From Family Roots to Retail Shelves: Michigan’s Beer & Wine Wholesalers

You can buy a beverage in seconds, but there’s an entire system working behind that moment and most people never see it. From Traverse City, we sit down with Joanie O’Sullivan-Butler, owner, president, and CEO of John P. O’Sullivan Distributing, and Spencer Nevins, president of the Michigan Beer and Wine Wholesalers Association (MB&WWA) to explain the wholesaler tier that keeps Michigan’s beverage alcohol market running.

We get specific about how distributors operate: building a workforce, managing territory growth, moving into bigger warehouse space, and supporting retailers with the kind of execution shoppers notice most like cold product, rotated inventory, and those big seasonal displays. Joanie also shares what it means to lead a family business at nearly 50 years, and how changing consumer tastes continue to reshape portfolios, from domestic light beer to craft, then seltzers, and now ready-to-drink cocktails (RTDs). We also talk about what’s emerging next: non-alcoholic beverages and functional drinks tied to wellness trends.

Then we zoom out to the laws and structures that shape the entire marketplace. Spencer breaks down Michigan’s three-tier system, why separation between supplier, wholesaler, and retailer supports public health and safety, and how franchise laws and distributor independence help prevent coercion and protect competition. The result for consumers is real choice and a more open path for new products to reach shelves.

If you’ve ever wondered who actually gets products into Michigan, who supports local festivals and charities, or why alcohol regulation works differently than other industries, this conversation is for you.

Links to content mentioned in this episode:

• https://www.instagram.com/osullivandistributing/
• https://www.facebook.com/JPOSullivanInc/

The MLCC On The Road podcast is brought to you by the Michigan Liquor Control Commission (MLCC).  For more information on the MLCC, please visit our website at www.michigan.gov/lcc.  To submit a question or idea for a podcast topic, please email mlccinfo2@michigan.gov.

The mission of the Michigan Liquor Control Commission is to make alcoholic beverages available for consumption while protecting the consumer and the general public through regulation of those involved in the sale and distribution of these alcohol beverage products.

Transcript

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Welcome From Traverse City

David Marvin 0:00

You're listening to the MLCC On the Road podcast, brought to you by the Michigan Liquor Control Commission, with hosts Sarah Weber and David Marvin. Welcome back to the MLCC On The Road podcast. I'm David Marvin, and I have a guest host today, Erica Hoppes. Hello, Erica. How are you doing today?

Erika Hoppes 0:19

Hi, David. I am doing great. Thank you very much.

David Marvin 0:21

And we are at the Michigan Beer and Wine Wholesalers Association in Traverse City today. And we have some special guests that we are going to interview. But before we get started, I want to hand off one of the introductions to Cora Nevins, and she can introduce one of our special guests.

Cora Nevins 0:39

One of our special guests today will be Spencer Nevins, the president of MBWA.

David Marvin 0:46

Spencer, would you introduce our other special guest?

Spencer Nevins 0:48

I'm happy to introduce our other guests. Our other guest today is Joanie O'Sullivan- Butler, who is the owner, president, and CEO of John P. O'Sullivan Distributing in Graham Blanc Township. And I'm also happy to say she's our current chairperson of our board of directors. She's served on our board for 14 years, and we represent 42 distributors and their 5,000 employees across the state of Michigan.

Erika Hoppes 1:14

Thank you for joining us, Spencer.

Joni’s Distribution Footprint And Growth

Erika Hoppes 1:15

And um, Joanie, uh, can you just tell us a little bit about the organizations that you are representing today?

Joanie O'Sullivan-Butler 1:20

Sure. Well, thank you for having me on this podcast. I'm excited to be here. Uh so I'm the president and owner of John P. O'Sullivan Distributing. Uh, we're primarily a Molson Coors distributor, and we cover 11 counties in mid-Michigan, Genesee, Lapeer, Owosso. We go up to Saginaw, Bay City, and Midland, and then we cover the thumb, so Port Huron as well.

David Marvin 1:46

Quite a large, quite a large footprint there. Yes. Now, has it always been that or have you grown over the years?

