Tuesday, March 2, 2010
Beer in grocery stores: PA debate on WITF-FM
There was a good discussion of the current proposal to allow beer sales in grocery/convenience stores today on WITF-FM's SmartTalk business program. I hope the recording is going to be up soon; meantime, there's a poll up you might want to vote on. I know I did. The poll is here; I hope the file for the show will be there soon. I may be on the radio about this issue real soon; I'll let you know when that happens.
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27 comments:
Crikey Lew, in the land of the free you can't by grog in a supermarket?
Can you believe it? What's more, can you believe that the guy representing the beer-only stores we have now actually used the argument that beer was dangerous to the public welfare, and the number of stores should be strictly limited? Tomorrow: he shoots himself in the other foot.
That Obama fella looks like a regular guy that likes a beer. Not retarded like that last fella you had. Can’t he do something for his beer loving countrymen?
Ah, well, no. It's this federal system we have. Every state has the constitutional right to set their own liquor/beer laws, and my state, Pennsylvania, has some of the most restrictive...and yet at the same time, it's really worked well for our in-state breweries. Funny.
How does the exsisting st up help local brewers ? nt a debate just curious
Well...it tends to keep things split up. While there is consolidation going on among wholesalers now, for years and years, there was a diverse bunch of people/companies wholesaling and selling beer, and no one was allowed to own more than one license. That means it's hard for the big breweries to build up a dominating presence. Pennsylvania had (and still has) the most pre-Prohibition breweries of any state, and that's the likeliest reason...but no one's really sure. Bill Covaleski at Victory thinks it has to do with the character of Pennsylvanians as much as the laws. We're skeptical, we're hard to win over, but once you do, we're loyal, and that's working for the new craft brewers as well.
It's all kind of soft-edged, really. I see the laws, I see the results, but I'm not sure where the cause and effect is, to tell the truth. Wonder what the ghosts have to say?
so is it fair to say one the possible outcomes of this liberalizaiton would be the ability for wholesalers to consolidate by buying up licenses, those wholesalers being tied to specific breweries thus there will be a less and less diverse group of wholesalers representing fewer brands ?
No, I don't think so. Wholesaler consolidation is happening already in other states (quicker than in PA, though we're catching up), but wholesalers can't "buy licenses." That's the three-tier system. A wholesaler can have one license (and I believe they have to be separate businesses; like you own the wholesaler, and your wife owns the company that owns the retail outlet), that's all; at least, that's the way it is in PA. That's one of the things that is unfair about this current proposal; grocery store companies can own multiple retail licenses, distributors can only own one. That's not right.
And in other states where wholesalers have dumped brands (you did say "fewer and fewer brands" available to consumers, meaning the wholesalers have stopped carrying them), new small wholesalers spring up to service those brands, much like Stockertown and Bella Vista have in eastern PA.
interesting, so if what you are saying is correct, demand will drive the process from the bottom up rather than the top down. I think that is right as long as the processs is liberalized entirely, that is, it becomes easier to obtain a license. One of the propblem with the current system cartel like practice or limiting and controlling who may obtain a licsnse at any level of the 3 tier system
Indeed. I'd like to see the licensing system completely overhauled; it's broken to the point where it can't be fixed. Easy for me to say, since I don't have $250k sunk into a license, but I think it's having a significantly deleterious effect on the commonwealth.
what about elimintaing a level all together by buying direct could that ever happen? I magine the breweies like it the way it is, but it seems to be starting to gain momentum in other areas of retail
Don't count on that happening any time soon, jp: that's written into law. The funny thing is...small brewers and winemakers can sell direct, which would seem to be unfair competition, particularly in light of Granholm (a different situation, but the basic premise is sound). Dunno. There is much about alcohol law that just doesn't make sense; the case law, for instance.
Not sure what your definition of small is Lew but I remember buying directly from Stoneys (cases and kegs) and the Lion (kegs) in the 90's certainly not small compared to the microbreweries but small compared to the nationals and regionals of the 50's and onward.
I always heard you couldn't buy from the breweries but bingo I did.
