A forum for and about wine retailing. Consumer questions, retailer rants, etc. All are welcome to post
Post Reply
HZ Tarar
Posts: 9
Joined: November 29th, 2018, 2:02 pm


#1 Post by HZ Tarar » November 29th, 2018, 3:06 pm

Archived content
Last edited by HZ Tarar on January 17th, 2020, 11:44 am, edited 1 time in total.

Posts: 104
Joined: January 28th, 2010, 8:21 am

Re: Crowdsource Question: Disrupting the Three Tier Model?

#2 Post by justinmcinerny » January 10th, 2019, 7:14 pm

Unless I am missing something, your idea seems to be unworkable in today's regulatory environment. I am a Maryland retailer. The laws here strictly prohibit partnering with a business in another tier. Maryland's laws also preclude direct to consumer imported wines. It is probably a safe bet that the laws in many other states on this issue are comparable to Maryland's. See for example what happened to the Bastianich Family in New York a few years ago ... sla-issues. Many, if not most, states probably prohibit 'exclusives'. Unless you have a limited, tightly allocated item or a private label, then you are generally obliged to make it available to all licensees. Your proposal might be comparable to what Total Wine seems to do in their Winery Direct program ... ewall=true. However, it's unclear to me what Total means by Winery Direct because, as I said, relationships between producers and retailers are generally illegal.

For what it's worth, I am stridently opposed to the three tier system. I have been trying to disrupt it in Maryland for years. I have been lobbying, I have been in the press, I have organized licensees. I am not getting anywhere. There is very little political will to make any major changes to the system. Minor gains have been made in the areas of domestic direct to consumer or licensee wine and beer (at least craft beer). I don't know anything about spirits. My hunch is that any significant reforms to the three tier system will come from the courts, not the legislatures.

Feel free to PM me. I am thoroughly engrossed in this topic but I can really bore people who don't share my enthusiasm for it.
ITB - retail
suburban DC

User avatar
Randy Bowman
GCC Member
GCC Member
Posts: 10209
Joined: January 27th, 2009, 2:23 pm
Location: Napa, CA

Re: Crowdsource Question: Disrupting the Three Tier Model?

#3 Post by Randy Bowman » January 10th, 2019, 8:01 pm

My brother-in-law has a retail wine store, got fed up trying to gets the wines he wanted by buying futures and got himself an importer's license. Spent the money to tour the wineries of Europe to build a good portfolio of wines he could import. All the majors, (the ones he wanted), wouldn't give him the time of day and the next tier was pretty much the same. He wound up with several smaller, lesser or unknown wineries from France, Spain and Italy. He tried to make it work but in the end, the wines went to his entry level wine club members or he cooked with them because they didn't sell in his store, nor could we move any of them for him from our store. Guess who the biggest competitor for his wines were? Trader Joes and Cost Plus Imports. They were cheaper too.

Unknown/little known are hand sell with no quotable accolades. We carry and sell Zardetto Prosecco. It retails for $15.00. It moves fairly well and is a an easy hand sell to people seeking a sparkling for Mimosas.

I'm a retailer. Can you sell me a Prosecco, including delivery to me here in Napa, CA at a price cheap enough to compete with Zardetto and is it as good as Zardetto?
IN THE BUSINESS SHILL: An associate of a person selling goods, who pretends no association to the seller and assumes the air of an enthusiastic customer.

User avatar
Thomas Keim
GCC Member
GCC Member
Posts: 11035
Joined: June 7th, 2009, 5:52 pm
Location: St Paul, Minnesota

Re: Crowdsource Question: Disrupting the Three Tier Model?

#4 Post by Thomas Keim » January 15th, 2019, 8:15 am

you have two options as an importer -

1) Break your pricing structure down into three tiers, for example: PROSECCO: delivered to your door for $5.00 a bottle. Sell it to wholesaler for $7.50 per bottle - wholesaler sells it to retailer/restauranteur for $11.00 - retailer sells it for $16.00 - you ALWAYS have to work on the end result (the final price) to work in the three tier system.

When you are visiting cellars looking for potential products, you should always look at the FOB price delivered to your door, then triple the price, adding on another 20% for good measure, and that would be your suggested retail price.

2) Find a large chain/large store in each state who can purchase direct (and work with the product as an exclusive). Now you still have to go through the three tier system, but most large chains/big box stores have wholesalers they work with who will bring the product in for 10% over cost - this allows them to purchase the product for $8.50 a bottle, and sell it for $16.00 and make a much bigger markup.

Good luck -
ITB - The Yoerg Brewing Company

"What if I fall?" "Oh, but my darling, what if you fly?"

Posts: 107
Joined: July 24th, 2017, 9:44 am
Location: Colorado

Re: Crowdsource Question: Disrupting the Three Tier Model?

#5 Post by BlaineRyanHunt » January 20th, 2019, 10:14 pm

I work ITB and have had nightmare with the 3 tier system and wish to see it abolished.

User avatar
Eric Ifune
GCC Member
GCC Member
Posts: 3652
Joined: June 19th, 2009, 7:43 pm

Re: Crowdsource Question: Disrupting the Three Tier Model?

#6 Post by Eric Ifune » January 24th, 2019, 8:37 am

I've a friend who's a small importer. Concentrate on small unknown (at least in the US) estates outside the big areas, e.g. France, Italy. They managed to get accounts with some quite well known and iconic producers (at least in their home countries). They also had to do lots and lots of legwork, getting people to try their wines.

Post Reply

Return to “Wine Pimps”