In the on-premise, there are still winners out there. I’m out all the time and I’m often seeing places mobbed, similar to pre-pandemic. But in other places you see more softness. We’re seeing growth in some of the sub-channels like travel, leisure, hotels, entertainment venues, country clubs. We’re trying to focus on where the consumers are and maximize that as much as possible.

SND: What dynamics are at play behind the uneven market conditions?

Bené: Consumer confidence plays a big role, and that has ebbed and flowed. Generally speaking, we see probably more of the consistent trend we’ve seen in the last couple of months continuing through OND. I can’t say we’re looking for an explosive end to the year; it’s just too hard to tell month by month what’s going on.

The interesting thing about beverage alcohol is it touches all those different consumer demographics, and so you do see these bright spots where you’re like, wow, it’s okay. On wine products at a certain price point, we’re doing fine. So it is just this dichotomy of what’s happening with the consumer, the traditional high-end consumer versus a more challenged consumer, and I think that’s probably a U.S. phenomenon that’s continuing to happen.

SND: Breakthru is onboarding a host of new suppliers in California as a result of the RNDC exit. Can you talk about the challenges and opportunities presented by this wave of growth, and how you’re scaling the organization to accommodate it?

Bené: I need to start by acknowledging how big a change that was. The impact that had on all their people and everybody out there, that was obviously something that no one could have foreseen. As it relates to what happened after, for Breakthru it has been transformational; we more than doubled our business. A lot of longstanding Breakthru partners who are with us in other parts of the country have now joined us in California.

In the northern part of the state our facilities were set up for success and we’ve been able to easily integrate that business. In the South we did not have the infrastructure, and our people did incredible work to go get a new facility and sign licenses and agreements within about 45 days. We stood up a four-times-larger facility and got it wrapped with product in there and delivering on day one, which was September 2nd. It was a phenomenal effort, bringing in 50-plus new suppliers.

Obviously we’re not perfect yet. We’re navigating some big chain movements that have happened, and we have a lot of new inventory in the building. We’re not operating as efficiently and effectively as we’d like to yet, so there’s more opportunity to improve over the next 30, 60, 90 days. And we’re having those conversations with all of our customers and certainly with our suppliers who’ve joined us. But like I said, just to get to where we are in that very short period of time has been heroic.

We’ll have more with Tom Bené in the second part of this interview.