{"id":262,"date":"2026-05-15T01:48:21","date_gmt":"2026-05-15T01:48:21","guid":{"rendered":"https:\/\/supporttips.com\/media\/?p=262"},"modified":"2026-06-09T23:29:39","modified_gmt":"2026-06-09T23:29:39","slug":"podcast-26-43-money-in-alcohol","status":"publish","type":"post","link":"https:\/\/supporttips.com\/media\/podcast-26-43-money-in-alcohol\/","title":{"rendered":"ST Media Podcast on Where is the Money in Alcohol?"},"content":{"rendered":"\n<h2 class=\"wp-block-heading has-text-align-center\">Listen Podcast on Where is the Money in Alcohol ?<\/h2>\n\n\n\n<figure class=\"wp-block-audio\"><audio controls src=\"https:\/\/supporttips.com\/media\/file\/aud-st-podcast-26-43-money-in-alcohol.mp4\" autoplay><\/audio><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">Transcript<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">(0:00 &#8211; 0:20)<br>Picture this, you&#8217;re sitting at a dimly lit trendy bar on a Friday night. Oh, setting the scene, I like it. Right, the ambience is perfect.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You order a craft cocktail and the bartender slides it over to you. It&#8217;s beautiful, perfectly garnished, the ice is crystal clear, and it costs you like $15. Minimum these days.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(0:20 &#8211; 1:17)<br>Honestly, yeah. Or maybe you&#8217;re at a nice dinner celebrating an anniversary and you order a $50 bottle of wine. Or perhaps you&#8217;re treating yourself to a $200 bottle of premium whiskey to keep on your top shelf at home.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">When you hand over your credit card for any of these experiences, you naturally assume that the big money like, the real profit, is swimming right there in the liquid itself. You assume you&#8217;re paying for the quality of the drink. Exactly.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You assume you&#8217;re paying for the master distiller&#8217;s time, the carefully aged oak barrels, the perfectly fermented grapes. But the reality, we&#8217;re completely wrong. So wrong.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">I mean, it is one of the most persistent illusions in modern consumer economics. Yeah. We look at the physical product, we taste the craftsmanship, and we intuitively anchor the financial value to that sensory experience.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But if you look at the actual balance sheets, the alcohol industry is basically a master class in financial misdirection. A master class in misdirection. I love that.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(1:18 &#8211; 1:24)<br>And that is exactly our mission for today&#8217;s deep dive. We&#8217;re going to pull back the curtain on the global booze business. Nice.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(1:24 &#8211; 2:41)<br>We&#8217;re going to completely bypass all that romantic marketing, the stories of monks brewing in ancient abbeys or families tending agave fields, and follow the cold, hard data to see where the real wealth is actually concentrated today. Because it&#8217;s definitely not where people think it is. Not at all.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">And today&#8217;s insights come from a really comprehensive financial analysis published recently by Support Tips. Yeah, they did an incredible job with this one. They really did.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">They&#8217;ve pulled together extensive global market data from 2025, along with financial projections for 2026, and all the way out into the 2030s. So, okay, let&#8217;s unpack this because the way this industry actually operates behind the scenes is just mind-blowing. It truly is.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">I mean, whether you are an investor looking for a smart play, an entrepreneur trying to break into the beverage space, or honestly just a curious drinker sitting at that bar you mentioned. Just enjoying your Friday night. Exactly.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Understanding the invisible parts of this value chain completely changes how you view your next drink. The alcohol industry generates hundreds of billions of dollars globally, but those staggering margins and that scalable wealth, they are hiding in the absolute last places you would expect. Okay, well, we need to start our journey at the most obvious place, right? The creation of the alcohol itself, the actual production phase.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(2:41 &#8211; 2:57)<br>Makes sense. If you walk through any midsize city today, you are guaranteed to stumble past a trendy microbrewery operating out of a renovated warehouse or a boutique craft distillery with a beautiful copper still in the window. Oh, they&#8217;re everywhere.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(2:58 &#8211; 3:13)<br>They really are. We have this highly romanticized idea of the independent maker passionately crafting small batches of spirits. But my understanding from reading the support tips analysis is that the current economic climate is absolutely brutal for these creators.