The Difference is What They Steal From You

I did a short post on this for the "Abolish the PLCB -- Rewrite the Code!" Facebook group. If you missed it there (and you really should join), this is the full version.

I'm about to go out shopping for my Labor Day get-together (planning ahead, as the PLCB minions always nag about). Phone in hand, I'm checking prices, just on the rare case that the PLCB put something I want on clearance. Because that's the only way they ever beat Total Wine's pricing. No surprises: no clearance deals, and nothing I wanted was on sale, or the difference might have been greater.

I usually go to New Jersey, but the Total Wine in Towson, Maryland was closer, and even with the so-called "Free State" (what bitter irony) charging a 9% sales tax on alcohol it worked out to about the same total cost as New Jersey, but with less driving time. This is a big store at 30,000 sq.ft. A true Superstore unlike anything in Pennsylvania. They also sell beer — like any real liquor store would — and as a bonus (for me, at least), they sell cigars, too. If Total Wine has a variable pricing scheme, it at least appears to favor the consumer with lower prices, and not just the owners. Competition will do that.

Here's the Pennsylvania version of variable pricing at work. Jack Daniel's is the largest selling American whiskey nationwide, and in both Pennsylvania and Maryland. If you compare the prices on big brands like that, keep this in mind: every dollar difference is what the PLCB is stealing from you with variable pricing. You know that Total Wine isn't losing money. They're set to overtake the PLCB in total sales shortly, so they must be doing something right, even though they have to deal with competition and not the easy ride of a police enforced monopoly.

Dare to compare:

Kendall Jackson Chardonnay Vintner's Reserve California PLCB $15.99, Total $9.97 - $6.02

Maker's Mark Straight Bourbon Whisky 1.75L PLCB $59.99, Total $44.99 - $15.00

Kim Crawford Sauvignon Blanc Marlborough PLCB $11.89, Total $10.97 - $0.92

Apothic Red PLCB $12.99, Total $7.97 - $5.02!

Tito's Handmade Vodka 80 Proof 1.75L PLCB $34.99, Total $28.99 - $6.00

Jack Daniel's Old No 7 Black Label 1.75L PLCB $46.99, Total $39.99 - $7.00

These are common choices, big sellers. Nothing out of the ordinary or esoteric to skew the results. It does show how badly we are being treated, how badly the PLCB is managed, how badly variable pricing is being abused...and how much the PLCB lied to get it. We told you this would happen. And here it is, in black and white.

End the charade. Privatize.

Run like a business? Really?

We're told to look at the PLCB as a business, as one of the largest alcohol retailers in the world. Well, okay...then let's do that, by comparing the PLCB to one of the largest alcohol retailers in the world: Total Wine & More.

Here's how Total Wine runs their business: Hire people to run your business who already have experience with large retail operations, ideally ones who have actually run businesses larger than you currently are so they can guide you toward growth. Hire people that already fit your business model, not ones you owe a favor to or who "contributed" to your cause. Find executives with experience in the product you sell or the sales model you use. Staff the stores with people that work toward company goals. Make sure there are enough qualified people on duty to cover store hours. Finally, provide a compelling reason for people to go to your stores and not the competition's.

Here's how the PLCB does it: Fill your 'business' with political hacks who have no experience running any business even remotely close to the size of the PLCB, nor any firsthand knowledge of retail or wholesale liquor or wine. Mix with a "we don't care what you want" attitude and staff with people who are almost immune to being fired and get promoted based on time in grade, not product knowledge or performance. Stir in a large amount of "We've always done it this way," toss in a goodly amount of graft and nepotism, and you'll have something that resembles the PLCB.

Drilling down, let's look at the comparative qualifications of the PLCB board chairman and Total Wine's chairman, and see how they stack up.

PLCB Board Chairman Tim Holden

Education: BA Sociology, Bloomsburg University
Work Experience:

• Probation officer
• Real estate Broker
• State Representative
• U.S. Congressman 
  1. Vice chairman House Agriculture Committee 
  2. Chairman of the committee's Subcommittee on Conservation, Credit, Energy and Research
  3. Member Livestock, Dairy and Poultry subcommittee
  4. Member Transportation and Infrastructure committee.

"Congressman" is a pretty impressive entry on a resume, to be sure, but...Agriculture? Poultry? Transportation? Conservation? Where's the booze, Tim? For that matter, where's the retail? He does have a nice smile, which always helps in retail.


