Monday, May 13, 2019

How Long Does It Take?

Two weeks ago I posted about how the PLCB inventory accuracy rate is getting worse. As I mentioned then, I wrote them an email with the link to the story, explained what their mistakes were, and gave them the official government regulations that explain how to determine what spirits should be called. If I gave them any more help, I would have to fix the inventory myself.

Anyone with moderate typing skills could make these corrections in about three minutes. Two weeks should surely be enough time, even with supervisory oversight. Let's see how that worked out.

PLCB - third-rate data entry.
1. 510608 Berkshire Mountain Distillers Bourbon Whiskey - This one is pretty easy. If it's a bourbon, it's not a blend: it's a bourbon.
NOT FIXED: The PLCB still calls it a bourbon, but still categorizes it as a blend.

2. 153 Brixton Bourbon Whiskey Mash Destroyer - I could almost forgive this one, because it's a 'blend' of bourbon and rum; where do you put that? But they couldn't even get the name right! It isn't Brixton Bourbon Mash Destroyer, it's Brixton Mash Destroyer. Why do they constantly add words that aren't there? Put this in SPECIALTIES, but it's not BLENDED WHISKEY.
FIXED: While still in the Blended whiskey section they did fix the name and changed the description enough to show that at least an effort was made.

3. 31328 Clyde May's Bourbon Mash Whiskey - There is no Clyde May's "Bourbon Mash Whiskey." The Clyde May brand has a Straight Bourbon -- which is a bourbon -- and a "Alabama-style Whiskey" -- which is bourbon with apple added, which makes it SPECIALTIES -US, or WHISKEY...
FIXED: Amazingly, the PLCB not only corrected the description but put it in the correct category too.

4. 608012 Crater Lake Rye Reserve- Again, not blended. It's RYE. Pretty simple. Who's making mistakes this simple and stupid? Sorry/not sorry: there's no other way to describe that.
NOT FIXED: The PLCB didn't do anything.


5. 559141 George Dickel Whiskey Single Barrel - Reading comprehension and product knowledge required; no wonder the PLCB got it wrong.  If it is single barrel, what are you blending it with? Imagination? There should be a TENNESSEE WHISKEY category. Most other Tennessees are in WHISKEY, which is such a catch-all it's all but worthless.
TOSS UP: They didn't fix it...but they didn't keep the listing either. The item has disappeared.

6. 528555 Hooker's House Organic Rye Whiskey - There is no record of a "Hooker's House Organic Rye Whiskey" on the Internet...except connected to this mistaken PLCB record. Again, why are you adding words that aren't even there? In any case: RYE, not a blend. Okay?
NOT FIXED. Is two weeks just not enough time? This was one of the easy ones!

7. 34278 Jack Daniel's Sinatra Select Tennessee Whiskey 90 Proof - Given their track record, is anyone really surprised that there's a Jack Daniel's bottling on this list? I've been mentioning this particular one for a few years now. Jack Daniel doesn't make blended whiskey, but that doesn't stop the PLCB from getting it wrong for the past 3 years.
NOT FIXED: Was there any doubt the PLCB would continue to screw up this entry? It is part of their DNA to have at least one Jack Daniel's product wrong.

8. 504228 Jim Beam Eight Star Kentucky Whiskey 8 Year Old - They almost got this one right: it is a blend! But as I mentioned over a year ago...it is not 8 years old. Where is that on this very simple label? Nowhere that I can see.
FIXED!
I wonder who had to read the label and make the command decision that it doesn't say 8 years old.

9. 446 Wigle Phil's Shadow Rye Whiskey Finished in Maple Syrup Barrels - Not a blend. Again, at the very least, a RYE.
NOT FIXED: Not one of the three ryes on the list were fixed. Does Rye confuse the PLCB?


It's ONLY been two weeks!
Pretty weak track record. Two weeks, ten whole work days, and only three entries fixed, four if you want to be generous. I guess none of the managers are the "hands on" type, and not very good motivators. Typical PLCB.

