Probably a different discussion altogether, but the way the 3-tier system here for American wine is sown up between 2 or 3 players that all are completely beholden to big corporate wine - doesn’t help. I think customers would love to buy from good small producers, they just can’t do it today unless they buy direct or perhaps seek out very specialized distributors.
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Would love to see the 3 tier system ended. Its a legacy business model that just isn’t necessary any longer.
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Any new system would have its pros and cons. KY has a 6% excise tax on alcohol that the distributor pays and is included in my prices. I foresee problems if all the retailers and on premises establishments were suddenly responsible for paying those taxes.
A current complaint I have is that the national distribution company of a favorite wine now has stopped distributing the product in KY. Not sure, if left to the wineries, they wouldn’t be worse. Would they then drop distribution from 40 States to 10 if they could?
If volume discounts become illegal, how about on premises vs off price differences?
Who eats the increase in shipping costs? Our distribution companies can get truck load contracts, while we can only get case shipments prices.
Is there an expectation that all these small independent shops will suddenly be able to deal with the importers?Do you believe Joe Smuck liquors will be able to call KL and buy 3 bottles of some CdP or Burg? It so, at what price?
I often get reallypissed at the 3 tier system, but not ready for the alternative. If I need two cases of X wine, I certainly don’t want to have to call CA and wait for ( and pay) for FedEx to deliver.
A question, if volume discounts are illegal, does that now apply to retailers. Programs such as 10 or 20 % discounts for volume buying would then likewise become discriminatory and illegal?
Thanks Tony. Merry Christmas!
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