Joanie O'Sullivan-Butler 1:52

We've grown over the years. So um we started back in 1976. We're actually celebrating our 50th anniversary this year. And when we started, we were two counties, uh, Genesee and Le Pierre, and we pretty much had two brands, Stroh's out of Detroit, and then Miller.

David Marvin 2:09

How many employees do you have right now at uh JPL Sullivan?

Joanie O'Sullivan-Butler 2:13

So we we kind of fluctuate. Right now we're about 140. In the summer, we have more because of uh we have all the college kids come home and help build displays and stack shelves and everything out in the big stores. Um, in the winter, it's closer to 130.

Erika Hoppes 2:28

How has that number grown since like with your growth up to 11 counties? How has that impacted your employment numbers?

Joanie O'Sullivan-Butler 2:34

It's definitely we've grown over the years, not only with the larger territory, but just with the amount of brands and different types of beverages we carry. We've actually moved to a larger warehouse two years ago. We were in the original building my dad built in 1980 in Flint Township. So we had to finally say, okay, we're done here. We're landlocked and we moved. And then when we moved, that also our employee base grew as well because we had more space.

David Marvin 3:02

You mentioned that this is your 50th anniversary. Are there any interesting stories that you can tell about the past 50 years? Anything really cool that's happened, or any really interesting things that you would like people to know about that growth over those years?

Joanie O'Sullivan-Butler 3:16

Right now we're actually have a we're doing like our four first social media campaign and it centers around this 50 stories for 50 years. We've started just putting a lot of our company history on our Instagram and our Facebook. And I mean, one of my favorite stories is that my dad my dad and his partner Mike Sullivan, so it was John O'Sullivan and Mike Sullivan, and we were originally Sullivan and O'Sullivan distributing. They started January 1st, 1976. Pretty much my dad actually worked at Stroh's. He started taking out the tours in college and worked his way up and ended up calling on the Flint distributor, which was Moyer Beverage at the time. They they wanted to get out of the business and they sold to Mike and my dad. And so when they bought the beer distributorship, it was primarily Stroh's, it was the big beer. And then in 1975, that was when Miller Lite was invented. And 1976 it came to the market. So that changed the whole landscape of beer nationally. They really jumped from just a small little two-county distributorship with the popularity of Miller Lite, things really exploded. So it was really just lucky timing. That's always like just a great story to me. They got all of the beer at that time on rail cars and they couldn't unload them fast enough. So they were paying like the demurrage on the fines and everything to get everything you know unloaded. It was just such a crazy time in the beer industry because that really changed everything.

David Marvin 4:45

And you mentioned this social media campaign. Where can people go and find that information to hear these stories that you're going to be telling?

Joanie O'Sullivan-Butler 4:51

We have O'Sullivan Distributing on Instagram, and then we also have our Facebook. So on both of those, we're posting.

Cora Nevins 5:00

Joanie, if I was looking for you on Instagram or Facebook, how would I find you?

Joanie O'Sullivan-Butler 5:06

So on Instagram, we are at O'Sullivan Distributing, and on Facebook, we are at John P. O'Sullivan Distributing.

David Marvin 5:13

And we will put links to both of those in the description of our podcast.

Erika Hoppes 5:17

So, Cora, as a child who, you know, has a parent in the industry, do you have any questions for Joanie? Because at one point Joanie was also a child whose father was very deeply embedded in this industry.

Cora Nevins 5:29

What made you decide to follow his footsteps?

Joanie O'Sullivan-Butler 5:33

It's a good question. So I always grew up in the industry, grew up, you know, working at the warehouse as a kid all the way through high school and then college. And so just kind of always felt that I was going to come back and be part of the business. It was family business. I'm an only child, so it was, you know, kind of all on me. So I always expected to come back and do it. I always thought it was a fun business was coming to these conventions at your age and got to know everybody, and it's been a great

Women’s Leadership In Beer Distribution

Joanie O'Sullivan-Butler 6:04

business.

Erika Hoppes 6:04

So, Joanie, the MLCC has also seen a predominant growth in leadership, you know, as far as women are concerned. How do you feel about the number of women that are now taking on different roles and leadership roles within the beer industry?

