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Consolidation Looms Large In Middle Tier, But RNDC Builds Toward $7B On Its Own

November 2, 2015

While the Charmer Sunbelt-Wirtz and Southern-Glazer’s alliances have been the talk of the spirits and wine industry in recent days, the country’s second-largest spirits and wine distributor continues to quietly advance toward the $7 billion mark.

Republic National Distributing Co. (RNDC), which ranked behind only Southern Wine & Spirits among the leading U.S. spirits and wine distributors in 2014 with roughly $6.1 billion in revenue, according to Impact’s exclusive report, is enjoying impressive growth this year.

RNDC president Tom Cole tells SND that the distributor should finish 2015 with revenue in excess of $6.75 billion, resulting in double-digit growth over the previous year. The increase includes a mix of organic progress and new business, led by the addition of the Banfi/Excelsior portfolio in five markets and Texas’s St. Genevieve in three markets. The former brought in roughly 1 million cases of incremental business, while the latter added another 250,000 cases.

Still, Cole thinks the new unions between Charmer and Wirtz and Southern and Glazer’s will make the business even more competitive—especially in the national accounts channel. “We’ve generally been regarded as the category leader in national accounts, but there’s an opportunity for these newly formed players to do well there. So the key challenge for us is continuing to add value in the channel.”

Cole is less concerned about supplier shifts from RNDC to the newly formed alliances, due to exclusive long-term pacts the wholesaler has with its key supplier partners in a wide array of markets.

The RNDC president also believes there may be more moves to come in the middle tier—and his company may play a role in such activity. “Will the recent events trigger other moves? I think they likely will,” says Cole. “We have a great appetite for continued growth. We continue to look at the Northeast and other parts of the country, including markets like Wisconsin, which we’d entertomorrow if we found the right partner.”

“While change is a constant in this business, 20 years from now, RNDC will still be around,” Cole adds. “We’ll be different—we’ll be bigger—but we’ll still be here.”

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