Craft breweries across Illinois are paying close attention to a new bill that could revolutionize the way they serve their customers.
On Feb. 10, 2023, the Illinois Craft Brewers Guild filed legislation seeking to legalize direct-to-customer shipping for craft breweries — something they haven’t been able to do because of current laws on brewery self-distribution.
The bill, SB2193, sponsored by Sen. Ram Villivalam, would amend the Liquor Control Act of 1934 and allow people with certain brewer licenses to ship the beer they make directly to Illinois residents over 21 for the purpose of personal use.
According to the organization, craft breweries first began their meteoric ascension in Illinois in 2011, after breweries were first allowed to self-distribute, or sell their product directly to retailers, bars and restaurants without having to go through a third-party distributor.
This model of self-distribution, which is still in effect, allowed beer producers to spend less money on third-party contractors and have more direct access to retail and hospitality industries to sell and market their products.
However, the Craft Brewers Guild said this model doesn’t meet the need of the modern craft brewing industry — especially for small, independent brewers that don’t distribute widely and breweries that create unique drinks that might have a higher cost to produce.
“The fact that Illinois laws force some craft breweries to contract with third-party distribution is antiquated and unnecessary,” Illinois Craft Brewers Guild Executive Director Ray Stout said. “It creates an intentional power imbalance between local breweries and consolidated distribution corporations through the enforcement of what are called ‘franchise laws.’”
Stout pointed out difficulties created by the Beer Industry Fair Dealing Act, which requires brewers to create contracts with distributors, which he said can be nearly impossible to terminate and give more decision-making power to the distributor to the detriment of the small businesses they contract with.
The guild also noted that Illinois wineries have been able to ship directly to customers for over 15 years, saying that fact proves that direct shipping of alcohol can be done safely and responsibly with little to no impact on retailers.
The bill resides in the Illinois Senate after its filing and initial reading on Feb. 10.