There are undoubtedly THOUSANDS of bad entries in the PLCB inventory; I haven't even looked at the wines. If they can't fix even half of a small sub-group when given all the information...imagine how badly they are doing when they have to find out and correct these things through their own means.


This access to 'all the wine and spirits in the entire system' is supposedly one of the advantages of the State Store System of Stores. You don't have to chase supply and price through hundreds of individual stores, like in those terribly disorganized "free" states. If the database is so badly disorganized that you can't find what you're looking for...where's the advantage?

There is none. Privatize now.

Monday, April 29, 2019

They only fix it if you poke them with a stick

Eighteen months ago I wrote in "PLCB Stupid Inventory Part 100" how five out of only 53 items in the "Blended Whiskey" category of their product database were...in the wrong category, about a 10% error rate. If you got 10% of your job wrong every day, would you still have that job? Would your boss who accepted that rate of failure have his job?

That's when I wrote that post; I started poking them with a stick.


So 18 months later...the PLCB error rate in Blended Whiskey is now over 13.8%. Way to go, guys. The PLCB has two ways to look up things. The so-called flat file inventory that I use here, which has everything in one place, or the slower, seemingly less accurate one on the FWAGS website, which is just as bad, in its own way. The flat file inventory also allows you to look up things by type, which is what I'm doing below.

Tell you what. I'm feeling generous today, so I'm going to list a few items that they can't seem to figure out and tell them why they're marked wrong. I'll even send them the list. But you know...I'm pretty sure the next time I check, they'll still be wrong, and there will be new things wrong too. But maybe they'll learn. Maybe.

All the federal regulations that pertain to whiskey classification can be found online in the Electronic Code OF Federal Regulations. That's how you know what kind of whiskey you have, and how it's going to be labeled. Maybe somebody in the PLCB has read it, but I have my doubts.

Most of these won't even require a reading of the regs. They're pretty simple. Let's have a look at what's wrong with these entries in the Blended Whiskey category.

Now this is bourbon!
1. 510608 Berkshire Mountain Distillers Bourbon Whiskey - This one is pretty easy. If it's a bourbon, it's not a blend: it's a bourbon.

2. 153 Brixton Bourbon Whiskey Mash Destroyer - I could almost forgive this one, because it's a 'blend' of bourbon and rum; where do you put that? 

But they couldn't even get the name right! It isn't Brixton Bourbon Mash Destroyer, it's Brixton Mash Destroyer. Why do they constantly add words that aren't there? Put this in SPECIALTIES, but it's not BLENDED WHISKEY.

3. 31328 Clyde May's Bourbon Mash Whiskey - There is no Clyde May's "Bourbon Mash Whiskey." The Clyde May brand has a Straight Bourbon -- which is a bourbon -- and a "Alabama-style Whiskey" -- which is bourbon with apple added, which makes it SPECIALTIES -US, or WHISKEY...

Which leads you to ask: why does this database have a LIGHT WHISKEY category that has no entries, but no WHISKEY (FLAVORED) category...in 2019? 

4. 608012 Crater Lake Rye Reserve- Again, not blended. It's RYE. Pretty simple. Who's making mistakes this simple and stupid? Sorry/not sorry: there's no other way to describe that.

5. 559141 George Dickel Whiskey Single Barrel - Reading comprehension and product knowledge required; no wonder the PLCB got it wrong.  If it is single barrel, what are you blending it with? Imagination? There should be a TENNESSEE WHISKEY category. Most other Tennessees are in WHISKEY, which is such a catch-all it's all but worthless


6. 528555 Hooker's House Organic Rye Whiskey - There is no record of a "Hooker's House Organic Rye Whiskey" on the Internet...except connected to this mistaken PLCB record. Again, why are you adding words that aren't even there? In any case: RYE, not a blend. Okay?

