Millennials hold more of the purse strings these days but are spending less on beer and alcohol and have substantially cut their trips to beer and liquor stores since the pandemic. In light of these shifting consumer habits, brands like yours often ask how to ship beer and alcohol directly to these consumers’ homes.
The good news is that craft beer sales volumes are expected to increase through 2025. That growth happens even as overall beer sales decline. That means the custom brews you’re creating have a large audience. Now, you just need the right fulfillment plan to get things started and avoid hefty fines.
Start with licensing
The U.S. has a three-tier system for licensing within the beer, wine, and alcohol space. Suppliers, wholesalers, and retailers each have their own license requirements. Retailers generally have the only direct-to-consumer options available to them, including direct-to-consumer shipping. In some states, small breweries can be considered retailers. So, they can sell goods directly to consumers in taprooms or via mail.
Retailers need standard licenses to sell beer and liquor in their state and then must get an additional license for any online sales or deliveries through the mail. They’ll also need a specific relationship with a carrier for alcohol sales and delivery. If you use a 3PL, they can manage part of this relationship. However, you and the 3PL will need to maintain proper licensing.
Here’s how carriers approach how to ship beer via their networks:
- UPS only ships beer from shippers licensed under applicable law who have signed an Agreement for Approved Beer Shippers. You are still responsible for following all state laws and shipping to only valid customers.
- FedEx will only ship beer from businesses with verified licenses that are enrolled in the FedEx alcohol shipping program. You must ensure that you follow state rules for consumer sales. And, ensure any business you ship to also has appropriate licenses in that state.
- USPS does not allow you to ship beer, wine, or liquor through the mail. The service is very adamant about this and even prohibits people from using boxes that have alcohol labels on them.
State licensing requirements are different, so let’s look a little closer at these options and demands.
Reaching directly into homes
For drink brands learning how to ship beer and alcohol, the direct-to-consumer (DtC) market is one of the most compelling. It was growing even before the pandemic but has now expanded significantly as customers realize they can get a variety of beer styles and as people lose access to craft stores that have shut their doors.
The concern you face is that there’s no uniform set of laws or regulations governing DtC shipments. Laws vary by state. You’ll need to be compliant based on where you are shipping each DtC sale from and to. Because these rules tend to change every few years, it’s important to work with a 3PL or fulfillment partner that can help you navigate these waters and maintain proper compliance.
Names for licenses vary and include things like “Beer Shipper’s License,” “License to Direct Ship to Consumers,” “Direct to Consumer Shipper License,” and “S1” shipping licenses.
According to compliance software maker Sovos, 11 states and the District of Columbia have laws allowing DtC beer shipments. Each comes with a unique set of requirements. For example, Oregon only issues shipping licenses to breweries located in one of those 11 states. They also have different sales and excise tax requirements.
Fulfillment requirements of how to ship beer to consumers
No matter how you ship beer DtC, there are some must-have pieces of information to gather at the time of purchase and use at the time of shipping. The most important is age verification. This governs your entire online experience.
Beer and alcohol brands must ensure that website visitors are of legal drinking age before they take any action on a website. That means gates before browsing, adding to carts, and especially checkout processes. Often, you’ll need to do this again at checkout by collecting the buyer’s date of birth. If the shipping address is different, you need to collect age information for the recipient.
For the fulfillment process, all DtC beer and alcohol shipments require your carrier to check the ID of the recipient and obtain their signature. You ensure this during your order fulfillment process by selecting these options from your carrier’s shipping services. Even though the carrier performs the check, you’re responsible for ensuring that the carrier is told to do this.
According to Sovos, some states also limit the amount of beer you can ship to any given consumer. Your DtC shipments may be limited by monthly or total caps, often around two cases per month or up to 24 cases per year.
Shipping beer to retail partners
If you can’t get the required licenses to reach consumers, your business may investigate broader licensing to be able to ship to retail partners. Depending on the state and what you ship, a “manufacturer’s and wholesaler’s” license may be all you need to ship beer to these partners. Thankfully, these licenses tend to get approved quickly. Here’s an example from the state of Maryland.
That may be your easiest route to begin selling your beer in more areas. However, you’ll want to ensure that your warehouse or 3PL partner knows and follows the rules when focusing on how to ship beer. Licensing must be maintained, or you’re at significant risk for fines, penalties, loss of your production license, and even cease-and-desist letters.
It’s a complex market. Find and work with partners you trust. And always ask plenty of questions before you get started. That’s the mindset we at Red Stag Fulfillment encourage. Our inbox is always open for questions and concerns, so we can help you build or find the perfect fulfillment solution for how to ship beer and other goods to your hungry audience.
