Thursday, October 23, 2014

Springfield and Philly. What a difference not having the PLCB makes!

Springfield Mo., "the queen city of the Ozarks." Population 167,000 with an MSA (Metropolitan Statistical Area) of a whopping 450,000. 
Philadelphia, "the city of brotherly love" (and those who buy their booze across borders). Population 1,526,000 with an MSA of 6 million.

Why am I comparing these two places? They both have a whiskey festival, although technically the one in PA is called the Whiskey and Fine Spirits Festival. "Fine Spirits" apparently includes things like Smirnoff Sorbet Light Peach and Ole Smoky Moonshine Hunch Punch, according to the masters of the mundane in Harrisburg.

So what do you get for your VIP dollars in PA? A chance to taste 304 spirits (really only 292, because some are listed twice!) of which about half (151) are something I would call whiskey or whisky. In Springfield you get  at least 200 whiskies and none are called Hunch Punch. You can look for yourself. Here is Philly, and here is Springfield. Not even close, which just shows the sad state that the PLCB is in. If a magazine can sponsor and put together a pretty good whiskey festival in a town the size of Springfield, but the 3rd largest retailer of spirits has to scrape the bottom of the barrel and still falls short, that speaks volumes about how well the PLCB serves the citizens, and what the industry thinks of our backwards system. Yes, I know the Philly Festival is sponsored by a magazine too but they can't do it without the expressed approval and participation of the PLCB.

Look at all the spirits PA doesn't carry. Must be 100 of them -- but they all are available in the free market. Of course, a number of things at the Philly Festival aren't available in PA either, which means if you really want some, you'll have to break the law to get it. All courtesy of the PLCB, who approved all of this. Even the highlights mentioned by the PLCB are laughable. There are only three, and two are for items you can't get. 

I especially like that Stranahan's Colorado Whiskey will be offered for tasting. It isn't carried at all by the PLCB, so the entire state is missing out on some pretty good whiskey. You can't get it if you did like it anyway. I guess they think the drive to State Line Liquors in MD is close enough. Which brings up the question: why even have this at the festival if the PLCB doesn't carry it? If you have no chance of buying some of the things they are offering, what's the point? It really does show how limiting and ignorant the people in Harrisburg are.

Face it, the PLCB is the reason why we can't even have a half-assed whiskey festival. People that do real festivals laugh at the PLCB and us the same way we laugh at somebody trying to buy a six pack at a distributor. You know that is the way it should be done, but somehow in PA it is never done right.

If you want to go to one of these things, plan a trip.  There are numerous festivals in the US, far better than the PLCB ones in Philly and Pittsburgh, plus you have a chance to actually buy the products you taste and give your money to somebody that cares about the consumer.  DC, New York, Boston Vegas, Nashville, LA, Bardstown, Atlanta, and more  As a consumer you deserve the best, so why support the worst?  The Free Market is the only real Modernization.

Tuesday, October 14, 2014

We can't even be better than Utah

There are 2 and only 2 states that completely control the sale of wine and spirits. One is Pennsylvania and the other is Utah. Pennsylvania, the Keystone state, the state where our democracy was formed, one of the 13 original United States of 1776. Utah, 120 years younger, a theocratic territory with a religious background of no drinking,

You would think that Pennsylvania with over 4 times the population would have stores that any large U.S. city would claim. Small boutique stores in trendy urban areas, Specialty stores with unique selections picked out by knowledgeable owners, Mega stores with 30,000 square feet of retail space and 10,000 products in stock. Pennsylvania has none of that. In fact, the Commonwealth has fewer stores per capita than Utah, and even less when you look at the number of stores per drinking age population.

Here is a store in Heber Utah,, population 12,900, that if transported to anywhere in PA would be the 2nd largest store in the state. That is only because the PLCB has opened ONE in the entire state that is larger and that happened only a few months ago.

Is it a fluke?  Something they did to to show off?  I mean, doesn't PA have thriving metropolises of 13,000 people or MORE that could use a store like this?  Not according to the PLCB.  Their cookie cutter approach means that even places that could support specialty stores, Mega stores and boutique stores don't get them. The PLCB doesn't know how to run them, staff them or even sell in them. Our system is so backasswards that "modernization" actually results in LESS products available in a given store size. Why doesn't Philly or Pittsburgh or Scranton or Harrisburg or Erie rate a store like Utah has in Hurricane  (population 13,700).  A store that is bigger than anything in's that work? 

Does their DABC actually pay attention to consumer demand? Are they run by actual business people and not political hacks?  (Not really, their board is as hackneyed as ours) Is it because they have an advisory committee of real business owners, brewers, restauranteurs and health professionals?  My guess is that they are actually more competent across the board and are held more accountable then the people who run the PA state store system. You don't see DABC officials being cited for graft or nepotism or coming up with wine kiosks, or failed "store in a store" ideas.

In another state, New Hampshire just opened two 20,000 square foot stores both larger than anything in PA. We know what a thriving business they have since people actually go to their state stores rather than away from them like in Pennsylvania. In just over 2 years Washington now has over 40 stores larger than anything in PA. That's what happens when you pay attention to consumer demand. We get wine kiosks.

