Monday, January 7, 2008

Pennsylvanians: Stand Up For Six-Packs

A message to Pennsylvania beer drinkers:

The case law may be in its last months, if your legislator votes for the right bill in the next few weeks. House Bill 606 is making its way to the PA House for a vote, very soon. It's a standard bill about liquor code enforcement, very technical, but an amendment is being attached to it that changes the case law. The changes:

* Before January 1, 2009: Restaurant, deli or tavern may sell one 6-pack, two six-packs, a 12-pack or 3-six packs. A beer distributor may sell any number of six-packs, cases or kegs.

* After January 1, 2009: Restaurant, deli or tavern may sell any configuration up to 18 cans or bottles totaling 288 ounces. Beer distributors may sell any configuration of a 6 pack or greater.

* Permit a holiday package prepared by the manufacturer containing 40 ounces of beer in one or more containers and at least two drinking glasses (mug, stein, etc.) to be sold at beer distributors only.

The key to this is the word six-pack. If you want to break the case law, here's what you want to do. Contact your legislator (the link takes you to a screen where you can type in your ZIP code and get connected to your legislator's e-mail) right now and tell them that you support the amendment to House Bill 606, as written to allow sales of six-packs at beer distributors. Tell them you want six-pack sales; not limited to just 12-pack, 15-pack, or 18-pack sales.

Because that's the tricksy thing: some larger brewers are evidently trying to get the language in the amendment...amended to read "12-pack" instead of "six-pack." Guess which package many craft brewers don't have? Right in one. Your Pennsylvania craft brewers (and Yuengling and Anheuser-Busch, I've been told by people in the legislature and the PA Brewers Guild) want six-packs, and that's what you want to tell your legislator to vote for.

Why is this such a big deal? Pennsylvanians have consistently shown support for an end to the case law (polls show 85+% of Pennsylvanians support being able to buy six-packs at distributors/beer stores); even MADD supports an end to the case law. So why do we still have the case law?

Conservatism, mostly, and I don't mean the political kind. Retailers rarely like to mess with something that's in place, especially in a heavily regulated business like beer sales in the Commonwealth. It's not really fair to them, when you look at it: for over seventy years, the law required them to sell beer by the case, so their stores are set up for that: mostly concrete floors and minimal shelving, room for a pallet-jack, and not much in the way of "pretty." Now, in a matter of months, they're faced with spending a lot of money and labor to make their stores six-pack stores. Makes you think of the old adage: "Be careful what you wish for."

But I'm not talking to you as a friend of retailers, wholesalers, or legislators. I'm talking to you as one of us: Pennsylvania beer-drinkers. The case law is a ridiculous vestige of the early days of Repeal. We are the only state in the Union to have a case law, and it's never done a thing for the good of the consumer (okay, not quite true, but the benefits have all been incidental). This is the best chance we've had in years to kill it. Do your bit to put a stake through the heart of this most asinine of beer laws.


sam k said...

On the surface, this appears to be a no-brainer, but when A-B wants something, anything, my ears start to burn! This is somehow tied, IMHO, to getting supermarket sales into PA, which I'm not quite sure I want. Ever see a great local/craft selection at your average supermarket? Freshness, to me, comes in a sealed, light protected, 24 bottle case (a better deal than four six-packs at most supermarkets) from a fresher source...the distributor, not Kroger. Hmmm, a 40 ounce container with two glasses? When have you seen something like that from Troegs...Victory...Penn? Bet Budweiser has one, or will soon!

I like my local craft distributor, and I'm suspicious that this piece of legislation is the first step to putting him out of business! He does not master any major brands, which puts him at an immediate disadvantage to the other three in town. I'll speak with him tomorrow and see what HE thinks before I contact anyone.

I love ya, Lew, but I'm awfully skeptical of this for the time being.

Lew Bryson said...

You know, Sam, you're experienced, you're savvy, you're prone to think things through from both the consumer and retailer/wholesaler side, but... explain to me what this has to do with supermarket sales. I've heard this from so many retailers, and not one of them has ever given me a good answer, it always devolves into some kind of slippery slope/conspiracy theory rant. You got something better?

This amendment deliberately decouples the case law from everything else: the bill it's attached to is about increasing fines for some liquor code violations. I'm not in favor of supermarket sales either, though selections are getting better in supermarket states as craft beer sales continue to grow. But I'd rather see specialized retailers selling booze (because the damned State Store system has got to go!).

As to the 40 oz. container... that's a minimum, I've been assured by the people in the legislature that are writing the amendment. Your local craft brewer may not have such a package -- yet, but I'll bet they will -- but plenty of Belgian imports do, and I'd like to be able to buy them. Will the big brewers move right in on that? Maybe, and why not? Shouldn't they be able to?

