Always have distribution w/ Cheryl Durzy, LibDib

Having struggled to manage and maintain distribution for her family winery, Cheryl Durzy, CEO of LibDib, 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.  Detailed Show Notes:  US 3-Tier SystemPut in after prohibition to keep one tier from owning alcohol distributionTiers - producer, distributor, retailer US distribution heavily consolidated into 3 large ones, lots of smaller specialty distributors vs. many distributors in the 70s/80s Distributor functionHelps consolidate suppliers for trade accounts; accounts don’t have resources to manage each supplier separately (e.g., invoices, checks)Pay taxes, do complianceLogistics (heavy, fragile product)Customer service (mistakes, breakage, returns, samples)Sometimes act as a winery’s salesforce Getting a distributor2024 - distributors are shedding brands vs. taking on new onesTypically - look for fit w/in a distributor’s portfolio, pick someone with a good reputationDistributors will ask - what will be your investment in the market? How often will you be here? Do you have feet on the street? LibDib - enables wineries to sell themselves, a tech-enabled distributorStarted as a wholesaler in 2017 (CA, NY), enables distributor for any producerThe platform enables rich content and e-commerceHas license in 9 states, enabled through RNDC in 6 states (e.g., Texas)~1,500 suppliers w/ active accounts, ~700 wineries w/ ~450 actively sellingOriginally focused on spirits, wineries have increased by ~50% in the last few yearsUses FedEx to send wine, integrated API to track status, negotiated good rates New markets launching late 2024 / early 2025 LibDib use casesGet wine to specific accounts in a marketEnable wine brokers in other statesImporters sell directly to accountsShip special projects from large wineries that distributors don’t want to touch Pros/cons of LibDibPro - always have distribution, good communications/customer service, good technology experience for producers and trade accountsCons - no salesforce, need to be a little tech-savvy Business modelMarkup of 14-18% on sales (vs. 30-35% for most distributors) + producer pays for shippingSubscription service (Gold, Silver, Plus) - get lower markups and services (e.g., portfolio management, VIP chain assistance, advertising on platform)~250 subscriptions (of 1,500), mainly on Gold for chain services RNDC partnership - OnDemand divisionOnboard w/ both RNDC and LibDib, no sales support28% markup, inclusive of shipping6 states, ~400 suppliersMost people want to get regular distribution, which can act as a trial for RNDC Trade account benefits~30k accounts (~50% active), not including RNDC statesNo minimum shipmentsEnables direct contact w/ wineriesAccess to smaller items not available elsewhere LibTech (launched Jan 2024 in TN)RNDC invested in the last round, and LibDib built e-RNDCSelling e-commerce platform as SaaS to other distributors LibDib is developing AI tools for suppliers, early 2025 launch Get access to library episodes Hosted on Acast. See acast.com/privacy for more information.