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...

The world as we know it is ending.

It only took 83 years, with five years of us pointing it out, but the PLCB has finally — at least for this month — listed Jack Daniel's correctly across their inventory. There is still one small mistake, but considering how bad it was for DECADES, this is pretty amazing.

Of course, the "adaptive" inventory lookup that the Chairman spoke about well over two years ago still doesn't work.  Don't put in "Jack Daniels" or "Jack Danials" or "Jack Danial's" and expect to find anything...but that's something for them to work on for the next 83 years, I guess. Nope, as of October 2018, the only questionable listing is for item 2419 (the "Jack Daniel's Tennessee Whiskey Family of Brands Combo," a pack of five different airline bottles) which is listed under the category of "Whiskies." Like a catch-all category, except it's one that the PLCB doesn't have. You can't search it on their "Product Catalog," but it does come up on the splashy 'finewineandgoodspirits.com' page. Consistency, guys...

That doesn't mean they're off the hook. There are so many more inventory mistakes to be found, we'll be busy for years to come.

Here's something that made me delve into the PLCB inventory again. I was in New Jersey and bought a bottle of 1792 Full Proof (125 proof) Bourbon. I'm not a big fan of 1792 in general, but a high proof non-chill filtered bourbon isn't that common, even more so at under $50; so I took a chance. Well worth it...if you can find it. So, back to the the online PLCB Product Catalog.

That's never as easy as it sounds. Even the PLCB doesn't think too much of their system, because right in the instructions for using the keyword search, they say, "If too precise, the product may not be returned as expected." In other words, don't put in exactly what you want, put in something close...unless it's Jack Daniel's, because then you have to be exact with the spelling of Daniel's. Which is something the PLCB apparently couldn't do for eight decades. It's tough being a consumer in Pennsylvania.

So I put "1792" into the keyword search box, select "spirits" and hit Enter...no 1792 Full Proof shows up.

OK, I'm used to the PLCB not having most things I buy. But this is pretty mainstream stuff, so I was surprised that it wasn't listed. Well, maybe it just didn't make it through the "good ol' boy" selection process, since it was fairly new. After a month I check again - still nothing. The search page says it is updated daily so if it hits the system, it should show up right?

Wait a minute...I head over to the FWAGS website to see what is there. Sure enough, the Full Proof is an "Online Exclusive." Now, the Online store is technically a store, and everything in it used to be shown in the Product Catalog because, well, you know, it lists "everything." So I randomly search for some things listed as "Online Exclusives" — McKenzie Rye Whiskey, Peerless Kentucky Straight Rye Whiskey, Highland Park Full Volume, and a few others. None of them show up any more. That is helpful in a uniquely PLCB kinda way. Great way to sell product - don't let the consumer find it.  Must be that "control" they always talk about.

I know we don't do much wine here, but...if this is what they're screwing up with a few hundred whiskeys, can you imagine how they're screwing up thousands of wines? The mind boggles.

Hey, PA legislature — are you sure we can't do better?  Privatize.

PLCB buying power is a joke.

Well, it it that time of year again when the Buffalo Trace Antique Collection (BTAC) goes up for lottery. So how does PA fare as one of the largest buyers in the country? Worse than most control states and certainly worst than Total Wine.  Need proof?

Last year PA got an allotment of 165 bottles of George T Stagg, the most popular of bourbons in the BTAC, out of a release of 9.120 This year the total bottling of GTS is almost 29,000 more bottles and PA is getting.....you guessed it, 165 again. Maybe that is just an outlier you say. OK, let's looks at Thomas Handy Rye. PA got 408 bottles for the entire state out of a run of 11,944. This year they are getting 407 from a run of  14,021.

2017 BTAC, although the PLCB says it it 2016, but they are idiots.

Want to try another? Sazerac Rye stayed the same too even though production went up and W.L Weller also stayed the same even though production was up 42% over last year. Yeah I've got the numbers for them too if you really need them. 

So even if the allotments were just divided up by states and foreign sales PA got the short end of the stick by A LOT, It is even worse if you looked at it by a population allocation and we owe it all to the glorious leaders at the PLCB. They should hire some North Koreans, at least they have experience in allocating resources while screwing the public.


Now if you are like me you're thinking that this is what they get for trying to play hardball over purchase prices. We, the citizens and consumers, not only have to pay above list price to the ass-backward PLCB but their newly increased "buying power" gets us LESS of the products we want. Name another business that works like that? You can't - and if one did exist they wouldn't be in business because their competition would make sure they didn't survive.

So just let me say that you guys are doing a bang up job. The more stupid and incompetent things you keep dreaming up to do means the sooner we can be rid of you for good.

PRIVATIZE.

April Inventory Idiocy

I'm a Scotch guy, and I know a fair amount about it. Although they have a statewide monopoly on selling it, the PLCB doesn't...and I'm going to pick on them for that.  How incompetent/stupid/'we don't care' are they this month? Let's take a look.