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(3:14 &#8211; 3:32)<br>Brutal is an understatement. Really? So why are these small makers suddenly barely surviving? Well, they are caught in what we can essentially call the production trap. When a consumer thinks about the cost of making a craft spirit, they think about the expensive ingredients, right? Sure, the organic botanicals, the high quality grains.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(3:32 &#8211; 3:39)<br>Exactly. But the primary culprit suffocating these producers right now isn&#8217;t the liquid. It&#8217;s the packaging.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(3:39 &#8211; 4:46)<br>Wait, the packaging? The packaging. The physical vessel itself is eating their profit margins alive. Oh, wow.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It&#8217;s like selling a luxury watch, but spending all your profit on the velvet box it comes in. That is a perfect analogy. Just how bad is this packaging squeeze getting? The numbers are deeply concerning for producers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The support tips analysis points out that glass bottle prices alone are jumping 20% on average this fiscal year. 20%? Yeah. In one year? Yeah.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If we look at specific regional data in markets like India, we&#8217;re seeing costs hit 280 to 300 rupees per case just for the empty glass. That&#8217;s insane. Why is glass suddenly so expensive? I mean, it&#8217;s just melted sand, isn&#8217;t it? It is.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But melting that sand requires an astonishing amount of energy. Glass manufacturing is incredibly energy intensive, and global energy prices have been highly volatile lately. Uh-huh, right.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Energy costs. And on top of that, glass is heavy and fragile, making freight and logistics an absolute nightmare. When you look at the balance sheets of these beverage companies, packaging is now consuming 35% of net revenues for beer makers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(4:47 &#8211; 5:02)<br>35%. Yep. And for spirits, it&#8217;s eating up 25%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It&#8217;s an absolute margin trap. I want to make sure I&#8217;m visualizing this correctly. For every $10 a brewery brings in, $3.50 immediately goes out the door just to pay for the glass bottle and the cardboard carrier.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(5:02 &#8211; 5:18)<br>Precisely. Before they even pay for hops, water, yeast, labor, or rent. Exactly.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Before a single drop is brewed. What&#8217;s fascinating here is how this single variable cascades down the entire financial structure of a production company. I can imagine.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(5:18 &#8211; 5:35)<br>When over a third of your revenue is instantly vaporized by glass and cardboard, your operational flexibility simply disappears. The data shows that industry-wide EBITDA margins, which is a measure of a company&#8217;s core operational profitability. Right.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(5:35 &#8211; 5:49)<br>They&#8217;re projected to drop by 150 to 200 basis points, dragging them down to just 11.5 to 12%. Okay. So for anyone who doesn&#8217;t spend their day staring at financial charts, a basis point is just a hundredth of a percentage point.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(5:49 &#8211; 6:07)<br>Right. But when you are moving millions of bottles, dropping 200 basis points, a full 2% slice right off your overall profitability has to be devastating. It&#8217;s the difference between expanding your business and declaring bankruptcy, and the beer sector is getting hammered even worse, with operating margins dropping by 250 to 300 basis points.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(6:08 &#8211; 6:27)<br>Yeah. This structural reality means the traditional dream of owning a little distillery and slowly scaling it up is fundamentally flawed. Manufacturing alcohol is a losing game unless you have the sweeping global scale of a legacy conglomerate to, you know, ruthlessly negotiate those packaging costs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(6:28 &#8211; 6:36)<br>So if I am an entrepreneur and I want to launch a new gin brand today, I shouldn&#8217;t go buy a warehouse and a copper still? Absolutely not. Do not buy the still. Good to know.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(6:37 &#8211; 6:51)<br>The smart money in production is shifting rapidly toward contract distilling. You don&#8217;t build a facility. You pay a highly efficient, established industrial factory to formulate your recipe, and you focus 100% of your capital on marketing and branding.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(6:51 &#8211; 6:54)<br>Oh, I see. You leave the factory overhead to someone else. Exactly.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(6:54 &#8211; 7:03)<br>Let them worry about the energy costs and the glass supply chain. That totally reframes the entire craft movement for me. But it also leads us to a profound contradiction.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(7:03 &#8211; 7:27)<br>Well, if making the physical product is becoming prohibitively expensive and margins are shrinking that drastically across the board, how is this industry staying afloat? Because the major beverage corporations are still reporting really robust revenues. Ah, the answer to that contradiction leads directly to the next major pillar of the Support Tips report. It&#8217;s a survival mechanic known as premiumization.