I like the freshness in a sealed case, too. But with price increases coming along that are sending craft cases over $30, over $40, I'd kind of like to see more purchase options than a whole case.

As for local distributors, this is not fair. It's just that simple. The whole damned system is unfair, though. I've dealt with buying cases almost all my life, I've defended it, I've pointed out that we have a great selection of beer despite the case law...but I think it's holding us back.

Bar owners will tell you a smoking ban will put them out of business: that's proven not to be so, except for a few cases on the border. It's differences in regulation that cause the inequity, and in this case, it's hurting Pennsylvania retailers.

Like I said, I'm looking at this one as a consumer. I can't see any good reason to keep the case law.

Lew Bryson said...

Oh, and...I hear you on the A-B thing. But when it's Yuengling and A-B on one side, and MillerCoors on the other? Maybe a different situation?

Andrew said...

Wegmans tends to maintain a pretty good selection of local and craft brew. At least the one in Princeton did. I'm waiting to see how the do in the Cherry Hill one. I think you can get fresh/not fresh beer at a distributor, liquor store, or supermarket, you may be more likely to get it at a supermarket, but that's not to say you will. Again I point out the Wegmans in Princeton that seemed to move quite a lot of craft beer.

bill g said...

Lew, first of all, is there a bone thrown in for the bar owners? I support this regardless, but are they going to fight this tooth and nail?

Secondly, is a 6-pack defined in terms of ounces or bottles? 6 bombers would certainly start getting up there in price, so I'd hope that we're talking a volume definition.

Lew Bryson said...

Only bone thrown is that taverns/delis/etc. may now sell three sixers at a time, one more than the previous two-sixer limit. And there WAS talk of a volume definition for a sixer of 66 oz (to cover 375 ml/11.2 oz. bottles), but that's apparently been discarded in favor of a six-pack being defined as a package of six bottles. Yeah, that could mean six bombers, but...when they already come in cases of 12, why bother?

Lew Bryson said...

The question is not whether there are supermarkets that maintain a good selection of craft beer in good condition, or at least, it shouldn't be: there are. The question is what would happen everywhere else. I mean, I live in a fairly affluent Philly suburb. People like craft beer here. But the nearest Wegman's-level supermarket is half an hour away, with many supers closer. I'm not optimistic about the offerings of beer we'd get at my local supers if PA suddenly allowed it; the cheese selection, for instance, is pathetic and all pre-wrapped in stretch-wrap. doesn't bode well.

I've seen good beer selection in supermarkets, I've seen crap selections. Beer stores tend to do better...but not always. It's not black and white.

Andrew said...

Oh I understand that supermarkets are not going to be a first choice, and that a beer store will carry a better selection. I guess I just saw where sam k asked about seeing a great selection at a supermarket and answered that question. You're probably right, and most supermarkets wouldn't be carrying a worthwhile selection. I guess I'm just saying that having supermarkets with beer isn't a huge deal, and that they don't all have to be bad.

Lew Bryson said...

You get the beer culture you deserve, I guess. Places that want and support a better selection will probably get it. And grocers are becoming more aware that if they stock a broader selection, they'll sell more.

What retailers have to balance is the number of wholesalers they deal with vs. what they can get. Dealing with more wholesalers costs money: more paperwork, more time, more hassle. Dealing with fewer -- or one -- wholesaler saves time and money, but may cost you in terms of the beers you can offer. Factor in your neighborhood, your aims, your price structure, and make a decision. Won't necessarily be the decision a beer geek like me would make or like, but I've seen plenty of beer specialty stores make the same kind of decision. It's a gray area, it goes more than one way.

David said...

Some part of me wonders if our beer selection in PA is so good because of the case law. While yes it may be harder to sell a case you are only selling one unit as opposed to 4. Once that unit is sold the distributor knows they need to buy more as opposed to selling 1 six pack and knowing there are still 3 units left to be sold. Its just something I have been thinking about since the new six pack discussion has come up. Are there any concrete sales figures about how beer sells in PA as opposed to other states? And in the end there is no way to know until the 6 pack laws pass and we see any change in our beer landscape.

I do welcome the change, I just worry it may hurt our beer choices in PA. There is a lot of craft beer out there that comes in 4 packs or larger bottles such as 22oz or 750ml. These laws really don't take those into account. Are we going to see bomber 6 packs of Arrogant Bastard, or any of the smaller Russian River bottles?

