Alcohol manufacturing and distribution has been a source of controversy in our country now for over 80 years. There are three things you probably haven't heard about the alcohol payment regulations involving the past and the present. The industry has evolved somewhat and today's system is a result of that slow growth and change.
1. Laws of the Prohibition Era have mostly stayed the same.
Depending on where you are, there are still plenty of laws against buying and selling liquor on certain days. Prohibition of retail sales on Sundays is actually very common, although serving alcohol is sometimes still allowed in restaurants and bars. There are also private bars and liquor stores that are immune from these laws via membership. That determination is by state, county or city, depending on the laws there.
There are still laws in place about brewing your own beer, mixing distilled spirits, and selling such beverages. Obtaining a liquor license is fairly difficult and once acquired, licensing bureaus monitor all sales. Small stills of wine and beer in the US was almost non-existent fifty years ago. Today the US has earned its own esteemed reputation of harvesting hops, wheat and grapes and creating an entirely new culture of alcohol appreciation.
2. The United States makes up 3 categories with regard to making payment for alcohol shipment.
The categories for payment on receiving alcohol are:
There are 7 cash states, 16 term states, and the rest are a mixture of both. Within each group, alcohol payments and regulations are either the same or similar. Cash means only immediate payment upon delivery is acceptable. Term states accept some form of credit accounts with certain terms. Mixed states offer a little of both, separated by beer as one category and wine and spirits as another.
There has been a noticeable shift in the years past as legislation changes and states garner new classification. This is due to market trends and pressure from alcohol manufacturer's and vendors. Again, having freedom to sell and purchase freely is always the issue.
To learn more about alcohol regulations by state, click here to download the infographic.
3. Many states as referenced above still use COD as the only method of payment for alcohol, but EFT now qualifies as well.
EFT operates electronically which makes cash transfers faster and does not require a waiting period for funds to clear. A check is merely an authorization to withdraw from a buyer's bank account and deposit to the vendor's. In a constantly growing industry, COD is not the only form of payment for alcohol anymore.
After the end of prohibition, in 1933, thirteen years of the crusade to keep the country dry had failed miserably. Now, eighty-three years later, alcohol use is still laden with a host of restrictions. The premise is that alcohol is bad and that if it must exist, we have to regulate its use, sale and transport. The opposition being the ever-growing alcohol industry, which makes more and more leeway as their resources and allies increase with time and technology. The first approved payment by EFT was in 1991.
Allowing EFT (Electronic Funds Transfer) payments is one more way that the reigns are loosening on alcohol commerce in the US, although supporters describe it as simply a way to quicken delivery time and reduce collection responsibilities on delivery drivers, dealing with cash and checks, etc. EFT is especially popular and widely used for beer transactions because beer sells in such higher quantities and greater demand. Compliance with federal and state law is built-in to the EFT system which is another draw for retailers and distributors hoping to avoid any lapse in compliance.
Contact us for advice on modern payment and allocation between businesses today. We offer the most up-to-date compliancy in new guidelines and regulations for suppliers and retailers in any industry.