Total Wine & More Board Chairman Adrian Bellamy

Education:

• Bachelor of Commerce, University of South Africa
• Master of Business Leadership, University of South Africa

Work Experience:

• Chairman and CEO of Edgars Stores (clothing)
• Chairman and CEO DFS Group Ltd. (leading luxury retailer)
• Executive Chairman of The Body Shop International (global personal hygeine retailer)
• Chairman of Reckitt Benckiser PLC (Major consumer product manufacturer, $13B revenue)
• Chairman of the Board for Williams-Sonoma Inc. (renowned houseware retailer, $4.5B revenue)
• Board Member of Action (Netherlands-based value retailer)
• Board Member River Island (London-based fashion retailer)
• Previous Board Member
  
  1. Robert Mondavi Corp (wine)
  2. South African Breweries Ltd (beer)
  3. Starbucks Corp. (coffee; retail)

Nice smile. This is a simply stunning business resume, based solidly in retail and consumer products; experience with the wine and beer industry. Bellamy is clearly a major player in worldwide retail.

Those are pretty close — "congressman," after all — but I have to give the edge to Mr. Bellamy. This isn't a blast against Mr. Holden in particular. He's no more qualified than any of the other PLCB board members of the past 82 years, and just happens to be in that position now as I write this. I could do the same for the other Board Member Michael Negra (who does have significant business and retail experience, if not in booze) in comparison to the rest of the Total Wine Board, but you can follow the links and see for yourself. If this really is one of the top wine and spirits sellers in the world, you would expect it to be run by top management. It simply is not.

We residents have been hearing the lip service about how the PLCB wants to run more like a business. One of the first things you do to move toward that goal is to hire people who know and understand the business you are in, something the State has consistently failed to do. Given the newest PLCB Board member to be nominated, whose qualifications appear to be that he worked for Governor Wolf, gave money to Governor Wolf's campaign, and is a personal buddy to Governor Wolf, that pattern of willful failure will likely continue.

Privatization allows entrepreneurs to use their vision, drive, and work ethic to grow their businesses. Monopoly does not. The choice is simple and has been made by everyone already. Private business is how you buy practically everything else (and it's how you buy wine and spirits as well, apparently, if you live within ten miles of the border). It works, if it didn't, we'd have state-run gas stations, grocery stores, pharmacies, and other retail.

So here's to 2016, may it bring an end to outdated policies from the 1930's. We get closer every time, and as the PLCB supporters themselves admit: we only have to win once. Because we'll never go back.

The PLCB responds to the Smackdown.

The PLCB response to the Smackdown?  I don't know but I can see it...

A meeting in the $40,000 PLCB drinking lounge they have set up in Harrisburg. The big screens are showing the Travel Channel, and soft music is playing. The question: what to do about the cheeky ad Total Wine ran directly comparing prices with the State Fine Store Wine and State Good Store Spirits Shoppes; and not too good a comparison for the drones in old Harrisburg. Ideas are not developing, but then someone gets a rush of blood to the brain.

"Hey, let's allow this rum to be put on special. We'll make up some cool tags and let everybody know we can put bottom shelf liquor on special too." No one has any better ideas, so the mighty marketing muscle of the PLCB lurches into action.

The next week, the sale is on, but the one brainy manager in the system (who runs the store in Snow Shoe, open three days a week for customer convenience) spots something amiss. "There is something that doesn't look right with these tags. It did pass the Art Department, The Printers, the Marketing Department, The Store Operations Director, and then was approved by the Board though, so I guess it is OK.

"But I thought that a liter was a third more than a 750ml. I guess I was taught wrong in school if all those smart people agree it's actually 25% more. Wait, isn't 'then' used to indicate time of some kind, and it's 'than' that's used for comparative purposes? Naw, they couldn't have two mistakes on one tag; nobody is that incompetent, not even in Harrisburg! Well, nobody will notice anyway. If our guys didn't catch it, then (or is it than?) the public won't either. What do they know about math and grammar compared to the folks in charge of the PLCB!"

Yup. It's a classic. Pure PLCB.

No wonder the PLCB doesn't like selling liters anywhere other than at their so-called "outlet" stores. The math makes their brains hurt!

(P.S. Total Wine sells the 1.75L at a lower cost per oz  even with the PLCB "sale")

I’m a hater

Or at least that is what one pro-PLCB representative called me and he is right: I hate a lot of things about the PLCB. I’ll start off with these two dozen or so and you can add your own in the comments.

Oh PLCB, how do I hate thee, let me count the ways.

