Southern goes to NY

[Thomas]

The largest and national 3 tier distributor is entering the NYState market in 2005.

In order for that move to be effective for the company, the State Liquor Authority will have to change things (regulations) considerably, and the entity already has started in that direction: Sunday retailing, 30 day net payables, and the big one sure to come, wine in grocery stores.

Small specialty distributors should fear not, so long as there are wine retailers interested in wine instead of just boxes. But big NY wholesalers, thus far protected, should be quaking in their boots, except the ones ready to sell out...

[hotwine]

Love it! (Ain't competition wunnerful?)

[Kcwhippet]

This raises a question in light of the rash of mergers, acquisitions and takovers going on in the wine industry as a whole. Constellation's purchase of Mondavi effectively makes them the 800 pound gorilla in the industry, which can give them a huge impact on wholesale and retail movement of their products versus their competitors. Similarly, Southern has also become a huge player. I'm sure all their direction comes from the top despite what may be some weak regulations at the local level. So, that also makes them able to direct placement and loading at the retail level. All that said, does anyone know if there are any regulations with real teeth (federally or locally) that can keep these huge entities from exerting monopolistic pressure that would benefit them at the expense of their competitors (those that are left standing)? I can also see them being able to apply pressure in the right places (for them) to steer the outcome of such things as the direct shipping issue.

[wondersofwine]

Can't answer to most of your points. I feel (hope) that gradually the consumer is winning the direct shipping issue at least from winery to consumer (NC now allows that with certain restrictions--I think winery must license in NC and pay an annual fee. Sainstsbury said they can now ship legally to me) Supreme Court will be hearing the case this year I believe and may rule in favor of the consumer and interstate commerce. I still may not be able to order from a retailer in NYC or Chicago, etc.

[Thomas]

KC, there are regulations, but there are also corruptions--the latter usually wins over the former.

I have to say, the times that I have seen NY regs applied against industry people (fines, etc.) has generally been when a bigger entity complains about a smaller one--hardly ever in the other direction. I wonder why???

Southern has already made an impact on the SLA regs; it is likely to take a lot of control by the mere force of its market power. And yes, retail shelves will reflect that power, except in small stores that are focused on certain wines or genres. But small is a thing of the past in the USA. I fear the idea of small retailers in NY (anywhere) is nearing that condition.

Has anyone seen the Frontline program about Walmart? Scary stuff. The interesting thing about these large conglomerates is, by their nature, and by their activities, they not only reduce choices to sameness, and reduce quality to price-only products, they also lower our general standard of living where those who work for these companies can afford to buy only from them. I suppose the wine industry is not immune.


[This message has been edited by foodie (edited 11-18-2004).]