Will Cheek's Last Call Blog
Shot Gun Marriage: Tennessee Department of Revenue Releases Guide for Terminating Your Liquor Wholesaler
Shot gun marriage pretty much sums it up. For distilleries, wineries and breweries, choosing a wholesaler in Tennessee is like marrying your high school sweat heart. She may look great when you are in high school, but as you grow older, you have to ask “Did I find the right partner for life.”
Unlike your high school sweat heart, divorce is not really an option for your Tennessee wholesaler. Tennessee law protects wholesalers and makes terminating the relationship practically impossible.
The Tennessee Department of Revenue recently issued a guideline for terminating a wholesale contract. Download a copy here Guide.
Wholesale termination reminds us of the J. Geils Band tune:
And he loves somebody else you just can’t win
And so it goes till the day you die
This thing they call love it’s gonna make you cry
One thing for sure
In order to start the termination process, a manufacturer has to tell its wholesaler in writing that it wants to terminate the relationship and provide specific reasons why the wholesaler is inadequate. The wholesaler has 30 days to fix the problems.
This is not something any reasonable business person would do. Why tell someone you cannot divorce that you do not like them and tell them why?
We know of no manufacturer that has terminated a wholesaler contract in Tennessee. Although scuffles between manufacturers and wholesalers sometimes result in trading brands, between wholesalers, the brand termination process in Tennessee is heavily weighted in favor of the wholesaler.