This new law does help the average beer drinker a great deal but us craft beer drinkers are still left out in the cold with a lot of the beer we drink from time to time that I just can't see being packaged in 6 packs. Those singles/6 pack stores that are already in place will be in a better place to cater to us craft beer drinkers, though they will loose a lot of business to the distributors in their local area.

Lew Bryson said...

Thoughtful comments. It's interesting you mention about selling a whole case making things easier for retailers to keep track and order beer: that's exactly why we have the case law. The beer business wrote the law and handed it to the PA legislature, who enacted it essentially intact. The case law was intended to make things easier for the retailer and wholesaler, not the consumer.

Will it make things better? Will it make things worse? Hard to say. If you want to buy a single 22 oz. bottle, you'll still have to go to a bottle shop, and as we all know, there aren't as many of them as we'd like. Will the bottleshops be able to survive the competition for their sixpack sales? Again, I don't know.

I also think that presenting the change as putting craft beer drinkers "out in the cold" is a bit much. Sure, there are lots of craft beers that come in big bottles -- and not in "holiday gift packs" with glassware. But there are a LOT of craft beers that come in six-packs.

And something else. The way PA law is currently written, it is strictly illegal for either the consumer or the retailer to break up a case to make a "mix-n-match" variety case -- although some retailers still do just that, and I've never heard of anyone being fined for it. The new proposal is silent on that aspect. You'll note that what it says is "Beer distributors may sell any configuration of a 6 pack or greater." Nothing about "prepared by the manufacturer", as you see in the holiday package provision. I take that to mean a "sixpack" is "any configuration" of six bottles. Any six bottles. There's nothing in the law preventing I see it.

David said...

Lew yes, the "out in the cold" statement may be a bit bold. I just think we are starting to see a lot of beers come in the bigger bottle variety as opposed to normal 12oz bottles. Just would be nice if there was a distinction of the number of ozs these beers must be as well. I do agree there are plenty of fine beers that will come packaged in 6 packs. You do make a very interesting point about the possibility of stores being able to package their own 6 packs. Lets just hope distributors will want to do that as well. They may not because then you are talking about 24 units to sell as opposed to 4.

Either way this new law does help beer drinkers try a wider variety of beer without having to travel out of state. What remains to be seen is if this will hurt our variety or we will even see any price break compared to buying at one of the existing single/6 pack shops. I doubt we will see the answer to these questions right away either.

chapka said...

I've contacted my state rep by phone and email. A tip: legislators care about email, but they generally pay more attention to phone calls and physical letters.

And anyone who is worried about supermarket sales, just go to a supermarket in one of the states that do allow beer sales.

When I lived in New York, my local Key Foods carried Rogue, Stone, Avery, Smuttynose, North Coast, Dogfish Head, Brooklyn Brewery, plus plenty of British and Belgian beers. This was just down the street from the best specialty beer store on the East Coast, Bierkraft in Park Slope.

When I lived in California, I could get plenty of good beer at Whole Foods--and that's in a state where they faced competition from alcohol superstores and local liquor stores.

I live close to two Whole Foods and a Food Source. These are the kind of stores that sell good beer in other states; I don't see them stocking up on Natty Light in Pennsylvania.

Lew Bryson said...

This is going to take a while to sort out as distributors (that's "retailers" in PA-speak, to you out-of-staters who might be confused) decide what they're going to do. I suspect what you'll see is a lot of stores having a "six-pack rack" for craft beers and their most popular beers, but still a lot of cases, and you'll see a discount on the cases to encourage you to buy the whole case...which is as it should be.

But I'm not really in favor of setting ounce-limits on what is or is not a six-pack. I'd rather leave it wide open. Six-pack of 750 ml bottles? Go for it. Cheaper than a case of 12, eh?

Anonymous said...

99% of all alcohol regulation is mired in the dark days of post-prohibition. This may bring PA closer to the 21st century, but the real legislation I want is none at all. There should be no legal limitations on how a retailer sells their product; Pennsylvania doesn't force the consumer to purchase wine by the case, or in any minimum quantity for that matter, so why beer? And why stop there? Maybe there should be a law that forces WalMart to sell shoelaces in packs of 6, no less. Would anyone think that makes any sense?

Anyone who is authorized to sell beer should be allowed to sell the beer in whatever quantity they choose, from single bottles to full cases. The state has no business being involved; let the market decide what works and what doesn't, and where.

If a certain shop chooses not to carry single bottles of craft beer, but has the best prices on cases of Bud, then they'll get that segment of the market. Another shop can specialize in selling single bottles of hard-to-find brands, and they'll naturally get that segment.

Government is best that governs least. Wiser words were never spoken.

Brad said...

Hi Lew. Just found the blog -- good stuff.

Anonymous said it perfectly. It never ceases to gall me how little common sense seems to be employed in the formulation of our alcohol laws.