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(7:28 &#8211; 7:41)<br>Premiumization. Think about it. If you can&#8217;t make your margins on volume because producing each individual bottle costs too much, your only mathematical option is to extract significantly more money from the bottles you do manage to produce.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(7:41 &#8211; 8:03)<br>My immediate assumption would be that they just need to sell more drinks to make up the difference. Just push volume. That&#8217;s what most people think.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But the data says the exact opposite is happening. Really? Yeah. Across 22 major global markets, which, by the way, represents about 75% of all global alcohol consumption, overall beverage alcohol sales volume actually fell by 2% in 2025.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(8:04 &#8211; 8:12)<br>Wow. And the total value decreased by 4%. This was the first actual decline we&#8217;ve seen since the massive pandemic disruptions back in 2020.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(8:13 &#8211; 8:27)<br>So people are just drinking less liquid, but simultaneously they&#8217;re paying more for it. How is the industry orchestrating this? Consumer behavior is shifting in a way that perfectly aligns with corporate necessity. Consumers are trading up.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(8:27 &#8211; 8:35)<br>OK. They are buying fewer drinks, but they are gravitating toward higher tier products. The global data confirms this shift emphatically.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(8:36 &#8211; 8:48)<br>Let&#8217;s hear the numbers. Well, in India, for example, despite broader economic slowdowns, the premium and luxury liquor segments expanded 9% by volume and 12% in value in 2025. That&#8217;s a huge jump.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(8:48 &#8211; 9:03)<br>It is. Premium products now command an incredible 38 to 40% of all spirits revenue in that country. That is staggering.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">I think the report mentioned they were only at, what, 31 to 33% market share just back in fiscal 2023. Exactly. Getting that much ground in a couple of years is huge.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(9:03 &#8211; 9:19)<br>Is this strictly an emerging market phenomenon or? Oh, not at all. We see the exact same pattern in Western markets, too. If you look at the U.S. on trade, meaning sales at restaurants and bars, premium brands now account for over 35% of total spirits volume.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(9:19 &#8211; 9:41)<br>And the ultra-premium category has grown to a 6.2% share, driven heavily by the explosion in high-end tequila. Everyone loves tequila right now. Right.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">And even in the U.K., premium world lager is now the single largest subcategory in the long alcoholic drink segment, accounting for over a quarter of all volumes. Wait, hold on. I have to play devil&#8217;s advocate here for a second.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(9:41 &#8211; 10:19)<br>Go for it. Are consumers genuinely developing finer, more sophisticated palates? Did millions of people globally all suddenly wake up and realize that ultra-premium small batch tequila inherently tastes better? I see where you&#8217;re going with this. Right.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Or is the industry subtly forcing us into these premium tiers? Because based on the crushing cost of glass we just talked about, this whole craft ultra-premium movement feels less like a sudden global awakening of good taste and more like the industry literally could not afford to sell us cheap vodka anymore. That is a very sharp observation. If we connect this to the bigger picture, your skepticism is highly warranted.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(10:19 &#8211; 10:22)<br>Huh. I knew it. It is a symbiotic relationship, sure.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(10:23 &#8211; 10:37)<br>But it is heavily engineered by corporate necessity. The industry is aggressively leaning into premiumization with their marketing dollars because it fundamentally fixes their margin crisis. Because they can charge more for the same amount of glass.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(10:37 &#8211; 10:49)<br>Think about the physical logistics. It costs roughly the same amount of money to manufacture, bottle, and transport a standard $20 bottle of vodka as it does a $60 ultra-premium bottle. Because the glass weight is the same.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(10:50 &#8211; 10:59)<br>The freight cost on the truck is exactly the same. Exactly. The underlying liquid might cost a few pennies more to distill, but the physical supply chain costs are identical.