• I hate going to the state stores.
• I hate that they don't have what I want.
• I hate that most of the time I can't order it.
• I hate that if they do have something it is usually more expensive.
• I hate that Philadelphians (or any Pennsylvanian, for that matter) don't have legal access to anything approaching the selection of Joe Canal's, Moore Brothers, Total Wine, BevMo, and a host of others.
• I hate that even the PLCB's buyers know so little about brown spirits.
• I hate that the so called 'wine specialists' don’t work standard hours; say noon to eight when most customers could use them.
• I hate that the state cheats its own citizens by not allowing liter size bottles to be sold everywhere.
• I hate that the alcoholic's best friends -- the mini, the half pint and the pint bottle -- are cheap in PA, but the 1.75L bottles are 99% of the time more expensive.
• I hate that a manager can’t even set up the stores they manage to best suit their customer base, but have to follow the forms sent by Harrisburg that tell them where every bottle has to be placed.
• I hate that the PLCB doesn’t even figure that out themselves, they hire an out of state firm to do that for them. 
• I hate it when the union says that five West Virginia counties lost all service when they privatized...but don’t tell you people in those counties still don’t have to drive as far as residents of the 20 PA counties that have only one or two State Stores.
• I hate that while Gross From Sales  has increased 75% since 2000, contribution to the PSB only went up 49%, contribution to Drug and Alcohol education only went up 60%, and that in this "record year" the total contribution from sales is less than the average of the past 14 years.
• I hate wine kiosks and the very idea of wine kiosks; anybody who had a hand in insulting the consumer in that way should have been fired.  
• I hate that the three members of the actual liquor control board worked only 21 days last year.
• I hate that they need a $150,000 babysitter because the board can’t manage to work more than 22 days this year.
• I hate that somehow the PLCB thinks that the alcohol in beer is different than the alcohol in wine or whiskey.
• I hate that I can’t get a case discount to try and mitigate the usually crappy prices.
• I hate that people think the state stores are a cash cow when in reality the non-tax contribution is under 3/10ths of 1 percent of the budget.
• I hate it when we are told that PA has the lowest incidence of underage buying when the state stores are never checked for compliance.
• I hate that the PLCB spends more on advertising than education. Just what are they actually trying to do?  Make sure young people know what to buy once they are 21?
• I hate it that the union thinks one poll counters four decades of polling that show the citizens want to be rid of the state stores.
• I hate that the PLCB thinks convenience has gone up after closing 20% of its stores.
• I hate that the PLCB keeps spending money to rename the State Stores.  No matter what they call them they are still going to be State Stores.
• I hate that some cube rat or committee in Harrisburg decides what an entire state is allowed to buy.
• I hate that the PLCB online inventory has hundreds, if not thousands, of mistakes in spelling or placement making it far more difficult for the consumer than other online retailers.
• I hate that I live as far away from New Jersey and Delaware as I do.
• I hate that after 80 years we are still discussing what the majority of the states have already figured out.

To show I’m not all bad I loved Joe Conti.  He was so incompetent that I wondered if he was secretly working for privatization.

Privatization IS Modernization and government control of retail is Socialism.

When the leadership is clueless….the followers are clueless.

I can understand that there are a number of PLCB workers who may not have the time or the inclination to fully pay attention to everything that is going on with privatization and that they depend on those above them to provide information in condensed form.  However, when the leadership either doesn’t know or is flat out lying it is then that we see the re-education camps really have them brainwashed.  To wit, this is a quote from the Director of Collective Bargaining for UFCW 23 James "Bryan" Bond:

“We have the most selection, best stores, and knowledgeable sales folks in comparison to any other state on this side of the US. We are number 2 in sales out of all 50 states, and the safest state for not selling to minors. The huge profits benefit all people who live here. If that profit goes away, wait until you see your future home tax bills. Don't believe me? That's what Washington State did and they are sorry about it now.”

It seems that Mr. Bond has never been out of state and seen Moore Brothers, Total Wine, Buy-Rite, Binny’s or any number of other stores that absolutely dwarf the selection of the largest PLCB store. Even if he means what can be ordered those other stores will order things for you too so at best it might be a tie but I personally doubt it.

Best stores is a personal opinion so maybe he really believes that but as far as the knowledgeable sales folks compared to all east of the Mississippi he has to be dreaming.  There are multiple stores in New York alone that have Sommeliers on staff while the PLCB has or had one as a consultant.

