Seeing a business the size of RNDC start to dismantle itself covertly, market by market, warehouse by warehouse, is almost anticlimactic. Once one of the biggest alcohol distributors in the US, Republic National Distributing Company has filed WARN notices affecting 267 employees at four locations in Washington and another 146 in Oregon, putting over 460 jobs at risk in the region. It is anticipated that the terminations will start on or soon after July 17. The math is easy for workers in Seattle, Everett, Auburn, and Spokane. Before summer ends, the trucks might stop moving.
In a way, the layoffs at RNDC Washington, Oregon, are the inevitable conclusion of a series of negotiations. A non-binding letter of intent to purchase RNDC’s wine and spirits distribution rights in Oregon and Washington, as well as an asset arrangement in Alaska, was signed by Columbia Distributing in April. Although it carefully avoids confirming an exit, RNDC’s own WARN filings state that the company is “exploring various strategic alternatives, including potential sale transactions”—language that suggests momentum toward one. There is a clear disclaimer in the notices themselves: there is no assurance that the new buyer will keep the current staff. More than anything else, employees are currently dealing with this uncertainty.
To see how rapidly this unraveling has accelerated, it is worth taking a step back. Following an 11-market agreement with Reyes Beverage Group, RNDC had already filed conditional WARN notices covering nearly 2,800 employees across several states one month prior to the Pacific Northwest notices dropping. Over 1,200 workers were affected by layoffs in the Grand Prairie and Houston areas of Texas alone. Additionally, the company sold its operations in 17 US control states to Martignetti and agreed to leave Kentucky and Indiana through an agreement with Breakthru Beverage Group. Last summer, California was already gone. This is not restructuring in the traditional sense; the footprint is getting smaller so quickly that it is difficult to ignore a pattern. This appears to be more of a planned withdrawal.
Some observers have been quick to blame Washington’s regulatory environment or overall pressures related to the cost of doing business for the Pacific Northwest exits. When examined closely, that argument doesn’t hold up. At the same time, RNDC is withdrawing from states like Kentucky, Indiana, Texas, and California that have very different business environments. The more convincing explanation, which is frequently brought up in business circles, is structural: American wine consumption is falling, especially among older populations. Younger consumers tend to drink more spirits, seltzers, and non-alcoholic beverages than wine, and the Boomer generation that drove premium wine sales for decades is approaching its seventies. That change has serious repercussions for a distributor that built a large portion of its volume around wine.
Publicly, Columbia Distributing has stated that it “respects the RNDC teammates” and plans to give them priority for upcoming opportunities. From a distance, that kind of statement sounds comforting. The WARN filing itself indicates that no one is yet able to provide an answer to the question of whether it translates into meaningful retention once the transaction formally closes. When its own WARN notices came to light, Reyes Beverage Group used similar language, pointing out that those filings did not represent final staffing plans. Both businesses might be sincere. They may also mean it in the cautious, cautious manner that big businesses often do when a deal is still pending.
Consolidation, category pressure, and the gradual renegotiation of who gets to move product across which territories are all aspects of what is happening to RNDC throughout the Pacific Northwest. The route salespeople who cover the Spokane suburbs, the warehouse employees in Portland, and the workers in Auburn who load cases onto trucks every morning are all essentially bystanders to decisions made at a level far above their pay grade. The notices were submitted. The dates are predetermined. The others are waiting.
