> Step 2: Give it away for free in order to put the dealers out of business?
Why do you need to give it away for free?
You just need to make it so that normal businesses with normal procedures produce the supply and distribute it.
Compare bathtub gin to any modern factory made liquor.
Normal companies can produce the stuff, and normal companies can distribute it. Walmart and co are enormously efficient at the latter, and still provide clean and safe products. No need to give anything away for free, you just need to make it legal for normal, formal companies to compete.