Joanie O'Sullivan-Butler 6:18

It's definitely increased and grown since I started in the industry. I remember starting out uh full-time in about 2005, and there were a lot less. There were, I kind of stuck out at some of these uh conventions and different things. But now we have a lot of women in many different roles, even on the supplier side and both on the distributor side. We have two distributorships in Michigan that are owned by women. We have myself and then Kit and Jamie Wanty at O&W. So that's really nice. And we also have even grown as part of Michigan Beer and Wine, we have a women's advocacy committee. We bring all of the women from the MLCC and have an event. And then we also bring in the women in the legislature and just kind of talk to them and show them our headquarters and really inform them about what our industry is all about. So it's been really positive, a lot of positive growth, both on the supplier and distributor end. And then even on the national side, our National Beer Wholesalers Association started out brew for women in the industry, and they've started doing different conferences at both of their national conventions and bring in speakers. And it's open to everyone to come to these conferences, but it kind of has a women-focused group. And I'm on the advocacy board for that. So that's been really fun. I've got gotten to meet other women owners in the industry throughout the country. So this has kind of opened up a lot of doors as far as that.

Erika Hoppes 7:47

It's been really nice. That's awesome. Thank you for paving the way for women.

What MB&WWA Does For Michigan

David Marvin 7:51

Spencer, what is the association's role in the beverage alcohol industry in Michigan?

Spencer Nevins 7:56

We're a trade association. So we represent 42 local family-owned distributors, all located in Michigan. And our role is to really advocate for them and advocate for the industry, to make sure there's laws that recognize the contributions they make to the state of Michigan, make sure there is a business environment in Michigan that's sustainable, that creates competition, also protects public health and safety. So that's that's a lot of our role. So we're in front of the Liquor Control Commission quite a bit. We're obviously in front of the legislature. We get involved in uh in the courts as well. So we're an advocacy organization and we advocate for the industry.

Why The Three-Tier System Exists

David Marvin 8:34

And you touched on the safety aspect, and that was one of the questions I wanted to ask is how do you see Michigan's three-tier system where we have separate suppliers and wholesalers and retailers? How do you see that that benefits the consumers and then also protects the general public here in Michigan?

Spencer Nevins 8:50

So we'll just start, you know, after prohibition and people were looking at how do we avoid some of the problems we had before that? Really, you had basically monopolistic ownership structures where the supplier owned everything and there was a lot of overfocus on consumption. And so the idea coming out was do you create a system and they kind of they came up with two, right? A controlled state system, which we have here where the state sells spirits, or a licensing system called the three-tier system where you have private businesses and they're licensed. And the idea is you separate these tiers so that you can kind of the suppliers can focus on selling to that's the top tier, sell to the distributors or wholesalers, terms interchangeable, that's the middle tier, who then sell to the retailers. And you can separate that retailer from that supplier with an entity that's located in the state of Michigan, that distributor that you can regulate through. The commission can regulate through, check on product, check on records, get excise tax collection. So that's that's the system. But the system has tremendous benefits in terms of controlling consumption. It's it also though creates a ton of competition because that supplier has rules on what it can do with the distributor. Distributor and supplier have rules on what they can do with the retailer and vice versa, which really prevents anyone from controlling somebody else. And without someone controlling, for example, Joanie and her business, she can choose what brands that she wants to bring to market. She can, she has unlimited choice. And a supplier can't prevent her from doing that. And that has created a lot of competition. There's no other industry in the United States. Uh, I challenge you to find one, and you won't, that has more producers making product and competing to get their their product on shelves

Franchise Laws Keep The Market Fair

Spencer Nevins 10:36

every day.

David Marvin 10:36

You mentioned the the competition and suppliers not being able to dictate to wholesalers. That comes under what we refer to colloquially as the franchise laws. How do you see that those franchise laws benefit the consumers also? And how do they actually help businesses like wholesalers, the family business that you're talking about here, to be able to succeed? And is there an impact on what products may or may not be in the industry because of those franchise laws?