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(11:00 &#8211; 11:17)<br>So by convincing you through marketing that you need to trade up for a superior lifestyle experience, they multiply their profit margin exponentially. That makes so much sense. They extract significantly more value from fewer actual drinks, completely offsetting both the volume decline and the packaging inflation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(11:17 &#8211; 11:23)<br>I never considered the logistics of it that way. It&#8217;s an incredibly elegant solution to a supply chain nightmare. It really is.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(11:24 &#8211; 11:35)<br>So we&#8217;ve established what people are buying. Less total volume, but heavily skewed toward premium quality. But that naturally changes how they shop.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(11:36 &#8211; 11:51)<br>If I&#8217;m spending $80 on a bottle of whiskey, I don&#8217;t want to buy it from a dusty corner convenience store. I want a premium buying experience. Which brings us to a sweeping shift in retail behavior that is completely upending the traditional power dynamics of the beverage world.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(11:52 &#8211; 12:01)<br>We are seeing an absolute explosion in alcohol e-commerce. And historically, alcohol has been one of the most difficult products to sell online. Oh, incredibly difficult.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(12:01 &#8211; 12:15)<br>Why is that? We&#8217;ve been able to buy almost anything else online for two decades. Why was alcohol so far behind? It comes down to incredibly complex, antiquated regional laws. In the United States, for example, you have the legacy of Prohibition.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(12:17 &#8211; 12:28)<br>When Prohibition ended, the government instituted the three-tier system to prevent monopolies. Producers had to sell to distributors, who then sold to retailers, who finally sold to consumers. Sounds like a lot of middlemen.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(12:29 &#8211; 12:45)<br>It&#8217;s a maze. Add in Tidehouse laws that prevented breweries from owning bars, and state-by-state variations on what could even cross borders, and building a national e-commerce platform for alcohol was just a legal labyrinth. But the dam is finally breaking on those regulations, isn&#8217;t it? It is shattering.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(12:45 &#8211; 12:58)<br>Let&#8217;s look at the valuations from the Support Tips report. The global alcohol e-commerce market was valued between $65.07 billion and $73.91 billion in 2025. That&#8217;s a massive baseline.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(12:58 &#8211; 13:10)<br>It is. But the trajectory is what investors are really watching. It is growing at a compound annual growth rate, a KGR of 17.1%, and is expected to hit $86.56 billion in 2026.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(13:11 &#8211; 13:21)<br>Wow. And the long-term projection suggests this market will skyrocket to over $161 billion by the 2031-2032 window. Here&#8217;s where it gets really interesting.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(13:21 &#8211; 13:39)<br>I hear KGR thrown around on financial earnings calls all the time, but in plain English, what does a 17.1% KGR actually look like on the ground for these companies? Good question. It means the market isn&#8217;t just growing. The growth is compounding aggressively year over year.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(13:40 &#8211; 14:02)<br>If an e-commerce platform moves $10 million of product this year, they are preparing their supply chains to handle nearly $12 million next year, and nearly $14 million the year after. It&#8217;s an exponential curve that is virtually unheard of in a legacy industry like beverage alcohol. We used to wander down liquor store aisles, and our choices were almost entirely dictated by shelf placement.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(14:03 &#8211; 14:13)<br>The brands that paid the most money to the distributor got the eye-level shelf space. Now the liquor store is just an algorithm. It&#8217;s another open tab right next to our Amazon cart or our grocery delivery app.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(14:13 &#8211; 14:25)<br>And this matters profoundly to the economics of the industry, because it allows savvy players to build direct-to-consumer or DTC brands. Bypassing the liquor store entirely. They are bypassing those traditional retail bottlenecks.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(14:26 &#8211; 14:37)<br>When you remove the physical brick-and-mortar liquor store from the equation, you remove an entire layer of retail markup. So the producer gets to keep that margin. They capture significantly more profit, yes.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(14:37 &#8211; 14:45)<br>But arguably more important, they gain direct access to consumer data. Oh, data. Always comes back to data.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(14:45 &#8211; 14:56)<br>Always. In a physical store, the brand doesn&#8217;t know who bought their tequila. In e-commerce, they know your email, your purchasing frequency, your demographic profile, and what ads you clicked on.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(14:57 &#8211; 15:07)<br>In the digital age, that behavioral data is just as valuable as the physical product. Which brings us to the final and frankly most surprising piece of this entire financial puzzle. Let&#8217;s hear it.