CAZENOVIA — Cazenovia resident Chad Meigs recently announced the upcoming launch of Third Space Distribution LLC dba Drink NY Craft (DNYC), a start-up craft beer distribution company that specializes in direct-to-consumer sales across New York State.
The goals of the e-commerce marketplace are to provide every beer-drinking New Yorker with the opportunity to have the state’s rarest beers delivered directly to their doorsteps, and to expand the reach of local breweries hoping to take the leap into the commercial realm.
Meigs, who is president of the company, has been running The Bineyard (thebineyard.com), a commercial hop yard in Cazenovia, for 11 years.
“I’m responding to many of my brewery customer complaints of how the three-tier distribution system only works for one tier, the distributor,” Meigs said.
According to the National Alcohol Beverage Control Association, the three-tier system of alcohol distribution was developed in the US after the repeal of Prohibition. The basic structure of the system is that manufacturers (tier 1) provide alcoholic products to wholesalers (tier 2), who distribute the products to retailers (tier 3), who sell to the consumers. No one entity can be involved in more than one tier under most state models and each tier is regulated and licensed separately.
“We’re launching DNYC to disrupt ‘traditional’ distribution and give power back to the producer and consumer,” said Meigs. “It’s been about two years in the works, but the seeds have been planted over my 11 year relationships with my current hop farm brewery customers.”
Set to launch in Oct. 2021, DNYC’s online platform will provide beer enthusiasts with access to a vast selection of craft beers, regardless of whether they choose to join “The Club” or purchase single beers.
The Club is a subscription that includes a personalized case of craft beer delivered to members’ doorsteps every month.
Single beers can be purchased from an online store that features a 360-degree shopping experience and descriptions detailing the aroma, appearance, mouth feel, body, and conditioning of each brew.
“Our main customer is the beer geek whose ‘favorite beer is the one that they haven’t tried yet,’” said Meigs. “ . . . You no longer have to travel to the brewery to get that beer; you’ll be able to get it through our platform and have it delivered to your doorstep via a common carrier. Again, these are the breweries you won’t find at Wegman’s or at your local convenience store.”
By enabling direct-to-consumer sales, DNYC aims to help New York’s nano breweries evolve into microbreweries or regional breweries.
Meigs defined a nano brewery as an operation with a three-barrel production capacity or less (per batch). Meanwhile, a microbrewery produces fewer than 15,000 barrels annually, and a regional brewery produces between 15,000 and 6 million barrels annually.
“‘Traditional’ distribution is set up to reward the larger regional breweries,” said Meigs. “It’s a volume game; the more you produce, the more marketable you are. We are looking to turn this upside down. We want to help the little guy grow and scale. We know the market is there, we just need to get it out to the masses, and what is a better way than e-commerce in a post-COVID economy? The timing now is perfect.”
Meigs also highlighted the disparity between the number of small breweries and the number of larger regional breweries throughout the state.
“New York State has approximately 480 breweries; most of them are nano or micro and a handful are regionals — think Saranac, Ithaca, etc.,” he said. “Most of these little guys started as home brewers and took it professional with little or no business experience. To make that leap from a hobby brewery to a production brewery takes capital and expertise. We hope to provide assistance to those breweries looking to make that leap.”
According to a Sept. 15 press release from the company, DNYC plans to empower “the little guys” to scale by offering an off-premise sales channel, by providing them with the ability to market to all of NY, by aggregating multiple brands on one e-commerce platform, and by enabling them to increase their overall visibility.
“Creating this win-win situation will put DNYC in breweries’ favor and result in two parties that want to work together,” Meigs said in the press release. “We aim to be these breweries’ biggest customer by empowering them to scale in the off-premise sales market.”
DNYC will also have a support center/warehouse at the CNY Regional Market in Syracuse to help breweries with various matters, such as distribution, sales, ingredient purchasing, packaging, and storage, as they continue to grow.
Breweries interested in learning more about DNYC should email [email protected].
Customers can secure a 10 percent discount on their first purchase before the marketplace launches by subscribing to DNYC on drinknycraft.com.