7. 34278 Jack Daniel's Sinatra Select Tennessee Whiskey 90 Proof - Given their track record, is anyone really surprised that there's a Jack Daniel's bottling on this list? I've been mentioning this particular one for a few years now. JD doesn't make blended whiskey, but that doesn't stop the PLCB from getting it wrong for the past 3 years.

8. 504228 Jim Beam Eight Star Kentucky Whiskey 8 Year Old - They almost got this one right: it is a blend! But as I mentioned over a year ago...it is not 8 years old. Where is that on this very simple label? Nowhere that I can see.

9. 446 Wigle Phil's Shadow Rye Whiskey Finished in Maple Syrup Barrels - Not a blend. Again, at the very least, a RYE. 


I bet the answer is down here - I've looked nowhere else!
So there you have it, PLCB. The gauntlet is tossed. Clean 'em up. Oh, and don't fall back on the old excuse that you are told by your suppliers what these are. Just read the freakin' label, and copy it into the database without editorial additions. Easy-peasy. Get it done, or I'll have to get that stick out again. 

Tuesday, April 23, 2019

A Look Back At The Wine Kiosks

We have a guest post today. A member of our Facebook group -- Abolish the PLCB -- Rewrite the Code! -- Wende Phifer Mate, wrote a remembrance of the wine kiosks. It was so good, we decided to run it here (with permission, of course).

Great moments in PLCB history. 

Did anyone ever try to purchase wine from one these kiosks? I lamented the passing of them because they provoked more laughter than most comedians do.
Among the highlights:

  • The instructions - not bad if you had an hour to kill.
  • The ID checker - you had to put your drivers license into a slot, then look into a camera in order to pass on to the next test. Hard to do with a straight face.
  • The breathalyzer - yes, you had to breathe into a weird tube before the machine would allow you to proceed. It did not always register that it had been breathed into until you were about to pass out from trying.
  • Choosing your wine - you had to wade though the whole list of available wines on the touchscreen. There was no other way to make a selection. Needless to say, it took some people FOR...EV...ER to get through this part. 
  • The delivery system - It was like those candy machines that push the item forward until it drops. Has there ever been a more stupid idea! I watched one of my bottles crash to the floor inside the machine before it got to the collection window. I read later that this was a very common occurrence.
  • The bags - Plastic bottle bags were provided but three that I pulled out had slits in the bottom. Bottle goes in, bottle goes right out the bottom. (That's another sale!)
In short, they worked just as you'd expect they would, coming from the masterminds running the PLCB.


We miss them too, Wende, but like some of Joe "Da CEO" Conti's best moments, they are a gift that keeps on giving. Whenever the PLCB starts to seem reasonable, just remember: they're only one brain-fart away from another great idea like the Wine Robot Army. That's why we say:

Privatize.

Monday, April 22, 2019

As required by law......

There are numerous "newswires" available; the majority of them just reprint press releases from businesses. So and so got promoted, Corporation XYZ broke ground for a new building, that sort of stuff.

But in the insecure world of the PLCB, where every single scrap of good news is treated like a cure for cancer, we get crap like this, telling us that the PLCB gave back license fees to municipalities. That's a press release essentially saying "The PLCB is going to follow the law." It even says, right in the release, "As required by law." Imagine if the Department of Corrections put out press releases saying, "As required by law, inmates were released at the end of their sentence." Or if PennDot decided to let us all know, "As required by law, plow drivers will follow traffic signals."

Maybe the PLCB is trying to make up for all the news that's being reported by independent journalists about graft, nepotism, back door deals, lack of ethics, destroying evidence, shoddy record keeping, wine kiosks, Water Heater Joe, overcharging and variably screwing the citizens. I can think of better ways to do it, though. Here's one example for businesses to follow:
Can you imagine the PLCB actually doing this?
Now I'm all for transparency in Government. That's another reason I don't like the PLCB: they are the least transparent of any state organization. Want to find out how much the Department of Education paid for a chair? You can actually look at the bids, see who won, and what the bid was for those chairs. But if you want to find out how much the PLCB paid for that case of vodka...it's suddenly become proprietary information. It wasn't before Act 39, and there is nothing in Act 39 that makes it proprietary; the PLCB just decided it was so. They say this is so Company A doesn't know what Company B is paying, and that makes negotiations fair.