I would defy anyone to identify the real, measurable danger in allowing sales of one bomber or a four pack or a 750 of some beer.

Why did the proposed law change stop at six packs? In a truly open and transparent democracy, you would be able to identify those who want to keep options like singles out of your state, and challenge them on their position.

Lew Bryson said...

So much of the regulation on booze stems from nanny-staters and moralists that we assume that's the root of all idiocy. It's not, in this case: no one thinks selling one bomber or 4-pack is "dangerous." But there are people who think it would be bad for business, and they're people you probably don't want to harm.

They're the owners of your local distributor. They've worked hard to run their business by Pennsylvania's peculiar laws and deliver good beer to least, most of them have.

And now they're concerned that this new law is going to pull the rug out from under them. "No one likes change," said one distributor to me just tonight about this. "I've got to change my whole store to accommodate this." He'll do it, but it's going to cost him some serious money, and change his whole business: he'll have to change his computerized register, he'll have to change how he orders beer, and maybe he won't be able to carry as many beers now.

Do I still want six-packs? You bet I do. Is it going to be all wonderful, all good, all 100% positive for everyone? No. Businesses will lose money, some may go under. That's change. Some businesses go under anyway, to be fair: happens all the time.

PNeifert said...

Anonymous, nobody is forcing you to buy in any quantity - you just need to go to the right place. You wouldn't buy a carton of cigarettes one at a time out of a machine for $7 apiece - you would (hopefully) find a more economical alternative. That's exactly how the beer system is set up.

Anonymous said...

Just today one of the true gentlemen in the beer business sold his wholesale business in chester county to the wolf at the door in phila...think you may not have a choice to the type of beer and selection and reasonable price just wait till the wolf buys up every option a distributor has to purchase beer from the wolf will control pricing the selection the delivery time and day to fit his appetite and god forbid their might be a mistake on an invoice or discount guess who will win this not fear the six pack laws fear the wolf

Lew Bryson said...

Sounds like someone's got a beef with Origlio...

Full disclosure (not that most people in the biz in the area don't already know it): I do freelance writing work for Origlio, stuff in their newsletter. It's no secret, I sign the stuff. But I won't defend them: I can't, because I don't know what it is they're accused of. I can't tell you what they will do; I don't know.

What I can tell you is that the only difference between what's happening with beer distribution in Pennsylvania and almost everywhere else is that we're just behind the curve (I say "almost" because consolidation in a couple small states is about where we are). Not saying it's a good thing or a bad thing, but wholesaler consolidation is a fact across the country, it is the major thing that's going on in the beer biz, bigger than craft, bigger than the MillerCoors shuffle. Origlio buying Spaz is just one tiny little step in the parade.

Like I said: not saying it's good or bad, at least not here and now. Like the case law, there's good and bad to it. But it's hardly unique.

Now...I've done full disclosure. Are you still going to go with "Anonymous" and not say who it is you're scared of, and why?

Anonymous said...

sometimes what we perceive and what we tend to be scared of is reality..what is very sad is two well liked and respected gentlemen in the beer business skip kunda and charlie spaz left there business and employees go as you said they saw the writing on the wall no pund intended..consoldation leaves people who really care about this buiness on the side lines wondering what happended and the greedy breweries and distributors to control what we will drink and what you will pay for it not to mention the complete utter distain for the small craf beers that are at the mercy of the wholesaler CRY WOLF OR EGO DRIVEN NARCISTIC MONEY GRUBER WHO GIVES A PASSING INSTREST WHEN THE PRICE BECOMES TO HIGH AND THE BRAND DIES A PAINFUL DEATH scared we will have a choice between bud coors and lite..

Lew Bryson said...

I don't understand...well, a lot of what you wrote, but one thing leaps out: if the big brewers and wholesalers are just money-grubbers, why would they dump a small brand when the price went up? If people still buy it, don't they actually make more money? And if people don't still buy it...wasn't it the brewer who raised the price first (for whatever reasons; probably reasonable ones, from what I've seen)? I don't follow your reasoning here.

Anonymous said...

The reason for the comments made are simple and in favor of the wolf who will make the same amount of money with a huge price increase when the craft brewer will sell less cases at the new price what a great way to build a brand buy selling more cases more sampling but no wholesaler instad of selling 5000 cases of saranac they will sell 250 and make the same amount of profit and not have to work as hard,screw the little guy who has been pounding the pavement with a sample and story to tell building one case at a time why not invest 50/50 and build it like the boys at land m wholesalers did with yuengling no to hard lets just buy everything in sight and throw alot of shit against the wall and hope it sticks...