Control States and the 3-Tier System
With the end of Prohibition and the passing of the 21st amendments, the three-tier system was developed. The model mandates that manufacturers provide the alcohol to the wholesalers (Tier 1) who distribute product to the retailer (Tier 2) who then sell it to consumers (Tier 3). These tiers are licensed and regulated separately, and no entity can operate under more than one tier. This system helps limit the power of large alcohol companies who may seek to dominate the party and negatively affect the public’s health through aggressive marketing, reduced prices, and the encouragement of excessive consumption.
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National Alcoholic Beverage Control Association. (2015). The Three Tier System: A Modern View. Available online here.