NOTE: VIDEO AT THE END OF ARTICLE
The Republic National Distributing Company (RNDC), America’s second-largest alcohol distributor, is pulling out of California, citing rising operational costs and a changing business landscape. The company will cease all operations in the state effective September 2, 2025 — a move that has sent shockwaves across the wine and spirits industry.
Headquartered in Texas, RNDC says its decision is based on a combination of economic pressures, supplier shifts, and regulatory burdens. CEO Bob Hendrickson described California as “unsustainable,” stating the company will now refocus its efforts on more favorable markets like Texas and Kentucky.
“This transition allows us to double down on the regions where we see the most growth potential,” Hendrickson said in a public statement.
RNDC’s sudden exit has left more than 2,500 beverage brands scrambling to find new distribution channels in what is traditionally the country’s largest wine market. Many top-selling brands, including Tito’s Vodka, Jack Daniel’s, and High Noon, had already cut ties with RNDC in California, reportedly switching to competitors like Reyes Beverage Group.
Industry insiders suggest that internal mismanagement may have worsened the situation. Former employees claim the company’s leadership failed to adapt to California’s unique market dynamics, with one alleging that RNDC “focused more on spreadsheets than service.”
Despite earning an estimated $2.8 billion in California revenue in 2022, RNDC’s relationship with major suppliers began to fracture after its acquisition of Young’s Market Co. Internal shakeups and increasing regulatory hurdles only added fuel to the fire.
California’s business climate has long been a point of frustration for large corporations. High taxes, steep labor costs, and complex licensing requirements are often cited as reasons companies leave. The state’s $16.50 minimum wage and extensive permitting processes have drawn sharp criticism from business leaders.
For California wineries and beverage producers, the timing couldn’t be worse. John Buehler of Buehler Vineyards said the sudden departure “left everybody in the lurch,” and that 80% of their revenue depends on wholesale distribution.
Meanwhile, RNDC is investing heavily in its Texas operations, with plans to create 100 new jobs and deepen its market presence there.
The company’s move underscores the growing tension between California’s business policies and the economic realities facing national distributors. Thousands of beverage brands must now adapt — and quickly.
https://www.youtube.com/watch?v=Nf6PAsMvZoY
