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State's Largest Beer Distributor Ending Wine Business, Laying Off 100 Workers

By Becca Costello

Posted May 24, 2018

The state's largest beer distributor is shutting down its wine distribution and laying off 100 workers, and company leaders say it's because the state won't allow them to sell hard liquor.

Monarch Beverage works with breweries and wineries to distribute beer and wine across the state. But under Indiana law, no company can distribute both beer and liquor.

Monarch has spent the last decade trying to get the law changed – they've petitioned lawmakers, state regulatory boards, and even filed a federal lawsuit, all to no avail.

"We've not been able [to change it]," says Monarch CEO Phil Terry. "Our competitors do not want to have to compete with us if we're able to sell beer and liquor. And they've prevailed in the legislature."

Monarch tried to set up a separate company to sell spirits, but the Indiana Supreme Court ruled against the company, denying it the permit.

Now Monarch's largest wine supplier, California-based E&J Gallo, has switched to a wholesaler that can distribute all their products, including liquor.

Terry says Gallo made up 80 percent of their wine sales.

"Which is why we have to exit the wine business," Terry says. "Without Gallo, our wine business is just not sustainable."

Monarch is selling its wine distribution to out of state wholesaler Johnson Brothers, the same distributor that Gallo now works with. The 100 Monarch employees losing their jobs may have a chance to work for the new company instead. The transition will take play by Sept. 1.

Terry says Monarch has no immediate plans to challenge the law further, but as more breweries add liquor products to their business, the issue isn't likely to go away.

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