Retail

How Alcohol Delivery Suddenly Stopped Being Amazon-Proof

Until Amazon’s acquisition of Whole Foods, the logistics of alcohol delivery were mostly outside the grasp of what Amazon could efficiently cover. Intoxicating liquor can’t be mailed in the U.S., and using private delivery companies like FedEx or UPS entails dealing with strict requirements — and that’s in addition to whatever state and local rules apply.

Once all those factors are accounted for, though, delivery agents still need to check the ID of every single purchaser.

While Amazon has dabbled in alcohol, over the summer it quietly expanded its delivery service through Prime Now, one of its offerings which is primarily focused on grocery delivery. The magic is accomplished through Amazon’s recent purchase of Whole Foods, a foothold which helps the retail firm realize its “strong interest in home delivery of beer,” Coors, a division of MillerCoors brewing company, wrote in a blog post about the merger.

It could, for instance, allow consumers to “click and collect” beer at a local Whole Foods.

“Beer is very different from other consumer categories that have been disrupted by Amazon,” Coors said in the merger blog post. “But there’s little doubt that the industry will feel the impact of the largest online retailer expanding into grocery.”

This is less-than-great news for Thistle and Drizzly, startup firms which both specialize in alcohol delivery, Blue Apron which pairs wine with food and logistics company Postmates, which recent began delivering alcohol as a service.

The industry has lingo for the holy grail of liquor delivery: the “three-tier system” of distributors, retailers and producers considered the only way to fairly abide by the laws.

But Duane Stanford, executive editor at Beverage Digest, says that system might be on the edge of disruption.

“The three-tier alcohol distribution system is a complicated web of state-by-state laws that make it tough to scale online delivery,” Stanford said. “If anyone can apply pressure and creativity to the problem, however, it’s Amazon, and Whole Foods gives [Jeff] Bezos yet another paint brush.”

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