I'll start off with Glenmorangie single malt Scotch whisky. The PLCB lists 25 bottlings of Glenmo on their website between on-line, in-store, SLO, and of course, "out of stock." So how many do you think you could actually get?

Well, there are nine out of stock, some of which we will never ever see again; inventory padding, really, just like the Jack Daniel's examples I pointed out here. So that leaves sixteen...right? Not exactly. The PLCB likes to double count the exact same item that they have on the shelf...and what they can supposedly only get by SLO.

Here are two examples. First, the Quinta Ruban:

It would seem that cutting and pasting the picture is beyond the ability of the people who do the inventory, and why is the price different? And before you even ask; no, there's only one expression of Quinta Ruban.
 
Next! The Nectar D'Or [a favorite of Lew's ...but not bought from the PLCB!]:

They still can't figure out how to post the exact same picture in two different places, but at least the price is the same this time!

So now we are down to fourteen. Whoops! One is supposedly "Coming Soon," so we're down to thirteen. Now how many do you think you can actually get?

Well, two are listed as "On-Line Exclusive," which may or may not mean you can find one or two in a store. (The PLCB has made that mistake more than a few times.) Are they really there? Looking at the inventory listed in the current Product Catalog, they aren't listed at all, but other out of stock online exclusives are — like the Glenmorangie Signet which the Product Catalog says is available,  but SLO and the FWAGS website says it isn't. So which is it?

Then there is the 18 year old New World which FWAGS says is out of stock but the Catalog says is available. Do these people have any idea what they're doing?

We really don't know HOW many of these are actually available. Who can say, since the inventory, like the rest of the PLCB, is entirely screwed up.

Why do we continue to put up with this incompetently-run "business" which can only make a "profit" with a police-enforced monopoly and by gouging the people they are supposed to serve with artificially high costs and variable pricing?

End the insanity, Tell your Representative to support HB 1075 and get the state out of this mess and back to what is considered normal by the vast majority of the states.

Tracking the Trackers

Real business knows that tracking inventory is important, but the PLCB doesn't.

The faster, better, easier Product Search Page online inventory was recently down for almost four days.

FOUR DAYS! 

What kind of business has their inventory unavailable for four days?  A poorly run and managed one. They could use the excuse that their "other" inventory page (the "Fine Wine and Good Spirits!" page) was available. But look here: if they can't even get the category numbers to jibe on the same page, why should you trust that inventory?

I was looking at Cognac on the Product Search Page when it went down, so I had to use the "Fine Wine and Good Spirits!" website instead, which led me to this page. You'll note that the full number of items at the top is shown as 214; but the total of the available items shown at the left...is 189. Huh?

In the real world of my business, the total items available should match the total in inventory. Listing products you don't have or can't get serves no real purpose except to inflate your numbers when you lie to the citizens (or the Legislature...again) about how many products are available. Something that both the UFCW and the PLCB are prone to do, and we've told you that for years.

Not being able to match numbers on a single page begs the question of where these inventory numbers came from, and why don't they match across online product searches. Take a look what happened when I tried the same search on the Product Search Page once it came back up:

This total, 174, doesn't match 189 or 214, so which is it, PLCB? What random number is closest to what you actually have? I'd bet that none of them are correct, given the history of incompetence at the agency. For over five years they haven't been able to get Jack Daniel's (spelled "Jack Daniel's", see the label to the left!) listed correctly. They have Jack listed in both Whiskey, Bourbon (Straight) and Whiskey (Blended) and use a few different spellings. If they can screw up their #1 seller that much imagine how badly they screw up the rest.You can find your own examples if you think I'm cherry picking. I mean, I am, but believe me, I could pick the whole damn tree for you.

While inventory numbers are important, so is knowing what you are selling. If you look at the above picture again, you'll see it says COGNAC (IMPORTED). Guess what, PLCB: it's all (IMPORTED), because Cognac can only be made in Cognac, France! There is no such thing as COGNAC (DOMESTIC). Ya dopes.

It's just another example of the poor quality customer service that inevitably comes from a monopoly, because they know they don't have to do anything better, since the consumer can't go anywhere else. A real business depends on current, correct and factual information being provided to the customer, because they know they wouldn't be in business if they ran things like the PLCB does.

End the fiasco of fake business and PLCB incompetence - PRIVATIZE.

Almost but not quite

In a surprise move, what can only be called a New Year's Miracle, after over 80 years the Pennsylvania Liquor Control Board has almost learned how to spell Jack Daniel's across its entire inventory, and they almost know what kind of liquor Jack Daniel's is for every entry. 

