>Pay taxes, do compliance</li><li>Logistics (heavy, fragile product)</li><li>Customer service (mistakes, breakage, returns, samples)</li><li>Sometimes act as a winery’s salesforce</li></ul><p>Getting a distributor</p><ul><li>2024 - distributors are shedding brands vs. taking on new ones</li><li>Typically - look for fit w/in a distributor’s portfolio, pick someone with a good reputation</li><li>Distributors will ask - what will be your investment in the market? How often will you be here? Do you have feet on the street?</li></ul><p>LibDib - enables wineries to sell themselves, a tech-enabled distributor</p><ul><li>Started as a wholesaler in 2017 (CA, NY), enables distributor for any producer</li><li>The platform enables rich content and e-commerce</li><li>Has license in 9 states, enabled through RNDC in 6 states (e.g., Texas)</li><li>~1,500 suppliers w/ active accounts, ~700 wineries w/ ~450 actively selling</li><li>Originally focused on spirits, wineries have increased by ~50% in the last few years</li><li>Uses FedEx to send wine, integrated API to track status, negotiated good rates &lt;50% of DTC rates; have cold chain, ice pack options for hot temperatures</li><li>New markets launching late 2024 / early 2025</li></ul><p>LibDib use cases</p><ul><li>Get wine to specific accounts in a market</li><li>Enable wine brokers in other states</li><li>Importers sell directly to accounts</li><li>Ship special projects from large wineries that distributors don’t want to touch</li></ul><p>Pros/cons of LibDib</p><ul><li>Pro - always have distribution, good communications/customer service, good technology experience for producers and trade accounts</li><li>Cons - no salesforce, need to be a little tech-savvy</li></ul><p>Business model</p><ul><li>Markup of 14-18% on sales (vs. 30-35% for most distributors) + producer pays for shipping</li><li>Subscription service (Gold, Silver, Plus) - get lower markups and services (e.g., portfolio management, VIP chain assistance, advertising on platform)</li><li>~250 subscriptions (of 1,500), mainly on Gold for chain services</li></ul><p>RNDC partnership - OnDemand division</p><ul><li>Onboard w/ both RNDC and LibDib, no sales support</li><li>28% markup, inclusive of shipping</li><li>6 states, ~400 suppliers</li><li>Most people want to get regular distribution, which can act as a trial for RNDC</li></ul><p>Trade account benefits</p><ul><li>~30k accounts (~50% active), not including RNDC states</li><li>No minimum shipments</li><li>Enables direct contact w/ wineries</li><li>Access to smaller items not available elsewhere</li></ul><p>LibTech (launched Jan 2024 in TN)</p><ul><li>RNDC invested in the last round, and LibDib built e-RNDC</li><li>Selling e-commerce platform as SaaS to other distributors</li></ul><p>LibDib is developing AI tools for suppliers, early 2025 launch</p>","author_name":"Robert Vernick, Peter Yeung"}