Spencer Nevins 11:03

The three-tier system creates independence, right? That's probably the best way to put it between the tiers. The franchise law takes that a step farther to ensure that that distributor is independent from the supplier. So a supplier has to give a distributor an agreement. They have to spell out the core components of how they're going to go to market every day, how they're going to operate. But there's limitations on what they can do. And though so they can't control what brands a distributor carries, they can't control the distributor's employees, they can't force the distributors to take on unordered product. There's a lot of things. We also have the Distributor Independence Act in Michigan that that plays a big role in that. But the best way to demonstrate and how it helps consumers is to tell a story, but I'm going to whitewash names. So large multinational supplier in the 80s is in one of our distributors' warehouses doing a visit, making sure that distributors in compliance and they notice a really nice new brand that many people enjoy today, comes from Canada, and they they mention it, like, oh wow, see you got this brand. And the distributor says, Yeah, you know, it's a good brand. And end of the day, the meetings are all done. They're sitting in the meeting, and that supplier looked at that distributor and said, Let me explain something to you today. By the time I walk out your front door, that stuff better, that that new brand better be poured in the parking lot, or you won't be carrying our brand anymore. And that's the way a lot of industry works. That's the way the soft drink industry works, the peanut butter industry, uh, it doesn't matter, the cereal industry. If you're a distributor, you're at their mercy. That big economic power, right? Whoever's got the economic power. In our industry, that's not, that doesn't happen. So I like to say that our franchise law and our system, we are actually better than the Sherman Antitrust Act. The Sherman Antitrust Act waits until all the harms happened and people are driven out of business. We prevent it all on the front end. We prevent it all. Everyone gets access to the market, which then gives the consumer a lot of choice. I mean, you don't walk into any restaurant and say, when they say, Can I get you something to drink? First question, Coke or Pepsi. You don't ask that. You don't say Miller or Anheuser Busch or you know doggone well. You say, Can I see your menu? Because you know you're about ready to look at a ton of choice. And sometimes you're sitting there and you're staring for a while because there's such a great list of options to choose

Family Balance And Convention Culture

Spencer Nevins 13:14

from.

Cora Nevins 13:14

Spencer, I actually have a question for you. How do you juggle family time with work? Because you work from like eight to six sometimes. I work in an industry where family-owned businesses that's who you deal with every single day. Joanie alluded to it earlier. Her dad started the business and she worked in the business and she came up in the business. And so everyone I work for, they are families, they understand that need to balance uh the job. And yes, you know, in my role, I'm on 24-7, but the members also understand I have to have family time and they're great at making sure I get it just like they've done as well. It's a balance. So, you know, we make it to your volleyball games and your basketball games and everything else you've got going while we still get out to see the kids who are in college, but we also get the work done in and you just have to be, you just sometimes don't work normal hours.

Erika Hoppes 14:06

Yeah. I mean, it is kind of cool though to come to some of these events and see how family-oriented these organizations and these businesses really are. And I think that the fact that we were able to bring Cora in today, it speaks to how embedded family really is in the industry. And I mean, for me, that is just it's such a cool thing.

Spencer Nevins 14:25

What I find interesting as the president of the association, what I learned, and I've been here 20 years now, is the conventions are very important for lots of reasons. One, it brings everyone together and they can talk and talk about best practices, just catch up, not in the competitive environment where they're all competing out in the marketplace. We come together, we have our meetings, it's it's great. But what gets lost, I think, sometimes is the kids who are showing up there today and making friendships, and they don't care if this person's dad is an A B distributor or this person's mom and dad are a Molson Coors, a Miller, whatever. They don't care. They just become friends. And what that means is then when they're adults and they are competitors, they're also friends. And that's, I think, one of the secret successes to our association is people become friends when they're children at these events. And it's really hard when you're a competitor to not also still remember the friendship. And I think it helps us when we come into the boardroom and we're trying to make decisions that are best for everybody. Those friendships prevail oftentimes over the competitiveness.

RTDs And Wellness Drinks Rising

David Marvin 15:24

So, Joanie, what are some of the trends that you're seeing in the industry and and what are you expecting here in the next year, five years, and down the road?