I've written about the PLCB's lack of inventory skills pertaining to JD quite a few times. I even sent them an email listing every mistake they made, and over the past few years they have slowly fixed most of the mistakes. Why slowly? Who knows, it takes just as much effort to call up the database entry on one listing as it does on all listings of Jack. Then it is just a simple matter of seeing if all are spelled the same, and — just a reminder, because it is the PLCB — correctly. It's Jack Daniel's.

I'm the PLCB. I order it, warehouse it, ship it, stock it, inventory it, and sell it. You expect me to know how to spell it too?

I would think that having a correct inventory would be a fairly important thing, I know it is in my business, especially for my #1 selling item.  However, this is the PLCB we are talking about and they don't seem to think so. If I can ever get them to get all of the Jack Daniel's products spelled correctly I'll start working on getting them all classified correctly. They've had a problem with that for years too.  There is no Jack Daniel's that is a blended whiskey as somebody in the PLCB thinks there is and has thought for well over a year now - just for an example. If I get that accomplished, I've still got years to go: they have hundreds of other mistakes I can use later.

Just one of the many examples of why the PLCB will never be a business, never run like a business, and never satisfy the consumer like a business.

THEY DON'T CARE

It isn't just in inventory, it is in every facet of the organization. Inventory is just something that every citizen can see and track and laugh at their incompetence on a daily basis.

They don't care what you want. Just think about how the PLCB was (and still mostly is) before the privatization push of the past few years 

They don't care what the community wants, as seen by examples in numerous communities, Lock Haven being a prime example. Or how about the YEAR it took to put in a new store in Mountaintop in the same shopping center as the old one. Or the fact that the PLCB can and does force a store into a dry community.

They certainly don't care about convenience. Closing over 20% of the state stores proves that.

They don't care about the consumer. Not having a single highly certified person selecting product for the entire state proves that. Not only don't they have a Sommelier in the PLCB to help select wines, they never have had one unless you counted a part time consultant (and she doesn't work for them anymore).

Privatization fixes all of that, increases employment, allows entrepreneurs to come up with new and inventive products, sales and marketing. Provides what the consumer wants, because if they don't, there is always a competitor who will.  Removes the unqualified from deciding what the ENTIRE STATE is allowed to buy, and increases convenience and selection.  

The PLCB can do none of these things.  Painting a turd pastel colors, putting baskets around it and changing the name to "Excretion" does not change the way the turd got there to begin with. Such is the problem with the PLCB.

Privatization is the REAL modernization.

A PLCB Mystery - The Case (or Ten) Of The Missing Four Roses

Ever watchful, our intrepid sleuth is always on the lookout for ways the PLCB pays lip service to taking care of the citizens. 

On August 21st, Four Roses sent out a press release listing what this year's Four Roses Limited  Edition Small Batch will be, and more importantly, how MANY they planned to make. There was to be a release of about 12,600 bottles total. From what I have learned over the years, about 80% stay in the U.S., and the remainder are for the rest of the world. Can I prove it? No, allocation is a very closely-held card by the distillers and distributors, since there is always somebody who will take issue with it. Needless to say, like any other business, good customers usually will do better than ones that are more difficult (I bet you can see where this is going).

So about 10,000 bottles of this year's Limited Edition were destined for U.S. customers. Dividing up by state would yield 200 bottles per state. Great for North Dakota and Rhode Island; not so good for the rest of us. Allocating by population is a more fair way to guess, and with 4% of the U.S. population, Pennsylvania would get about 400 bottles.

So how many did we actually get? 24 bottles were announced to be sold in a lottery; registration ran from 8 a.m. Oct 26th to 11 p.m. Oct 31st. (No surprise that it didn't actually open until about 8:30 a.m.) But wait!  There's more! Right after the lottery was announced, I wrote a letter to the PLCB asking where all their buying power was and why they had such a poor relationship with the distributor that we got well below what we normally would have. Imagine my surprise when 3 days later, the PLCB announced they had gotten another 42 bottles to raffle off, for a grand total of 66, of which 16 would go to licensees.

No. This is not for you 
silly PA consumer.

Is that fair?  We'll never really know, because we won't know how many bottles the PLCB really had, since they had it listed as an SLO item in August, weeks before the lottery announcement. However, if you called and tried to order it you were told it was a "licensee only" item. So how many were sold to the bars and restaurants the first time, before they got ANOTHER chance? Why did the state get so few to begin with? Is this an indication of what is really thought of the PLCB? Or did the public just get screwed by the PLCB because a normal amount was allocated and they sold it to licensees first?

Also, who is watching all these lotteries?  The PA lottery is certified by outside public firms, the PLCB lottery is...what? I haven't seen or heard about any safeguards in place. Who checks to make sure this is all on the up and up? Are we just supposed to believe them? I'm not saying it isn't legitimate, but I am saying it is hard to believe, when the transparency at this agency is like looking in the Susquehanna after a rainstorm. They certainly haven't done anything to earn my trust so far.

