How To Invest In Barrels Of Whiskey Directly

Investing In Barrels Of Whiskey
Investing In Barrels Of Whiskey Directly

Good morning. This question has been asked multiple times, so I will make sure to fill you in. 

In the U.S.A., there is what is called the three-tier system,

The three-tier system of alcohol distribution is the system for distributing alcoholic beverages set up in the United States after the repeal of Prohibition. The three tiers are producers, distributors, and retailers. Producers include brewers, winemakers, distillers, and importers. The system’s basic structure is that producers can sell their products only to wholesale distributors, who then sell to retailers, and only retailers may sell to consumers.

The Goverment Agency In Charge Of Regulation
The Goverment Agency In Charge Of Regulation

Some states chose to become alcoholic beverage control jurisdictions after Prohibition. In these states, part or all of the distribution tier, and sometimes the retailing tier, are operated by the state government (or by contractors working under its authority) rather than by independent private entities.

In Washington, retailers may purchase alcoholic beverages directly from producers, may negotiate volume discounts, and may warehouse their inventory themselves. However, the three-tier system remains a de facto reality in Washington despite the law. The only state with a privately operated retailing and distribution system that does not require any form of the three-tier system is the [State of Washington.

Other states, such as New York, allow local distillers such as Terebelo, who are distilling locally, to sell directly to stores and consumers. This law was made to benefit the local economy, and it does. You can purchase now from a New York distillery, and I know Terebelo sells by the barrel. 

Interestingly he doesn’t sell his own distilled spirits as they are in high demand but will purchase under his license from the distillery of your choice and let them age under his license. 

In conversation, he says he has procured Tequila, bourbon, and scotch and has them aging in his warehouse. A legal twist you must know, he says, “a distillery may not sell unbottled spirits even when permitted to sell directly to the consumer.” This means that if you want to take your barrel home, you need to bottle it all in the distillery, bring it home and empty it back into the barrel. Interestingly, Binyomin says most people want to leave their barrels to age at the distillery as they know they will age correctly. Having an aging barrel in your house can lead to all sorts of problems, not to mention evaporation if you have forced air. 

I asked Binyomin how much a barrel costs? A barrel is roughly 300 bottles when not aged; evaporation can easily slice it in half after a few years. I would love to have a barrel made for my child as a birthday gift; he said around $2000 plus shipping and $15 a month for rent. You can have a birthday bottle shipped out yearly at an additional expense and only if you live where it is legal to ship to. I think I will buy a barrel with friends as a group instead of laying out all that cash myself and dividing it up in a few years just not sure if they will view it as an investment or a passion. Hey we can even put on our shuls logo as the label.

Binyomin’s, email is shoot him a email hes fun to chat with.

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