Being #2 in sales out of all 50 states.  California is certainly #1 but does he honestly think that PA sells more alcohol in total than NY, Texas, Florida and Illinois? Guess what – they don’t.  Maybe he means that PA is #2 in control states which they may be. I’ll give him #2 of the 17 control states but not of all 50 states.

The safest state for selling to minors.  Since none, not a single one* of the PA state stores, are checked for underage sales his crystal ball must know something we don’t.  Other control states range from 92-95% age compliance so PA is probably somewhere in there too. That doesn’t keep PA from having a higher underage binge drinking rate and underage DUI rate than most of our border states though.

Now for those huge profits that total under 3/10ths of 1 percent of the state budget. He is saying that if that goes away your local community will raise your home tax bills which I think means property tax.  Why or how he thinks these are tied together I can’t figure out. To finish he adds that this is what Washington state did when they did no such thing.  Housing prices or property taxes didn’t change one bit because of liquor privatization.  The two aren’t related in any way shape or form.

Like any other post put on a public forum (including mine) it is subject to scrutiny and fact checking but even more so when it comes from a person in a leadership position.  In this case Mr. Bond needs to go back and be re-educated again.

(* According to Stacey Witalec, then Director of External Affairs at the PLCB: "... because our stores are not licensed establishments, BLCE does not perform compliance checks in them.")

Privatization IS Modernization.  Accept nothing less.

The Selection Lie

When the PLCB Partisans have made their statements about how dangerous privatization is -- ignoring the fact that it doesn't seem to be causing chaos or undue harm in the states that have it -- and how many jobs it's going to cost -- their jobs, usually, which isn't exactly objective, and ignores the jobs that privatization will inevitably create (if we don't do it the stupid way Senator McIlhinney wants to; yeah, Senator, I said stupid, and if you want to talk to me about it, you already have my email) -- and how much 'revenue' it will cost the state -- which 1)it won't, and 2)that's not the point anyway -- they often get around to saying something like, "And you know, privatization will mean less selection. The private stores don't carry as many different wines and liquors as the LCB does, and supermarkets won't carry a lot of your craft beers; they'll only carry what sells."

Can we just say "bullshit" and be done with it? Because you'd have to be feeble-minded to believe that argument (which really makes me worry about my own state representative, Frank Farry, who actually quoted it to me as the main reason he voted against HB790). All you have to do, quite literally, to disabuse yourself of this notion is go to one of the 160-odd Pennsylvania grocery stores that are now selling beer and look at their beer selection. The Wegmans in Downingtown, for instance, where I bought this bottle of Brooklyn Local 1.

Or you could go to the Whole Foods in Plymouth Meeting, where they even have six taps for filling growlers. But before you make this silly argument, do the really simple thing and just go look at what privately-owned supermarkets are already selling in Pennsylvania! And then stop blathering this ludicrous "talking point" that the state store clerk's union or the Malt Beverage Distributors Association gave you.

It's not just beer, either. Want to see what wine and liquor selection looks like in a privately-run store? Just go look at one! They're right across the border: Joe Canal's, Total, Roger Wilco, Moore Brothers... Are there corner bodegas in the side streets of Trenton that have tiny selections? Sure there are, just like the "grocery" selection at a 7-11 is dwarfed by what you can get at Wegmans, or Giant Eagle, or at an Aldi's, for that matter. That's the point: they don't all have the same stuff, so some of them have a lot more.

But really. If you're making these arguments, or even thinking about considering them as possible...Just. Go. Look. It's all you have to do to realize that they're pure delusion, lies, distortions of truth. If we break open wholesaling in this state -- and it can be the same "system" as the beer wholesalers, they're doing a great job supplying us with multitudes of beers! -- the private stores will get the selection. And it will be the selection you want, not the selection some PLCB committee in Harrisburg has decided you're going to get.

Tell Senator McIlhinney and your state senator that you want real privatization in Pennsylvania: privatized retail and privatized wholesale. If we don't get it all, there's no point. Happily, McIlhinney does get one thing:

"The committee's chairman, Sen. Charles McIlhinney, R-Bucks, also attacked part of Corbett's justification for selling private wine and liquor store licenses, the idea that a windfall of $1 billion or more would result. "If this is about a money maker, I don't think that's really where we should be going with it," McIlhinney told reporters after the hearing. "If we're going to do privatization and try to make more convenience out there, it shouldn't be some way to generate a billion dollars and then give it away."

Right on that one, Chuck. Now get your head straight on the rest of it. Don't compromise with people who aren't going to make a deal.