Depends on the brewery, jb. All the breweries in PA have the option of selling direct ("small" in comparison to nationals); not all of them exercise it. Straub still has a store too; Yuengling doesn't, Iron City didn't, Latrobe didn't.
Good day. I have always looked with great admiration upon my brewing brethren in your wonderful Commonwealth and I would agree that your tiered, albeit unconventional, system of sales has maintained such strong brewing history and heritage for your commonwealth.
Whereas this sort of sales unorthodoxy does not exist to the same extent in my state, my own legacy, and those of many of my fellow barons, was greatly shortened, thus diminishing the enjoyment of our favorite beverage by my fellow residents of the 32nd state to your north and west as we succumbed to the national brewing powers.
Of course Mr. Bryson you are quite erudite in your acknowledgement that cause-and-effect cannot be wholly proven in this case, and although our current state of "existence" extends to us more definitive answers than you mere mortals, we are not at liberty to elucidate that which you cannot prove yourself. You may however, sir, read between the lines as you are on the right path! Fare the well.
you can walk into East end here and buy beer
thanks. The stoney's guys said they sold theirs for a buck more a case, so as to not upset their retailers. At the lion I used to buy kegs only, but they have (unfortunately) stopped selling kegs since.
Wonder if Bub's had a store?
It's up now...I'm listening. Thanks for the tip, Lew.
Boy, the guy from the malt beverage distributors assoc is really using some weak arguments to basically say...we want to keep our business model the same. In my view, if the law changes, and the distros don't change their business model to keep up, then they lose their business...they gotta change. The whole thing about more retailers causes more drinking problems is completely BUNK.
From the show comments: "I keep hearing Mr. David Shipula talk about the problems associated with alcohol. Maybe he should stop selling it." Classic! It's just like Lew's old two face argument about the PLCB...love it.
Those guys keep harping about liberalized retailers causing more drinking problems because it is all have got. Never mind that is it completely bunk and disproven. I mean what else are they going to say? "Ah we want to keep the system the way it is because it takes more money out of your pocket and puts it in ours and we like that" These dinosaurs have nothing close to a reasonable argument except that they have a great gravy train going and would like to keep it as long as possible. The fact that they are trying to fight this with that beat down control state argument shows how desperate they are. they will team up with the AFSME or whatever union runs PLCB retail (as those guys see the writing on the wall ) and maybe the middle state bible thumpers, those are there usually allies in this epic struggle but I think the worm has finally turned
Not quite fair, Al. Yes, I think those arguments are silly at best, and self-damaging at worst. But the argument that they have played by the rules -- they have -- and now they stand to lose a lot of money and maybe their business with the stroke of a pen is a solid one. There must be a way to make this more fair -- and I'm not talking about leaving it the way it is, OR about a big payout to the distributors. But they should at least get the same opportunities the grocers have: multiple licenses, freedom to sell what they want, and so on. Some of these distributors bent over backwards to get us the craft beers we wanted; tossing them to the wolves at the first opportunity isn't even pretty, let alone right.
No argument about allowing multiple licenses or selling what they want that is what this reform is all about. If the argument that they have played by the rules and have a right to be "compensated", is solid they will bring a suit for breech of contract in court. Otherwise it is meaninless and can be summed up as assumption of business risk. I guess we will see what they do.
there are some really ridiculous sentiments in the comments written there, hahaha. Like going grocery shopping at 11pm ruins family values..and don't we all remember when doctors made housecalls, and families ate dinner together...
Who falls for this bullshit?
Boy, that comment section at the WITF site is an ugly battleground. I think the voting has been "stuffed" somehow. There are a suspicious number of people who seem to care deeply and personally about the fate of distributors, and quite a few "think of the children" types as well.
I had to bite my tongue and refrain from angrily joining the argument.
Matt, I had the same thought as you...someone was rigging the votes, but then I was voting my share too. The ones that are closest to the issue stand to lose the most.
When the poll voting had first started, I remember it was running about 80% in favor of selling beer in grocery stores, when I think there were about 70 votes in. Clearly, things shifted...
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