That would be true in the open market...but not in a government-owned and operated monopoly. You see, it doesn't matter if either one of those companies know what the PLCB is paying them - they have nowhere else to go if they want to sell in Pennsylvania. Each product is a game of chicken between the PLCB and the supplier. The PLCB says, we'll only pay this much or we won't carry it, and the supplier says no, you'll  pay this much or you won't carry it.

So who blinks first? The PLCB, because they won't be providing what the consumer wants (even more so than now), or the supplier, who might lose overall sales? Add to that the knowledge that both sides know what a suitable substitute* would cost the PLCB, and you have price competition. The PLCB doesn't know if the price they paid for that substitute is equal to or above what the supplier they're currently negotiating with is willing to take and the supplier doesn't know if the price they are offering is above or below what the PLCB is willing to take. Of course, all that requires work and if done fairly, would benefit the consumer and so is antithetical to the PLCB way of doing things.

Remember: the Board members ultimately make the decisions about what you get to buy. They are political cronies with no experience in the liquor business; almost every one has been a lawyer with political connections. And you don't have any say in who they are. These aren't elected positions, and they aren't hires, subject to the civil service regulations. The one good thing you can say is that they aren't full time employees, so they can't screw things up 24/7.
The lack of qualified people on the Board is mostly the fault of the Governor - all of them since 1934. They could appoint people with industry experience...but they don't. Instead, they use the PLCB to pay back supporters, cronies, contributors, any non-qualified person they can find. And the legislature rubber-stamps them, which makes them culpable, too.

We need to change the system to something that works for the people. A system that allows freedom of choice, allows convenience, allows competition, and allows government to focus on regulation. We need privatization


*A suitable substitute is something that satisfies the consumers desire for a product or type of product. For example, Nikolai would be a suitable substitute for Vladimir vodka on the low end, and Ciroc for Grey Goose on the higher end.

Monday, April 15, 2019

Chalmers Selection Event Wine, For all your PLCB events!

HARRISBURG, Pa., April 14, 2019 /PRNewswireless/  

The Pennsylvania Liquor Control Board Fine Wine and Good Spirits State-Owned Monopoly Retail Stores Of Distinction is proud to announce exclusive Pennsylvania rights to the new Chalmers Reserve Event Wine. Presenting a bottle of Chalmers Reserve Event Wine to Chairman Tim Holden (represented for the event by a cardboard cut-out figure), Director of Wines (Other) Sue Broomhall stated, "Everybody at the PLCB knows that the better the commercial, the better the wine. One bottle of Chalmers and your party will certainly get started."

"So true!" shouted a group of non-certified wine specialists from the PLCB's luxurious tasting room. 

"And Pennsylvania consumers won't even have to pay the $1 a bottle cost mentioned in the commercial" Ms. Broomhall continued. "With the flexible pricing authorization of Act 39 allowing us to negotiate prices and markup, we are proud to bring this to Pennsylvania for only $14.99 a bottle!"

For further information on this and other exciting items soon to be seen at the State Store System of Stores, or maybe at the return of the Wine Kiosks®, please contact your local store. They'll be glad to provide whatever they decide you need. 



Thursday, April 11, 2019

Death By a Thousand Cuts: it's working!

Thousand cuts, baby. That's how I like my hoagies.
Seven years ago, when UFCW 1776 President (For Life) Wendell W. "Windy Wendy" Young IV was faced with the reality of wine sales being allowed at grocery stores (and the possibility of wine sales at beer distributors, but the beer distributors bobbled that), he predicted that it would mean the end of the State Store System. "Young says allowing wine to be sold by private sector would take away business from state stores and be the 'death by a thousand cuts' to the state store system."

