Understanding Post-Offs and Price Promotions

What a post-off is

A post-off is not a discount. It is a funded price reduction that you control, budget for, and use strategically.

A post-off is a temporary reduction in the price a distributor charges retailers, funded by the supplier. The name comes from the idea of posting a lower price for a defined period. During the post-off window, the distributor sells your product to retailers at a reduced price: typically $1 to $3 per bottle lower than the standard price: and you reimburse the distributor for that reduction on a per-case basis after the fact.

The mechanism is straightforward. Your standard FOB generates a standard distributor selling price. When you run a post-off, you authorize the distributor to sell at a reduced DSP for a specific time period, usually two to four weeks. The distributor passes that lower price to retailers, retailers may or may not pass it to consumers depending on their margin position, and you pay the distributor a per-case credit equal to the price reduction multiplied by the cases sold during the period.

Post-offs are one of the primary tools suppliers use to drive incremental placement and velocity at retail. Retailers respond to price because lower prices mean higher consumer demand and faster turns. A new brand running a post-off can often get into accounts that would not take it at full price, and can drive the kind of initial velocity that triggers reorders even after the promotion ends.

The critical distinction is that a post-off is a planned, funded, time-limited price reduction: not a permanent price change. You are not lowering your FOB or changing your long-term pricing. You are investing marketing dollars in a specific window of promotional activity. That investment needs to be budgeted for before you launch, not improvised after you discover your brand is not moving.

The core mechanic

You authorize the distributor to sell at a lower price for a defined period. The distributor passes the lower price to retailers. You pay the distributor the difference per case sold during the promotion. The retailer gets a deal. The consumer may see a lower shelf price. You pay for it all.

How post-offs work in practice

The mechanics of a post-off involve your distributor, your retailer, and your promotional calendar. Here is how to execute one correctly.

Running a post-off starts with your promotional calendar. You decide which months or windows you want to run promotions, what the discount depth will be, which accounts or channels the promotion applies to, and what your total budget for promotional funding is for the period. That calendar then gets communicated to your distributor with enough lead time for them to plan their sales activity around it.

Typical post-off depths in the spirits category run $1 to $3 per bottle, or $12 to $36 per case of twelve. A $2 per bottle post-off on a $29.99 product brings the consumer shelf price down to roughly $27.99 if the retailer passes the full reduction through, which many do. That $2 shelf price reduction can meaningfully impact consumer trial, particularly for an unfamiliar brand competing on a crowded shelf.

Post-offs can be structured as open post-offs, which apply to all accounts in a distributor's territory, or as targeted post-offs that apply only to specific account types or channels. A new brand might run a targeted post-off for off-premise accounts only, or limit the promotion to independent liquor stores while excluding chains that have their own pricing programs.

After the promotion period ends, the distributor submits a claim showing the cases sold at the reduced price during the window. You review the claim, verify the depletion data, and issue a credit or payment for the funded amount. That settlement process is where errors and disputes most commonly occur, which is why having clear written terms for every post-off before it runs is essential.

What i tell every founder

Build your promotional calendar before you launch, not after. Retailers and distributors plan around promotional windows months in advance. If you show up without a promotional plan, you are at a structural disadvantage versus brands that come to every meeting with a funded calendar already in hand.

When to use price promotions

Promotions are a tool, not a strategy. Use them at the right moments for the right reasons.

The right time to run a post-off is when you have a specific objective that a price reduction will help achieve. Getting into a new account that has been resistant at full price. Driving velocity at an account where your product is placed but not moving. Supporting a chain authorization that requires a promotional commitment. Competing during a high-traffic selling season when your category is heavily promoted. These are all legitimate uses of promotional funding.

The wrong time to run a post-off is when you are using it as a substitute for brand building. If your product is not moving because consumers do not know what it is or why they should choose it, a price reduction will generate a short-term sales spike that evaporates the moment the promotion ends. You will have spent the money and moved no closer to building a sustainable brand.

Promotional cadence matters as much as promotional depth. A brand that is always on promotion trains consumers and retailers to wait for the deal. If your standard price is $29.99 and you run a $24.99 promotion four times a year, consumers will buy during promotions and wait the rest of the time. Your effective price becomes $24.99 even though your SRP says $29.99. Be disciplined about how often you promote and protect the integrity of your base price.

Launch promotions a post-off during your first 60 to 90 days in a new market can accelerate initial placement and trial. Budget for it as a cost of market entry.

Seasonal promotions key selling seasons like summer for RTDs, holiday for spirits, and spring for wine are appropriate times to invest in promotional pricing.

Chain authorization support many chain buyers require a promotional commitment as part of the authorization agreement. Budget for this before you approach chains.

Velocity support if a specific account has your product but is not reordering, a targeted promotion can reset the velocity and justify a reorder.

Budgeting for promotions

Promotional funding is a line item in your financial model, not a surprise expense. Build it in before you launch.

The single biggest mistake founders make with promotions is not budgeting for them before launch. They set their FOB price, calculate their margin, and then discover mid-year that running even modest promotional activity means operating at a loss. Promotional funding needs to be modeled as a cost of sales from day one, just like your depletion allowance and freight contribution.

A reasonable promotional budget for a new spirits brand in its first year is $0.30 to $0.60 per bottle, or roughly $3.60 to $7.20 per case. That budget covers two to four promotional windows per year at moderate depth. If you need to run deeper promotions to compete in your category, your budget needs to reflect that reality before you set your FOB price.

The way to build promotional funding into your model is to treat it as a variable cost per case sold, similar to your depletion allowance. Run the full waterfall with the promotional allocation included and make sure your contribution margin is still viable after accounting for all promotional costs. If it is not, your base FOB price is too low or your cost of goods is too high, and you need to address that before you launch.

As your brand grows and your distributor relationships strengthen, your promotional strategy will evolve. In year one, you are primarily using promotions to get in the door and build initial velocity. In year two and three, you are using them strategically to defend shelf space, compete during key seasons, and support expansion into new markets and accounts. The brand that manages its promotional spending with discipline in year one is the brand that has the margin to invest more aggressively in years two and three.

The bottom line

Post-offs and price promotions are one of the most effective tools you have for driving placement and velocity in the off-premise channel. Use them intentionally, budget for them before you launch, protect the integrity of your base price, and always tie promotional spending to a specific objective you can measure.

Want a promotional calendar template for your brand?

The Price Promotion Calendar Template gives you a structured framework for planning your annual promotional windows, calculating per-case funding costs, and tracking promotional ROI against placement and velocity goals.