Brands | Read Time: 2 minutes

Alcoholic Beverage Contract Manufacturing in Florida: Two Model Processes

Sometimes an alcoholic beverage brand developer wants to focus on developing and promoting a product brand and leave the manufacturing to someone else (sometimes called “white labeling”). This can mean good business for the manufacturer too. Whether the product is classified a beer, wine, or distilled spirits, a variety of contract manufacturing arrangements are available in Florida. This article describes two model contract manufacturing arrangements: (1) contract manufacturing with a licensed brand owner, and (2) contract manufacturing with an unlicensed brand owner. Contract Manufacturing with Licensed Brand Owner Brand owners that have a Florida manufacturer (CMB, AMW, or DD) license or a Florida Broker-Sales Agent (BSA) license can contract with a contract manufacturer to make and package the products and deliver them to a licensed distributor. This is often the best arrangement when the brand owner wants to take an active role in the supply process and wants to designate its own distribution partners. In this arrangement, the contractor sells the finished products to the licensed brand owner and delivers possession directly to the distributor. For the brand owner, this means that it can collect payment directly from its own distributors. For the contractor, this means that it is not required to add the brand owner to its own manufacturing license. Contract Manufacturing with Unlicensed Brand Owner In some cases, the brand owner does not have a Florida manufacturer license or BSA license. This might be the case where the brand owner is content to let its products be sold through the contract manufacturer’s own distribution partners. In this arrangement, the brand owner grants to the contract manufacturer a license to make the products, and the contract manufacturer pays the brand owner a licensing royalty. For the brand owner, this means that it will be paid directly by the contractor. For the contractor, it means that the brand owner because an Interested Party that must be included on its manufacturing license. Do you have any questions about alcoholic beverage contract manufacturing in Florida? Contact us at contact@brewerlong.com to schedule a consultation with a beverage attorney. Because we’re attorneys: Disclaimer.

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Brands | Read Time: 3 minutes

Tips for Effective Management for Beer Brand Distribution in Florida

In Florida, it’s common for beer suppliers and distributors alike to speak in terms of the appointment of a supplier’s exclusive distributor. This is not technically accurate in the context of the Florida Beverage Laws. A beer supplier is not required to appoint an exclusive distributor for itself in Florida. Rather, a supplier is required by Florida law to appoint exclusive distributors for each beer brand it chooses to distribute in Florida. The focus (and the franchise) is on the brands, not the brewery. With that brands-focus in mind, here are 3 tips for beer suppliers’ to better manage their appointment of exclusive distributors for beer brands. Tip #1: Avoid “All Brands and Extensions” Distribution Agreements It is common in Florida for beer distribution agreements to apply to “all brands and extensions” of the supplier. So common, in fact, the a large Florida distributor recently made the following statements in a federal court pleading: “Beer distribution agreements in Florida are not amended for every new brand because they are covered by Florida Beer Franchise Law, which makes it so that once a case of a brand is sold the distributor has the distribution rights for all brands.” This statement, and the practice of distribution agreements covering “all brands and extensions”, is not consistent with the Florida Beverage Laws concerning brand distribution. Florida Statutes Section 563.021(1) provides: “Where a manufacturer or importer sells several brands, the agreement may apply to all brands sold by the manufacturer or importer or may apply to one brand or several brands so long as each brand is covered by an exclusive territorial agreement.” (emphasis added) Beer suppliers should exercise extreme caution before agreeing to distribution agreements that cover “all brands and extensions” of the supplier. Making this agreement robs the supplier’s future self of the freedom to make strategic decisions about the distribution of its future brands and brand extensions. Tip #2: Select the Right Distributors in the Right Territories for the Right Brands Provided that all brands distributed in the State of Florida are covered by an exclusive territorial agreement, beer suppliers can pick the right distributors for the right brands. Suppliers can have two or more distributors within the same distribution territory, as long as each of those distributors has the franchise to distributor different brands. Likewise, suppliers can appoint different distributors to distribution the same brands in different territories. Granting the right to exclusively distribute all beer brands to one distributor in a territory is probably the right decision in many cases (particularly considering economies of scale), but it is not a requirement of the Florida Beverage Laws. Beer suppliers have greater flexibility in deciding the right distributor to distribute each of its brands. Tip #3: Craft Distribution Goals and Terms that Fit the Brand Even for territories in which a beer supplier has designated one exclusive distributor for all of its brands, different terms, requirements, expectations and goals might apply to some of those brands. For instance, consider a brewery’s flagship brands versus its seasonal brands. It is not inconsistent with the Florida Beverage Laws that a beer supplier and distributor agree on terms that recognize that not all brands–even from the same supplier–should be treated the same. The one exception comes to the terms that apply to specific beer brands concerns pricing. The Florida Beverage Laws prohibits the distribution agreement from setting the distributor’s prices for sales to retailers. See Fla. Stat. s. 563.021(3). This includes not only explicitly set prices but also formulas, markup factors, or other methods of fixing prices. Distributors are guarantee the right to determine their own prices to retailers. Do you have questions about crafting the perfect Florida distribution agreements for your beer brands? We’d love to discuss it with you. Contact us at contact@brewerlong.com to schedule a consultation. Because we’re attorneys: This blog post is provided on an “as is” and “as available” basis as of the date of publication. We disclaim any duty to update or correct any information contained in this blog post, including errors, even if we are notified about them. To the fullest extent permitted by law, we disclaim all representations or warranties of any kind, express or implied with respect to the information contained in this blog post, including, but not limited to, warranties of merchantability, fitness for a particular purpose, title, non-infringement, accuracy, completeness, and timeliness. We will not be liable for damages of any kind arising from or in connection with your use of or reliance on this blog post, including, but not limited to, direct, indirect, incidental, consequential, and punitive damages. You agree to use this blog post at your own risk. Regarding your particular circumstances, we recommend that you consult your own legal counsel–hopefully BrewerLong.

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ABT | Read Time: 6 minutes

The Compliant Florida Beer Festival

Craft beer festivals are tremendously popular in Florida. The multiplication of beer festivals throughout the state has caused the state’s principal regulator of alcoholic beverages–the Florida Division of Alcoholic Beverages and Tobacco (the ABT)–to take a closer look at how beer festivals are operated. Like all activities involving alcohol beverages, Florida beer festivals are subject to a confusing web of state and local laws and ordinances. The following tips are intended to help organizers of Florida paid-admission beer festivals understand how state and local laws and ordinance may impact their festivals.

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Brands | Read Time: 5 minutes

Choosing Trademark-Safe Names: 5 Questions

There are only so many hoppy, reserve, barrel-aged names to go around. This means that more and more otherwise happy, brotherly-loving brewers, vintners and distillers are taking aim at each other over company names and product names that may or may not be infringing on one another. Before deciding your next beer MUST be named Brewers’Law Lager, or whatever, ask these 5 questions.

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