Joanie O'Sullivan-Butler 15:31

The industry has changed so much over the years from just going to more of like domestic light beer, and then you had the big wave of craft beers, and then now it's moved on to um there was the big seltzer craze with white claw and truly, and now the big crays are ready-to-drink beverages, so ready to drink cocktails. And you know, some of these are like that are popular in Michigan, are like Long Drink or Carbliss, Surfside, Cut water. These just I think that consumer tastes have changed over the years, and people want, you know, more sweeter, interesting flavors, and especially like the younger generation that grew up on energy drinks or prime or all of these things, they want flavor to their beverages. So these drinks have really taken off over the years, and I see the those that continuing that trend. And then, you know, more and more beer distributors are also going into like non-alcoholic beverages. We are a prime distributor. We used to carry A lani before it got bought out by Pepsi. We continue to look for what functional beverages are coming into the market. We just picked up one called Recess, which has ashwagandha and uh one can calm you, one can give you energy. And I think that all of these trends, like the wellness trend, is filtering down to beverages. And I think that will continue over the next

Community Impact And The Hidden Work

Joanie O'Sullivan-Butler 16:57

couple of years.

David Marvin 16:57

So, Joanie, you mentioned that you have about 130 employees, and I know statewide, Spencer, you mentioned about 5,000 employees. I think a lot of people, when they think about alcohol products, they think of their favorite brands, and that's more of the supplier tier, and you where you buy them, that's more of the retailer tier. But there's this wholesaler tier, you guys right in the middle, that the average person doesn't, that consumer doesn't know what you guys do and the impact that you have on their communities and with the number of people that you employ and the the different things you do for community involvement. What do you see your impact as a wholesaler is in your community and and statewide, the the association and the members that are involved in all their communities?

Joanie O'Sullivan-Butler 17:40

So definitely I feel that the wholesaler tier and the distributors as a whole are very involved in their local communities. I mean, they're very involved in charities, but also we put on a lot of events. Um, we're participating in festivals. And like, for example, in the Flint area, we sponsor the Crim Festival of Races, which I think they're coming up on their 50th next year. It has a major charitable impact. We're the beer sponsor for that. So we're very involved in local events, church festivals, local concerts. And I know that all of the distributors throughout the state are involved in those types of events. We're all always promoting like our community charitable communities. We're involved not only like with uh those types of like more like statewide events with our local um church festivals or uh other events, uh silent auctions, you know, things like that. I would say that the wholesale tier as a whole is very, very involved in the communities. And then, you know, we're about a mid-sized distributor, so you have other distributors that are employing you know, 500 employees, and that has a huge impact on communities. Many of them put together scholarship funds. I I know there's a wide range of things that other distributors do throughout the state as well.

Spencer Nevins 19:01

This one of the things that's makes it great to represent this industry. Local food pantries. I know when Flint had its water crisis, donating the water, we have distributors in Michigan who have donated to California wildfires. It's really just they step up where their community needs it. Park needs to be rebuilt, distributors rebuild parks all the time. So they're very, very active. They they what does their community need? What does the community next door need? And they help each other out and they help communities. It's it's it's one of the big things. The other area, Dave, where you see distributors every day but you don't know it, first of all, that product gets brought into Michigan. The distributors are responsible for getting it here, putting it in their warehouses, keeping it cold, keeping it temperature controlled, whatever it may be. They're also then responsible for getting it on the vehicles, but they're also responsible for doing the sales, they're responsible for doing the marketing. They build those brands. So when a consumer goes out and they walk into a store and they see point of sale, advertising, that's a distributor. You're seeing a distributor when you see point of sale. You're doing a distributor when you're seeing stock shelves and rotated products. You're seeing a distributor. They do everything from the second it hits Michigan until the second it gets on that retailer shelves. And oftentimes while it's sitting on that retailer shelves, you walk into your local Meijer or Costco, Kroger, whatever it may be, and you see those awesome displays around holidays. Yeah, those are the distributors. That's your distributor at action building all those brands.

Closing And Where To Learn More

David Marvin 20:26

Cora and Joanie and Spencer and my special guest host, Erica, thank you for joining us today on the MLCC On The Road podcast. We hope to talk to you again soon. And for anybody who's listening, we hope that you tune in again to another one of our episodes. Have a good day. The MLCC On The Road podcast is brought to you by the Michigan Liquor Control Commission. For more information on the Michigan Liquor Control Commission, please visit our website at www.michigan.gov/ lcc. Thank you for listening.