From Barrel to Bar: Why Liquor Producers Should Consider Selling Direct to the Public

Posted on October 7, 2024

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Craft beer, fine wine, and artisanal spirits have gained worldwide recognition as a new and emerging market. As a result, many producers in WA are discovering new ways to engage directly with consumers. Thanks to WA’s liquor licensing laws, those who produce their own alcohol now have the opportunity to expand their business from cellar doors to thriving hospitality venues that combine their love of craft with food and event offerings.

If you’re a distiller, brewer, or winemaker looking to take your business to the next level, here’s an insight into how you can grow your business and take advantage of what a Producer’s Licence will allow you to do.

What is a Producer’s Licence?

If you intend to sell and supply liquor that you have produced, you will need a Producer’s Licence*.   In order to obtain a Producer’s Licence you will need to show that you are a “genuine producer”.  There are three types of genuine producer under WA’s Liquor Control Act 1988:

  • Wine producers – must have sufficient yield from their vineyard, orchard or apiary to produce at least 5,000 bottles of liquor;
  • Beer producers – must possess commercial grade and scale of production facilities which involve the processing and fermentation of grain and encompass the entire brewing process;
  • spirit producers – must possess commercial grade and scale of production facilities to distil base products to produce spirits.

This licence category will allow you to sell and supply liquor for consumption off-premises, and to conduct on-premises tastings (e.g. cellar door). With the necessary facilities and health and planning approvals, you can also obtain approval for the public to sit down and consume standard liquor sales on your premises.

Producer’s Licence – Allowing Direct Sales

One of the most exciting opportunities for alcohol producers in WA is that a Producer’s Licence will allow you to sell your products directly to the public.

Under this licence, you can not only sell your product for off-site consumption (i.e. packaged liquor / takeaway sales) but also create a space where customers can taste, buy, and enjoy your creations on-site. This presents a unique chance to build brand loyalty by providing customers with a more personal and immersive experience to enjoy your liquor products.

This level of connection is a game-changer for brand building and customer engagement.

Creating a Hospitality Experience – Pairing Drinks with Dining

When considering a Producer’s Licence, you can take things further by adding a hospitality element to your operation. WA’s liquor laws allow producers to expand their offering to include food service.  Whether it’s a full-fledged restaurant, a casual café, or gourmet sharing platters, the ability to pair your beverages with a food menu adds an extra layer of attraction for visitors.

For instance, many wineries in WA’s famous Margaret River region have successfully integrated dining into their business, offering wine and food pairings that enhance the tasting experience.  Brewers and distillers are also catching on, creating spaces where people can enjoy craft beers or cocktails alongside gourmet burgers, tapas, or locally sourced meals.

A thoughtfully curated food menu can not only complement your products but also keep customers staying longer and spending more.

Hosting Functions & Events – Creating Unique Locations & Making Memories

If you have decided on including on-site facilities for the public to enjoy, there is no better way to showcase your business than by hosting private functions, weddings, or corporate events.

Licensed producers with the relevant facilities and approvals can use their premises as function spaces.  Whether it’s an intimate wine-tasting event, a corporate retreat, or a wedding reception surrounded by the beauty of your vineyard or distillery, events are a lucrative revenue stream.

With a unique venue and a range of hand-crafted drinks, your space could become a popular destination for locals and tourists alike.

By offering a bespoke experience, such as guided tastings, educational tours of your production process, and tailored food and drink packages, you can position your business as a destination in itself.

Building Brand Loyalty Through Experiences

Consumers are increasingly drawn to brands that offer more than just products – we all crave new experiences.

By creating a venue that combines the craft of alcohol production with hospitality and event space, you can build deeper connections with your customers. These visitors aren’t just buying a bottle of wine or a pint of beer, they become engaged with the story behind your product, learning about the process, and meeting the makers.

This kind of brand experience fosters loyalty and turns casual customers into long-term supporters. By offering memberships, exclusive tastings, or behind-the-scenes tours, you can create a community of loyal supporters who will keep coming back for more and will be eager to spread the word about their experience to everyone in their circle.

Collaborating with Other Local Producers

Many alcohol producers are teaming up with local farmers, cheese makers, bakers, and other artisans to create one-of-a-kind food and drink pairings. These collaborations not only support local businesses but also enhance the overall customer experience and make your venue’s services very distinctive.

Imagine a brewery offering beer and charcuterie pairings with products from local farms, or a distillery hosting a cocktail evening with locally sourced seafood. These kinds of partnerships enrich your menu and reinforce your position within WA’s growing community of local producers.

Navigating the Licensing Process

Of course, all of these opportunities come with the need to navigate Western Australia’s liquor licensing regulations. The Liquor Control Act 1988 governs the sale and supply of alcohol in WA and depending on your business model, a different class of licence might be more suitable (e.g. Tavern licence, Special Facility Licence) to ensure you have the flexibility you need to deliver your concept to the market.

That’s where Fraser & Associates Lawyers can help you to consider if a Producer’s licence meets your requirements and guide you through the application process.

NB: * In some circumstances the Liquor Control Act 1988 does not apply, with exemptions provided for in the Liquor Control Regulations 1989:. https://www.dlgsc.wa.gov.au/department/publications/exemptions-to-the-liquor-control-act-1988