FAQ Exports
Why should I do exports? Exports are a great way to start building an international presence for your brand and to start diversifying your revenue streams from just domestic sales. Should your domestic channels be interrupted, it’s always a good idea to have other channels to sell to. Also, for some top craft producers, your products are already being sent overseas via grey market channels where quality control is not being maintained. There are organized grey market sellers who are sending pallet loads to export markets already and doing formal exports is a way to help abate this. In many instances, exporting is easier than finding a distributor in some U.S. states.
What do I need to do for exports? Some basics requirements:
1. Need to use heat treated pallets. The heat treatment kills any bugs/insects so you do not bring an invasive species from one country to another. Heat treated pallets have a mark or stamp on them similar to the below:
2. Do a Certificate of Analysis (COA) with packed on date, list of ingredients from most to least with percentages, ABV%, & original degree plato listed and usually this can be done by the producer. There are a few countries that do require 3rd party analysis to do the COA.
3. Other countries require additional export documents like a basic description of your manufacturing process and notarization by the TTB or your Chamber of Commerce for a certificate of origin. Some also require an authorization for exports from the brewery and a statement of the brewery’s annual production as they have sliding scales for excise tax rates.
4. Your ABV must be within a certain deviation range which is usually +/- 0.5% of stated ABV in order to pass any testing.
5. A basic agreement with your export/import partner.
Do I need to change my labels for exports? In general no, as my import partners will do any label changes in-country. However, in countries that have a state controlled retail monopoly like in some Canadian provinces, Finland, Norway, & Sweden and you want to have your product sold thru the retail monopoly, you will need a fully compliant label. Re-labeling the quantities needed to be sold in these retail monopolies will not make sense to be done by hand and thus proper printed labels will be needed. Also, if you want to sell thru the large mass retail grocery channels, then similarly you will need to have a fully compliant label. Quantities to be in these types of mass channels of course would warrant having a customized and compliant export label.
What about cold chain logistics for temperature sensitive products? Yes, I & my import partners can maintain cold-chain where required with refrigerated ocean container shipping or faster air shipping where economically feasible to keep hoppy beers at 34°-38°F / 1°-3°C or sensitive wines at 50°-60°F / 10°-16°C.
How can AmeriCraftBier help me with exports? AmeriCraftBier has an extensive global network of vetted import partners in Australia/Asia, Canada, & Europe. We take the hassle out of exports where we handle the transport from your warehouse, arrange for air or ocean shipping, customs clearance, in-country label compliance, distribution, and sales/marketing of your brand. We just need ex-warehouse export pricing (you can take out TTB & state alcohol excise taxes), some logistics information like how many cases fit on a 48” x 40” heat treated pallet, individual case dimensions and weight, information on the product like packed on date, list of ingredients, ABV%, and original degree Plato.
Importing to the U.S.
Unfortunately, importing an alcoholic beverage into the U.S. is a complicated process with many rules at the Federal and State level. The below is a basic overview of the process needed to import an alcoholic beverage to the U.S.
First stage for importing to the U.S. is to work and sign an agreement with a permitted U.S. importer. This importer will work with you to get your brand labels approved at the Federal level with The Alcohol and Tobacco Tax and Trade Bureau (also known as the TTB) for your Certificate of Label Approval (COLA). There are various warning statements, volume & ABV formats, importer & suppler information needed based on if you are submitting for beer, cider, mead, wine, or spirit. Typically, the approval process will take about 3-4 weeks from when the COLA application is submitted and if there are no changes requested by TTB.
Once your label has been approved by the TTB, you next need to get your labels approved at the state level. Each state has their own procedure for approving your “brand registration”, but usually involves submitting your approved COLA, a picture or electronic file of your label, fill in the state application, and pay a fee. State approval time varies from state to state, but will be about 3-5 weeks from when they receive your application.
Then distribution of the alcoholic beverage must adhere to the Three Tier System (TTS). The three tiers are:
- Producer or Importer if a non U.S. company
- Distributor
- End Seller Trade Accounts who actually sells to the consumer. In the U.S. we divide the end seller into On Premise (bar, restaurant, café where you drink the beverage on site, in other countries this is call On Trade or On License ) and Off Premise ( bottle shop, grocery store, online shop where you buy the beverage to drink off site like in your own home, in other countries this is called Off Trade or Off License)
These three tiers need to be separated and simplistically, the TTS prevents the vertical integration of the various tiers which can cause an unfair competitive advantage. For example, it is not legal for the Producer like a brewery or winery to also own 200 of their own bars/restaurants/bottle shops. This is a very simplistic description of the TTS as there can be exceptions to these TTS rules at the state level. For example, alcohol Producers in many states are allowed to sell directly to consumers from their own brewery/distillery/winery and in some instances are also allowed to self-distribute their own products to trade accounts within their state.
So what does this mean for importing your alcoholic beverage into the U.S.? First, you will need to find an U.S. importer who will bring your products into the U.S. to do the TTB brand COLAs, pay the TTB alcohol excise taxes, register your company with the U.S. Food & Drug Administration (FDA), and then resell your products to trade accounts and to distributors in other states. For example, if your importer is based in New York, they will need to sell to distributors in the other states like in California, Florida, Illinois, Texas etc.., unless they also have distribution permits in these states too. Your New York distributor/import in general can NOT sell directly to a trade account in another state.