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(15:07 &#8211; 15:19)<br>We&#8217;ve seen how the actual producers of the liquid are getting squeezed to death by glass packaging. We&#8217;ve seen how tech and data are taking over the sales channels. So we finally arrive at the ultimate question.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(15:20 &#8211; 15:37)<br>Where is the safest, highest margin money actually hiding in this industry right now? This is where the structural inefficiencies we discussed earlier become highly profitable for those who know where to look. The safest wealth isn&#8217;t in fermentation. It&#8217;s in the invisible profit centers, distribution rights, and liquor licenses.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(15:37 &#8211; 15:46)<br>Tell me about distribution. Let&#8217;s look at it. The data shows that holding the distribution rights for alcohol carries 20 to 30 percent profit margins.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(15:46 &#8211; 15:54)<br>20 to 30 percent. And what blows my mind is that the distributor takes on absolutely zero brand risk. None.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(15:54 &#8211; 16:00)<br>Zero. The distributor doesn&#8217;t care if a specific brand of artisanal gin suddenly falls out of favor with consumers. Right.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(16:00 &#8211; 16:05)<br>They just move on to the next trend. Exactly. They don&#8217;t have to spend millions on celebrity marketing campaigns.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(16:06 &#8211; 16:19)<br>They don&#8217;t worry about a bad batch of fermentation or a ruined crop of grapes. They simply move the heavy glass boxes from the port to the warehouse to the retailer. They act as a legally mandated toll booth on a highly regulated highway.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(16:19 &#8211; 16:29)<br>That&#8217;s a great way to put it. Because the law requires alcohol to move through them, they are guaranteed their cut regardless of which brand wins the popularity contest. It&#8217;s a bulletproof business model.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(16:29 &#8211; 16:41)<br>And then you have the liquor licenses themselves. The report highlights that in major metropolitan areas, a liquor license acts more like premium commercial real estate than a simple regulatory permit. Very true.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(16:42 &#8211; 16:53)<br>How does that mechanism actually work? It relies entirely on artificial scarcity. Many cities cap the absolute number of liquor licenses available to prevent oversaturation. Oh, I see.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(16:54 &#8211; 17:06)<br>Boston or San Francisco, for example, might not have issued a net new license in decades because you cannot get a new one from the city, a secondary market forms. So the license becomes a tradable asset. Precisely.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(17:06 &#8211; 17:13)<br>You could open a restaurant, be a terrible chef, run the business into the ground and close your doors after two years. Yikes, but it happens. It happens all the time.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(17:13 &#8211; 17:38)<br>But the physical piece of paper from the government giving you the right to sell alcohol, you can sell that paper to the next restaurant group on the secondary market. And because the city is growing, but the number of licenses is static, the value of that piece of paper appreciates completely independently of what liquid is actually being poured. It creates immense wealth for the license holders without them ever brewing a drop of beer.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(17:38 &#8211; 17:52)<br>That is wild. But the most fascinating shift in the entire data set, the real plot twist of 2025 and moving into 2026, is the explosion of the no and low alcohol sector. Oh, this is a huge trend.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(17:52 &#8211; 18:00)<br>This actually made me pause when I read the report. The volume of no alcohol beer has entirely doubled over the past two years. Doubled.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(18:00 &#8211; 18:18)<br>It is the fastest growing subsector in the industry right now. So what does this all mean? Wait, so you&#8217;re telling me the best way to make money in the alcohol industry is to either just move cardboard boxes around as a distributor, hold a government issued piece of paper in the crowded city, or take the alcohol out of the drink entirely? Honestly, yes. And this raises an important question.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(18:18 &#8211; 18:33)<br>Why is the deliberate absence of alcohol so highly profitable? Yeah, why is it? The mechanism comes down to taxation and consumer perception. Traditional alcohol is heavily burdened by regulation. You know, excise taxes, import duties, specific local vice taxes.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(18:34 &#8211; 18:43)<br>Right. When a company creates a premium no alcohol product, they entirely bypass a massive chunk of that regulatory and tax burden. But they don&#8217;t lower the price for the consumer.