Get rid of the state store system and move Pennsylvania back to normal.



P.S. For those keeping track we reached a small milestone. This is the 400th post of the blog.  It took us seven and a half years to get to this point.  Here is hoping that our job will be done long before we reach 500.

Take my database — please! Inventory idiocy continues.

I'm a Scotch guy, I collect it and I drink it, which means that I look at what the PLCB has to offer and if, by some freak chance, it is something I want, I compare the price to what it would cost me to buy out of state or have it shipped in. (Lots of places will ship to PA and I urge you to search them out.) Needless to say, I've not bought a collectible bottle from the State Store System in a decade. I still keep looking, and the way to look is through the system's website, either the PLCB product search, or the "Fine Wines and Good Spirits Store" (FWAGS). Wait, either? What's the difference? Come along on a search, and learn why the vaunted "convenience" of the monopoly's database of every single bottle of wine and spirits in the state!!! ...is not so convenient after all.

In my crosshairs this time was Highland Park. The online product catalog listed fourteen different Highland Park whiskies, one 'regular,' two 'Luxury,' and eleven SLO-only. Like the last time I looked for something, the "online exclusive" entry is listed as having no stock in the online product catalog. This probably makes sense to somebody at the PLCB but not to anyone with any real business experience. Where else would you be told, "Here is the catalog of everything we list — but don't believe the availability listings, you'd better go over there and check to be sure."

So let's go over to FWAGS and type in Highland Park. Up comes a page that says there are five online, five in-store and 28(!) available by SLO. Sure beats the 14 listed in the catalog. Maybe they haven't cleaned that part of the tens of thousands of bad entries the PLCB admits to having yet. So I look at what is available online. The first one says  Chieftain's Clynelish 14 Year Old, the second one is a Glenmorangie, the third one is another Glenmorangie, the fourth one is a  Mackinlay's...and finally the fifth one actually is a Highland Park. Well, that kinda sucked. 

Let's see what is listed as being in store. The first item listed is a GlenDronach; why, I don't know. The second item listed is the one Highland Park the PLCB actually stocks in some stores and the other three items are the Mackinlay's that were listed as an "Online exclusive!" that also happens to be available elsewhere in a store, and two different sizes of the same McClelland's. Why McClellend's would even show up in a search for Highland Park is another one of those PLCB mysteries that they have somewhat regularly.

I'm beginning to not have any faith that the 28 SLO items listed for Highland Park are really Highland Park. Surprise! I'm right. The entire first page has no Highland Park on it.  Jeez, how bad was this BEFORE they updated the search engine? On to page two where there are eleven Highland Park entries and three more that don't match the search criteria.  But wait, the online catalog says there are 14 and the FWAGS website only lists 13. Which one is missing?  Here it is: "Highland Park and Bowmore Distilleries Double Barrel Blended Scotch Whisky 10 Year Old 92 Proof"  Explain to me why that doesn't show up in a search for Highland Park, will ya? After some digging I did find it; somebody just decided that the name in the catalog wasn't to their liking so they changed it, thus guaranteeing nobody would be able to find it. Or buy it. Wonderful.

The PLCB uses Oracle for their database, which is not a dumb flat file system. Now, the people who program it might not be that swift, or the people above them may not know how or what to ask of the system, but that isn't Oracle's fault. Compare the somewhat worthless search for Highland Park at the FWAGS website with a retailer who has to compete and really provide customer service - Binnys in Chicago (notice they often have better prices too). Binny's doesn't have 24 wrong entries when you search but PA does. The first, last, and all the items are what you are searching for at Binny's, but not in PA — and this is after they claimed to have greatly improved the system. "Modernization" at its finest; a preview of what to expect if  they don't privatize. More lipstick on the PLCB pig.

I guess I was lucky that it wasn't on sale. The FWAGS website spits out a list by type and item number. Who the hell knows PLCB item numbers? How about a list by the alphabet that is actually easy to use instead of this item number idiocy? Just more proof that there isn't a warm body in the entire organization who knows squat about retail. Of course, that is what we have come to expect for the past 80 years so I don't know why I'm surprised.

Oh, and that bottle I was looking for? The PLCB does list it, but I was able to buy it overseas; even after paying international shipping it came to 23% less than the state store price*, and only took 10 days to get here, delivered to my door. Shorter than the 2-4 weeks for SLO, so as long as I had to wait anyway, I might as well save some money. Thanks for nothing, PLCB.

Like all other retail goods it pays to shop around....unless you visit the state stores that are all the same. You don't have to put up with this.  Write your legislators and tell them to support HB 466 so we can finally have what most of the country has - freedom of choice based on what we want and not what the unqualified in Harrisburg allow us to have.

Privatization is REAL modernization.








(* I know it is only a 700ml bottle instead of the 750ml here so the effective price is only 17.5% less but still....)