Such drama! And then it went through, and Wendy didn't say nothing more about it. In fact, The Haircut That Walks Like A Man hasn't had much to say since Act 39 went through in 2016, probably because he figured flexible pricing was going to be such a bonanza for covering the constant rise of operating costs that his job was done. 

But that "thousand cuts" call is coming back to haunt him...because it looks like he was right

Last week, I asked the PLCB for wine sales figures from the past three years for the State Stores, private sales, and overall sales. It's an interesting picture. I had to break it up to fit it into the format of the blog; here's a comparison by unit sales, the number of bottles sold. "Non-licensee" is the State Store sales; "Licensee" is sales through licensed private retailers: bars, restaurants, resorts, and grocery/convenience stores (that includes by-the-drink sales, which you would assume are relatively steady year-on-year).

2015 is prior to the shift to bottle sales at the licensees; 2016 was a partial year, and 2017 is the first full year of such sales. Notice the huge jump that year: 39.9% rise in licensee sales, followed by a 17.4% rise in 2018. Look at the 2015 numbers vs. the 2018 numbers: they almost doubled in three years. Meanwhile, the State Stores were sucking wind: a 4% drop in 2017, a 3.7% drop in 2018.

Calendar YearCustomer TypeUnit Sales% Change From Prior Year
2015Non-Licensee67,034,168N/A
2015Licensee13,331,217N/A
2015Total80,365,385N/A
2016Non-Licensee68,507,8842.20%
2016Licensee15,282,49214.60%
2016Total83,790,3764.30%
2017Non-Licensee65,797,156-4.00%
2017Licensee21,377,50539.90%
2017Total87,174,6614.00%
2018Non-Licensee63,333,698-3.70%
2018Licensee25,099,20817.40%
2018Total88,432,9061.40%

How about dollar sales? Looks about the same, though the licensee dollar sales actually grew a bit more than volume sales did, each year...which means the State Stores are moving more bulk tanker stuff, and the private stores are skimming some of the higher-ticket sales. A thousand cuts, indeed. 

Calendar YearCustomer TypeDollar Sales% Change From Prior Year
2015Non-Licensee$835,985,290N/A
2015Licensee$138,374,473N/A
2015Total$974,359,763N/A
2016Non-Licensee$862,634,3393.20%
2016Licensee$160,312,44015.90%
2016Total$1,022,946,7805.00%
2017Non-Licensee$827,676,034-4.10%
2017Licensee$225,796,24240.80%
2017Total$1,053,472,2763.00%
2018Non-Licensee$812,080,965-1.90%
2018Licensee$266,808,65518.20%
2018Total$1,078,889,6202.40%
Private stores = more state revenue, more jobs

Overall sales are still growing, which is going in the PLCB's pockets because they're still effectively the monopoly wholesaler, but look at how much they grew when people could buy in private stores! Imagine if we went crazy and allowed private liquor sales as well! We'd be rolling in the (Johnstown Flood Emergency) tax revenue; increased sales would clearly eliminate any need for a Washington-style tax increase. Oh, and the PLCB press secretary, Shawn Kelley, happened to mention that they "understand from anecdotal reports from the Pennsylvania Winery Association [that Pennsylvania wine sales] have grown significantly since grocery and convenience stores started selling wine." I'll just bet they have. 

No need to go on; the numbers speak for themselves. I never thought we'd say this, but...Wendell was right. It's not all that shocking, or that brilliant a prediction, though. Give the people a choice, and they'll walk away from the State Stores. Give us the choice on spirits, too, and see how long it is before State Stores start withering and dying on the vine...so to speak.

Privatize. 