This is a basic overview, but if you are interested in importing to the U.S., please contact us.
FAQ Direct to Consumer (DTC) eCommerce sales platform
I thought it’s illegal to ship alcohol across state lines? Currently 45 states & DC allow out of state wineries to ship into their state, about nine states (with some reciprocity conditions) & DC allow a brewery, and only four states & DC allow a distillery to ship. However, laws are constantly changing and more states are allowing out of state breweries, cideries, distilleries, meaderies, and wineries to ship directly to a consumer.
There are various rules you need to know and comply with like quantity ship limits per month, not shipping to dry Zip Codes, remitting of alcohol excise & retail sales tax, brand registrations, price postins and so on. The rules are very complicated and way beyond a complete answer in this FAQ, so reach out to us if you are interested in shipping your brands across state lines.
The U.S. Alcohol and Tobacco Tax and Trade Bureau’s (TTB) stance is that each state will regulate interstate alcohol shipping. The pivotal Granholm v. Heald, U.S. Supreme Court (May 16, 2005 decision) declared unconstitutional State laws that prohibited direct shipment of wine to consumers within the state from out-of-state businesses, but permitted direct shipment to those consumers from in-state businesses. Thus, there have been challenges and changes in states reexamining their direct to consumer shipping laws. See link to TTB’s stance https://www.ttb.gov/publications/direct-shipping
Why do DTC sales when I already have distribution in other states working with a distributor and in on and off premise accounts already? Many consumer packaged goods (CPG) companies are realizing, the way we sell to consumers is changing and DTC channels are one of the fastest growing channels that brands large and small are taking advantage of. Consumer buying habits and trends are changing where the convenience and time savings of having something shipped direct to you is becoming commonplace and in certain markets and demographics, the preferred method for shopping many household items like food, diapers, pet supplies, luggage, mattresses, meal kits, electronic goods, toiletries etc… There is no reason that alcoholic beverage buying habits similarly will not follow this trend especially with the Millennial and Generation Z demographic who are digital natives and live, communicate and more often than not purchase via mobile or online 24/7.
Think of DTC as “infinite shelf space” as there are numerous challenges for a brand to gain placement or be easily seen by consumers in off premise accounts, especially the large chains. To show you how big alcohol DTC is and what its full potential in the U.S., Americans bought about $3.2 Billion dollars worth of wine via DTC channels in 2019 or about 11% of all wine retail sales. Imagine how much larger alcohol DTC would be with beer and spirit sales which at this point are relatively small in comparison.
DTC allows a producer to be in control of their own sales and not dependent on the other distribution tiers which the COVID 19 crisis showed were extremely fragile and broke down in days once states implemented “stay in place” and on premise closures or restrictions. DTC would still allow producers channels to sell their products during a similar crisis and not be totally reliant on traditional channels. In addition to more control, DTC provides much better margins and direct engagement with their consumers versus traditional 3 Tier Distribution.
Do I need permits to do DTC shipping? Yes, in most states the producer(brewery, distillery, winery etc…) will need to apply for a state’s “direct shipper permit”. In many states the producer will also need have an alcohol bond in that state and will need to apply for a state tax registration number for remitting the alcohol excise & retail taxes. Fees and application times vary from state to state. Also, you should check with your own state regarding direct to consumer shipping out of your state. We can advise you on the permitting process.
How does your eCommerce platform work? Our Direct to Consumer (DTC) platform is a simple “turn key” solution for an alcohol producer to use to allow them to sell to out of state consumers in the states where it is legal. What makes our site unique is that it automates and handles the confusing and byzantine state compliance administration for doing online DTC sales. It works like any other eCommerce platform where we take orders, do the credit card processing, and shipper integration/ label generation. What is unique is that it automates the alcohol compliance portion so at the end of each state’s filing period, you can easily pull your sales records to each state as it calculates for you how much is owed for excise/retail taxes, the various filing requirements in each state, and each transaction to that state. The platform will also make sure you do not ship to “dry Zip Codes” and keep track of quantity ship limits to consumers.
We will create a sub-web page on our site which will have your products listed and where a consumer can purchase your products. You can easily create a link for a consumer to click that will automatically take them from your website to your specific shopping page on our site. The consumer will browse, place products into their shopping cart, and finalize the sales transaction like any other eCommerce site with credit card processing and ship label generation.
Once an order is received, we will send you the pick list/invoice to fulfill the order and the UPS shipping label. Once you have packed the products securely in the shipping box, just put the UPS ship label on the box and request a UPS pickup if you don’t already get daily pickup or drop off at any authorized UPS drop off location.
You and the customer will be given tracking information.
We get a percentage of the sale and a nominal fee per month for website maintenance, incorporate any changes to state alcohol excise or retail sales taxes, keep up to date on new state alcohol regulations that effect DTC sales etc…
Please contact us directly for more information on how our DTC eCommerce platform can help you.
What does the consumer receiving the alcohol shipment need to do? For consumers, to receive the alcohol shipment, they must be:
- Present to sign for the delivery, the alcohol package can NOT be left unattended and must be signed for by a person 21 or over. The consumer can have the package sent to a business address if needed.
- Age 21 or over and have a valid acceptable photo ID like a state ID, passport, military ID, or other valid ID for proof of age
- Not be intoxicated
