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Ever wonder how beer makes it to the bar? SC laws have a lot to say on it

New South Brewery continues to grow as it approaches 20th anniversary

New South Brewery owner David Epstein discusses the brewery, and the journey to their 20th anniversary, which will come in 2018.
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New South Brewery owner David Epstein discusses the brewery, and the journey to their 20th anniversary, which will come in 2018.

Ray Strickland of Owen’s Bottle Shop advertises the latest beer his store offers on a Facebook page of Myrtle Beach beer lovers.

“Coming soon!!! Let me know if you want me to hold any, this is a one & done,” Strickland posted about a new beer from North Carolina.

People will ask him to reserve bottles or request something different altogether. But, due to South Carolina law, Strickland does not have absolute control over what beer his store offers. First, he needs to find a distributor.

South Carolina is a lucrative market for the alcohol industry. According to 247wallstreet, an economic investigation news outlet, South Carolina ranks 12th in beer consumption. But beer doesn’t go straight from the brewer to the customer. Distributors act as middle men, buying the beer from a brewery and then delivering it to a store for retail sales.

Distribution laws are a hot topic in the state and the greater beer community. Regardless, distributors are a necessary part of getting craft beer to thirsty patrons.

Strickland has been critical of the role some distributors can play in choosing which beers make it to the area. He prefers to go straight to the brewer, but instead has to ask his distributors to negotiate for him.

“We have lost business to places like Calabash, Wilmington and its surrounding areas. Businesses there can take a trip to a brewery, purchase product, then directly sell to customers in their retail locations,” he said. “We don’t have that luxury.”

Cans of beer adorn the shelves at Owens Liquor in Pawleys Island. Josh Bell

Beer tourism often leads people to travel to try the latest beer. Strickland is worried that distribution laws are giving an edge to stores in North Carolina.

North Carolina stores can get alcohol relatively easier. Relaxed distribution laws in North Carolina allow for stores to deal directly with a brewery or choose to use a distributor. Breweries that produce less than 25,000 barrels of beer can self-distribute.

While the laws are more relaxed across the border in North Carolina, that doesn’t stop the conversation. A recent lawsuit is seeking to eliminate the 25,000 limit.

Georgia saw new legislation last year that allows for direct sales from breweries to the customer, which is legal in South Carolina up to a limit. Yet, Georgia also does not allow direct sales from brewery to a retail store.

The free market arguments to change these laws are similar in all three states, with some breweries and consumers claiming it harms business and choice of beer. As the craft beer scene continues to grow in the Southeastern United States, so does the pressure to revisit alcohol laws.

That said, despite being critical of the law and advocating for it to be changed, Strickland said that he has had good and bad experiences with distributors. He prefers to work with smaller distributors that focus on local brands.

Johnathan McCutchen, a Bear Island distribution sales representative, works with Strickland as one of the store’s distributors. McCutchen said he is good friends with Strickland and sometimes works at Owens’ Liquor store on the weekends.

Bear Island is a small operation, which gives his company more flexibility in dealing with smaller breweries and deciding what products to carry, McCutchen said. They can go straight to a brewer, buy a keg and then distribute it to a store with little corporate red tape.

“I don’t have to push something I don’t like,” he said.

Dave Epstein, owner of New South Brewery in Myrtle Beach, has long been a supplier to Better Brands distribution of Myrtle Beach. He said his relationship with the big distributors has been good. But he said smaller breweries can have a harder time getting onto bigger portfolios.

Cleaning cans and beer kegs sit inside the New South Brewery in Myrtle Beach on July 30.

Better Brands distributes New South Beer and has about 50 other breweries its portfolio. It’s a relatively large distributor for the area, carrying many national brands like Budweiser or Sam Adams.

Bear Island only carries a handful of craft microbreweries, mostly from the Carolinas.

For Better Brands to add a company to its portfolio, they need to first reach out to the company to start the process. Then Mike Riley of Better Brands and his team test the product and evaluate the brand’s potential. Then, possibly, the beer will be added to the portfolio.

Epstein’s brewery, going on its 20th year of operation, has a lon- standing, positive relationship with Better Brands. He said that the distributor saves him time and money by handling that part of the business, allowing his folks to focus on the beer.

Yet, he acknowledges that smaller breweries without an established brand have a harder time getting a large distributor to include them in a large portfolio of beers.

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Riley said he sees his role as ensuring quality, acting as a gatekeeper of good alcohol in the area. His company takes pride in carrying a variety of quality craft beer and lets local stores know they’re getting a good product.

McCutchen agrees that distributors play an important role in making sure good beer reaches the market. He sees himself as a tastemaker, giving his recommendation of what beer is going to sell well.

No matter what, McCutchen said, the goal for him is to get good beer into the hands of thirsty consumers. Even if that sometimes means pointing a client to a different distributor.

“There is enough room for all others to have a slice of the pie,” he said.

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