Monday, April 8, 2019

PLCB Numbers, PLCB lies: the truth about Bailment

A little over six years ago, the PLCB put in place a system called Bailment. Bailment is a common regimen in the business world...which is probably why the PLCB took 80 years to get there.

Bailment is a pretty simple idea; for instance, when you "give" your car to your mechanic with the implicit understanding that there's only a change of possession, not ownership. The mechanic holds your car until the work is done, and it's understood that the car never changes ownership; you don't have to stand there with your hand on the car to maintain your ownership of it.

In the case of the PLCB, bailment is a little more complicated, but not that much. The way it used to be, a wholesaler would deliver product to the PLCB warehouses, and they'd submit a bill immediately. Under bailment, the product is delivered to the warehouse, but the PLCB doesn't take ownership of it until it is subsequently taken from the warehouse for delivery to the stores. At that point, the wholesaler submits the bill, and PLCB will pay them. Well, not right then, that's not how business works, after all. Everyone works on "net 30," where you have 30 days to pay. The PLCB, of course, pays on "net 90." Because they're a monopoly, so there.


Bailment was touted as a big money-saver for the PLCB, a major 'get' the agency wanted legislative permission to use. It would reduce the PLCB's actual inventory costs, which would seem likely. But it would also allow the PLCB to skip the need for their annual $110,000,000 tax-free, interest-free loan from the General Fund at the start of every year, so they could buy product and have something to sell in the stores. Isn't that the way every business works? Borrow money from Mama to buy stock, and then pay her back...interest-free?

Well...the PLCB did stop taking the loan. Which you would think meant that they should have had some extra money to turn into the General Fund, you know, that big "contribution" that the Legislature tells them they're going to make. Yeah, that didn't happen. The amount after bailment was the same as the amount before bailment - $80,000,000.

We don't care -- it ain't OUR money, it's YOUR money.
The big talkers from the clerks' union say that there wouldn't be any increase just because the loan wasn't needed, because that money was used to buy the startup inventory. Let's look at that in round numbers to make it easier to follow.

Say I (as the PLCB) borrow...$100 million to buy inventory. In the course of the year, I make $500 million selling that booze to unhappy Pennsylvania citizens (unhappy because they have to buy from me!) before expenses. I then have to pay back the $100 million, which leaves me with $400 million to pay my other bills. But because of The Wonder Of Bailment!!!, I didn't spend as much just to have things sitting in my warehouse, so I didn't need that $100 million loan...which means I have the full $500 million before expenses. That money is now mine to spend on other things...like increasing the amount turned into the General Fund.

But that didn't happen, nor is that money accounted for in store remodels, in fact, there are fewer stores now than there were then. It's not accounted for in increased education, increased money to enforcement, or buying new LCBee costumes. So where did it go? 

Well...about the same time, the PLCB was putting in a new Oracle computer system. Unfortunately, just like the system they installed before, they didn't do a very good job (the Auditor General said so; both times). The cost overrun was about $40,000,000 (although it was spread out over a few years). Inventory expenses went up over $20,000,000 the first year, even though Bailment was supposed to reduce inventory costs and keep them low. Store, warehouse, and transportation costs went up $25,000,000. Stores' operations and supervision expenses went up $25,000.000  Overall, for the first two years of bailment, PLCB Operating expenses went up over $82,000,000! While both years had "record sales" (so knock-down easy to do in a monopoly that we wonder why they keep saying it), the PLCB had record expenses to go with them and pretty soon...the $100 million was gone.


So...all that money bailment was going to save through reduction in inventory costs? Last year, inventory was about 2.5% shy of pre-Bailment levels. One gets the feeling that the PLCB uses the Servpro motto - "Like it never happened."

After seeing what a bang-up job the PLCB did with our money here, maybe we'll check into how well variable pricing is screwing the citizens, and why we aren't seeing that extra $185 million that wonderful plan was supposed to bring in. We have a sneaking suspicion that the words "rising operations costs" are involved...