I was in the liquor store yesterday purchasing my Piedmont wine for WBW #54 which the topic is "A passion for Piedmont." and I noticed a petition against the proposal for wine sales in grocery stores. (WBW will be held February 18 - so no sneak peeking yet to my choice.)
In New York, the Governor is proposing legalizing wine sales in grocery stores. This is part of his new balanced budget. What does this mean. A few thing and you can look at it a few different ways.
What it means for the liquor store - less traffic as more people will be purchasing their wine with their daily trip to the grocery store. Since grocery stores are chains, their purchasing power will be greater, hence they will sell wine at a cheaper price. BUT...for those seeking a wine that is exclusive, higher quality or library wine, they will have to go to the liquor or wine store, as the grocery store won't have that type of selection. I also question the knowledge base of the clerk at the grocery store vs the liquor store.
What it means for the local wineries - Two things. If the local winery is proactive in its sales it can be tremendous. They will have new outlets to sell their wine over a greater geographic area. However the flip side is some of the small wineries can't compete with the grocery stores and it will be more difficult for them to get their product into a store like Price Chopper or Shoprite where they buyer is miles away. Having relationships with the local liquor / wine stores is how many of the small wineries get their product out, and if this law gets passed, it might force the small wine stores to close their doors. In doing so the small local winery will lose their outlet to sell their wines locally.
Local wineries can sit back and sulk and fight or they can move before their cheese does, be creative and work together to gain more exposure in a larger market.
6 comments:
Good observations! Seems we are always saving New York State at the expense of small businesses.
a few points;
if the big chain grocery stores (and lets face it, what other kind exist now? they are all SuperMarkets) begin to sell wine, the liquer stores will only be able to cater to the specialty crowd for so long. as they fall back on their hard liquer sales, their ability to stock the vast number of higher end wines available will decrease, as will their ability to pay for the retail space to do it. Very few liquer stores are going to make a Wine Library-like transistion, because, lets face it, how many Gary Veynerchucks are out there? They will constantly be giving you the same line; "I dont have that, but I can order it for you." Just like the record store, or the hardware store ect ect ect. the problem is, in 2009, if you can order it, I probably can too.
The supermarket will ignore local wines for the same reasons that local liquer stores ignore local wine; economically there is always a better deal. Although, were this measure passed, they may take a different attitude to local wine, since, as a matter of policy, the superstores would not be competing in that market.
I agree that having a good relationship with the liquer store is key to getting local wines sold. But on the supermarket level it wont matter if the manager is a winery owner, because they almost always are not in direct control of the good shipped to their store. A truck comes once a week, pallets are unloaded, and the store "associates" just break it down and put it out there, unsold stuff just piles up till it goes on sale. it dosnt matter that, just for example, that strawberry jam sells out with in 3 days, and it take all 2 weeks to sell all the grape. when the shipment comes, it will always be equal portions strawberry and grape. same thing for local wine, the demand wont matter if corporate HQ needs to sell the cargo container of yellow tail they got sitting around gettin hot.
ps. do you have any info on the HVWGA Amature wine contest? not the one for real wineries, the home wine makers competition.
Rowland: You can download the forms at http://www.scribd.com/doc/11941063/Non-Commercial-Forms-09
Debbie, great blog... just found it recently.
In regards to this topic, small wineries don't make much money to begin with when selling to liquor stores. In fact, I would argue that any small winery (definition needed) who basis their business plan on a high percentage of sales via the liquor store channel, will have an extremely difficult time succeeding in today's wine world. So... I'm not sure that this really matters for the small winery. In fact, it may help because what the small winery can provide is exactly what the big chains cannot, personal, direct and quality interaction with the customer (something that by the way many liquor stores are terrible at too). The wine world is changing rapidly. People already know that good wine is being made all over the world. So, I believe that more and more people no longer just go out looking for a good wine. It's a given that the wine will be of at least reasonable quality. They are starting to look more and more for wines with a story. Can the liquor store and big chains deliver the story? So, in the end I don't think that it really matters to the small winery’s bottom line, unless off course the liquor store is the winery’s primary channel. How about this thought… if passed this could make wine more easily available to people who don’t yet drink it. They pick up a bottle of $8 Chardonnay to ago along with their scallops and next thing you know they are into wine. Now, a year down the road they are going to the liquor store to pick up the $20 Pinot Noir. Far-fetched? BTW: We voted on this year in Massachusetts a couple of years ago. Failed. Liquor story lobby put up more money up on the hill in Boston.
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