The country’s second-largest distributor, Republic National Distributing Company (RNDC) has been shedding suppliers at an alarming rate, with another major national loss announced today.
Following Brown-Forman’s exit from RNDC in California this month, the whiskey giant will now follow suit in other states.
“This milestone marks an exciting evolution in our U.S. strategy, building upon our commitment to elevate our premium spirits portfolio and reach consumers in impactful ways,” said Michael Masick, executive vice president and president of the Americas for Brown-Forman, in a release.
This is Brown-Forman’s first significant change to its U.S. route-to-consumer landscape in more than 60 years. The company’s decisions “underscore Brown-Forman’s enduring commitment to ensure its brands have the dedication, focus, investment, and route-to-market capabilities needed to succeed in the increasingly dynamic beverage alcohol industry,” according the release.
The Jack Daniel’s maker is the latest name to drop RNDC, just a few weeks after Anheuser-Busch-backed Cutwater, the second-largest spirits-based RTD, exited RNDC in California, Hawaii, and 13 control states. Cutwater will be making the move to competitor Southern Glazer’s Wine & Spirits (SGWS).
Beginning August 1, 2025, Brown-Forman will move its portfolio across 13 markets (all open states), a transition that will involve seven new distributor organizations. The updated distribution partnerships include:
- Johnson Brothers in Indiana, Minnesota, Nebraska, North Dakota, South Dakota, and Texas.
- SGWS in Louisiana and New York; Continued alignment in Arkansas, Kansas, Massachusetts, Missouri, and Rhode Island.
- Columbia Distributing in Washington.
- Keg-1 River City in Kentucky.
- Oklahoma Spirits Alliance, a partnership with Capital, LDF, and Fisher 59 Distributors in Oklahoma.
- Reyes Beverage Group in Hawaii and as previously announced in California.
- Specialty Imports in Alaska.
In addition, as a result of the reshaping of the company’s U.S. distributor relationship landscape, Breakthru Beverage Group (BBG) will become the company’s largest national distributor partner, covering 14 key markets across the U.S. and Canada.
The loss of Brown-Forman is another major hit for RNDC, whose former CEO, Nick Mehall, departed the company in February after Brown-Formand and its top-selling spirit brand, Tito’s Handmade Vodka, announced their departures in California, the country’s largest spirits market. Earlier this year, the distributor said that it is “facing tighter margins, higher costs and shifting consumer preferences,” in a statement. Now, it may be in even more trouble.
Major Market Losses, Distribution Shake Ups
Brown-Forman is among other spirits suppliers who are possibly aiming to optimize their positions with beer distributors who have been faster to embrace total beverage and are equipped with appropriate capacities, such as Keg-1 in its own backyard.
In California, Reyes Beverage, which has distributed Brown-Forman’s Jack Daniel’s & Coca-Cola ready-to-drink (RTD) in California since its launch in 2022, nabbed the whiskey giant’s entire portfolio. High Noon and Tito’s also moved to Reyes in California.
The jump to Reyes, a traditional beer distributor, was likely for its connection to the convenience channel and command over cold boxes. Reyes, the largest beer distributor in the country, has been steadily growing its spirits and RTD portfolio, including with Sazerac’s recent BuzzBallz acquisition. The distributor has been gobbling up smaller beer distributors across California since 2018.
Sazerac was one of the first major spirit suppliers to begin moving its brands to beer wholesalers in 2022 by dipping its toes in the water with beer distributors in Washington and Colorado. It dove in further in early 2023, announcing plans to leave RNDC and move to a combination of beer and spirits distributors, including Reyes, in California, Hawaii and some markets in Texas.
Cutwater took a different path as Reyes operates a partnership with an A-B competitor, Molson Coors, leaving different options for the A-B backed brand. In that case, the switch to SGWS may have to do with moving products in control states, where liquor placements are more regulated to state stores anyway.
But Brown-Forman’s move alone to Johnson Brothers, a smaller operation, spells trouble for RNDC beyond the Golden State. With losses in California, the company was clearly looking to shore up its business in another leading spirits market by announcing on May 13 a “strategic reinvestment” in its Texas operations by adding over 100 new roles, with a focus on the on-premise. The company had reportedly laid off a number of positions in Texas earlier this year.
RNDC’s recent efforts in the Lone Star State could have been a reaction to Johnson Brothers announcing its entry into the Texas market through acquisition of the Texas, Arizona, Colorado, and Florida departments of Maverick Beverage Company in April. It’s unclear if the loss of a major supplier in the state could derail RNDC’s plans to reinvest.
Meanwhile, the exodus in California has already caused layoffs in California for RNDC, with at least 60 employees in California let go in March, which coincided with Tito’s exit on April 1.