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(18:43 &#8211; 18:58)<br>Nope. Because of that premiumation trend we discussed earlier, I am still perfectly willing to pay that $15 craft cocktail price for a beautifully mixed, complex, zero proof drink at an ice bar. It is the ultimate margin hack.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(18:58 &#8211; 19:10)<br>The producer charges the premium alcohol price, but they do not pay the premium alcohol taxes. That is brilliant. Furthermore, they don&#8217;t have to deal with complex, time consuming fermentation and aging processes in the same way.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(19:10 &#8211; 19:24)<br>They are effectively selling flavored water, botanical extracts, and an elevated social experience at a luxury markup. It completely reorients how I view the business. The smartest players are simply finding the inefficiencies in the system and exploiting them.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(19:25 &#8211; 19:39)<br>Let&#8217;s quickly recap this journey we&#8217;ve just been on, because we covered a lot of ground today. We definitely did. We started by moving past the illusion of the $15 cocktail, only to uncover the brutal margin trap of glass and packaging that is currently crushing small producers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(19:40 &#8211; 19:51)<br>We explored how the industry threw itself the life raft of premiumization, basically convincing us all to drink less total liquid, but spend far more money on it. Classic misdirection. Right.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(19:51 &#8211; 20:20)<br>We mapped out how breaking legacy regulations is fueling a $161 billion future for a direct-to-consumer e-commerce. And finally, we found the invisible gold mines, the bulletproof toll booths of distribution networks, the secondary real estate market of liquor licenses, and the brilliant margin hacking of the zero-proof boom. It&#8217;s a completely different financial landscape than it was even five years ago, and the pace of change is only accelerating.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(20:20 &#8211; 20:32)<br>It really is. For you listening, the next time you are out to dinner and you order that shot of premium tequila, or you buy a craft beer at a local venue, take a second to look at the physical bottle. Think about the energy required to melt that glass.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(20:32 &#8211; 20:46)<br>Think about the distributor&#8217;s truck that legally had to bring it there. Think about the artificial scarcity of the license held by the bar you were standing in. Realize exactly who in that long, complex supply chain is actually pocketing your cash.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(20:46 &#8211; 20:56)<br>I promise you, the lion&#8217;s share of your money is almost never going to the person who actually fermented the liquid. Such a good point. And I&#8217;ll leave you with this final thought to mull over.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">(20:57 &#8211; 21:17)<br>If the fastest-growing, highest-margin sectors in the quote-unquote alcohol business are actually e-commerce logistics, real estate-like paper licenses, and premium drinks that contain literally zero alcohol, is it even accurate to call it an alcohol industry anymore? Or is it just a highly regulated logistics and lifestyle business cleverly masquerading in a glass bottle?<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Source<\/h2>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-support-tips wp-block-embed-support-tips\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"bb2SB43QlW\"><a href=\"https:\/\/supporttips.com\/news\/where-is-the-money-in-alcohol\/\">Where Is the Money in Alcohol?<\/a><\/blockquote><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; visibility: hidden;\" title=\"\u201cWhere Is the Money in Alcohol?\u201d \u2014 Support Tips\" src=\"https:\/\/supporttips.com\/news\/where-is-the-money-in-alcohol\/embed\/#?secret=1lwOmmLCOJ#?secret=bb2SB43QlW\" data-secret=\"bb2SB43QlW\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n","protected":false},"excerpt":{"rendered":"<p>Listen Podcast on Where is the Money in Alcohol ? Transcript (0:00 &#8211; 0:20)Picture this, you&#8217;re sitting at a dimly lit trendy bar on a Friday night. Oh, setting the scene, I like it. Right, the ambience is perfect. You order a craft cocktail and the bartender slides it over to you. It&#8217;s beautiful, perfectly [&#8230;]\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-262","post","type-post","status-publish","format-standard","hentry","category-podcast"],"_links":{"self":[{"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/posts\/262","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/comments?post=262"}],"version-history":[{"count":4,"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/posts\/262\/revisions"}],"predecessor-version":[{"id":483,"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/posts\/262\/revisions\/483"}],"wp:attachment":[{"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/media?parent=262"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/categories?post=262"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/supporttips.com\/media\/wp-json\/wp\/v2\/tags?post=262"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}