Broker vs. Distributor: What’s the Difference?
Understanding the Roles Brokers and Distributors Play
What is the difference between a beverage broker and a distributor?
A beverage distributor purchases, warehouses, and delivers product to retailers while operating within the three-tier system. A beverage broker represents brands by selling into accounts, supporting distributor sales teams, and driving market execution without taking ownership of inventory. Distributors focus on logistics, compliance, and access; brokers focus on sales execution and velocity.
One of the most common points of confusion for beverage brands is the difference between a broker and a distributor. While both play roles in getting products into accounts, their responsibilities, incentives, and impact on execution are fundamentally different.
Understanding this distinction is essential to building a scalable sales and distribution strategy.
What a Beverage Distributor Does
A beverage distributor operates as a licensed wholesaler within the three-tier system. Distributor responsibilities typically include:
- Purchasing product from suppliers
- Warehousing and managing inventory
- Selling to retail and on-premise accounts
- Handling physical delivery and logistics
- Managing tax collection and regulatory compliance
Distributors provide market access and infrastructure. However, they manage large portfolios and tend to prioritize brands that already demonstrate sales potential.
What a Beverage Broker Does
A beverage broker acts as an outsourced sales and market development partner. Brokers typically:
- Represent brands to distributors and retail or on-premise accounts
- Call on accounts and secure placements
- Support distributor sales teams
- Execute tastings, education, and promotions
- Drive early velocity and market traction
Brokers do not take ownership of inventory. Their value lies in focused sales execution and relationship leverage.
Key Differences Between Brokers and Distributors
Area
Inventory Ownership
Compliance Responsibility
Sales Focus
Market Access
Incentives
broker
Direct selling and placement
Indirect
Commission-based
distributor
Portfolio management
Direct
Margin-based
These differences have meaningful implications when designing a go-to-market plan.
When Beverage Brands Should Use a Broker
Brokers are often most valuable when brands are:
- Launching in a new market
Needing additional sales velocity - Educating distributor sales teams
- Targeting specific accounts or channels
- Operating with lean internal sales resources
For many brands, brokers serve as the bridge between strategy and execution.
When a Distributor Alone Is Not Enough
While distributors handle access, logistics, and compliance, they rarely provide the level of hands-on selling required by emerging brands. Without broker or internal sales support, brands often struggle to gain traction within distributor portfolios.
Distribution provides access; execution drives results.
Using Brokers and Distributors Together
High-performing beverage brands frequently use brokers and distributors together:
- Distributors handle compliance, warehousing, and delivery
- Brokers drive placements, education, and sell-through
This hybrid approach aligns incentives and accelerates market momentum.
Closing Insight
Brokers and distributors serve different but complementary roles. Beverage brands that understand how to deploy each strategically gain faster traction, stronger distributor relationships, and more sustainable growth.
Yours, truthfully,
Sam
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Sam Anderson
Co-Founder, BevAssets
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