While nobody should suffer under the limitations of states monopolizing what should be privately-owned and run retail...the question is, why do Pennsylvania residents have to be at the bottom?

Privatization IS Modernization.

Tuesday, October 7, 2014

Modernization won't do what the consumer wants. Part IV

Let's look at another failed concept by the PLCB. Although they won't admit it is a failure, when nothing you want comes out of a program it is a failure. Here we have the epitome of customer convenience in the eyes of the PLCB.  Read and then wonder why they ever thought it would work.

Two years ago, in October 2012, the PLCB came up with an eight year plan called "Convenience 2020." This plan was to put a "One Stop Shop" inside a grocery store that already had twisted themselves around to comply with the PLCB regs and then had to overpay to get an "R" license in order to sell beer.  A match made in heaven, since the stores already hate the PLCB for making them go through the added expense and effort of what is a relatively easy process elsewhere.

Is the PLCB, since they "interpret" the liquor code to whatever they feel like on any given day, going to somehow put the liquor and the beer in the same area since the age requirements for purchasing are the same? Of course not! This is the PLCB: convenience is a foreign concept to them. They only go through the motions, because otherwise they would have been privatized decades ago.

In this Pennsylvania nightmare you get your cart, shop for groceries and then make a choice. You can either pay for your groceries and take them out to your car and then come back for your beer; or buy your beer first, and then go shop for and buy a different set of registers. BUT WAIT! You forgot the wine. Now you can go get the wine first because your cart won't fit in the liquor store, pay for it there, then go grocery shopping pay for those, take everything to the car and then come back for beer (or buy the beer pay for it at the beer register and then pay for the groceries). And just think: if it's a hot day, you can leave the wine in the car and have it get heated up just like in the PLCB's trailers!

The epitome of convenience! You get to pay at three different registers inside the same store.

And they wonder why it isn't working out.


Thursday, October 2, 2014

What does it take to wake up the PA Senate?

Something for all the Democratic and RINO senators to think about as they prepare once again to avoid voting for what the plurality if not majority of people want: privatization and de-monopolization of the sales of spirits, wine, and beer.

Privatization does not increase underage drinking.  According to the U.S. Department of Health and Human Services, 29 percent of those ages 12-20 consumed alcohol in Pennsylvania. Compare this to states that have far less government control such as West Virginia (which is also a control state for wholesale) and the number decreases to 24 percent. In fact, the United States average is 27 percent. If government controlled liquor is effective in curbing underage drinking, why are we 2 percentage points higher than the national average and higher than almost all our neighboring states? Why is our underage DUI fatality rate higher than all but one border state?

Privatization does not cause more drunk driving, cause more alcohol related accidents or more alcohol related fatalities. Pennsylvania is once again barely average or worse. In alcohol related traffic fatalities in 2012, Pennsylvania was at the national average of 3.3 per 100,000. If the current government monopoly is better suited for curbing drunk driving, why are we not ahead of the national curve? Furthermore, MADD ranks the states in order of DUI-related accidents per capita. Pennsylvania ranked 35th best – lower than New York, New Jersey, New Hampshire, West Virginia, Virginia, and Ohio. Obviously the median here is 25; Pennsylvania being 10 states away. In 2010 overall alcohol related deaths, Pennsylvania is also surpasses neighboring states. Pennsylvania reported 26 per 100,000 residents. Compare this to 24 in Delaware, 22 in Maryland, 20 in New Jersey, 20 in New Work, and 25 in Ohio.

In the 2 years since Washington privatized DUI fatalities have decreased at a far faster than in Pennsylvania even though they started at a lower rate. You now have a 36% less chance of being killed due to an alcohol related accident in Washington compared to Pennsylvania.

Privatization increases employment. As President Ronald Reagan used to say, “The best social program is a job.” The labor union UFCW 1776 will tell you that privatization kills jobs, but they are wrong. More than doubling or even tripling the amount of outlets for wine and spirits can only mean more jobs. It’s common sense. If anything, the UFCW saying there won’t be jobs for their members is tantamount to saying they don’t believe their members are employable in the private sector. Every locale that has privatized has seen an increase in employment. New warehouse jobs, new delivery jobs, new store jobs. Places that fully privatized tripled employment in the industry. The ability for these employees to use their previous knowledge to specialize in this new industry could actually increase their earning power.

Privatization will increase revenue. A 2010 study commissioned by the Wine and Spirits Wholesalers of America found that 23.6 percent of the wine purchased by consumers in Pennsylvania comes from out of state, resulting in the loss of $17.3 million in excise taxes. A more recent study conducted for the PLCB showed that 45 percent of residents in Philadelphia and its surrounding counties purchase some or all of their alcohol outside of Pennsylvania. The PLCB's own numbers showed that consumers purchased approximately a quarter of their wine and spirits in other states. This border bleed equals more than $180 million in lost sales, and more than $40 million in lost state tax revenue annually from just a handful of counties. These are lost dollars that could fund programs that are essential to our Commonwealth, but that are instead funding Delaware, Maryland, New York, and other border states with lower prices and increased selection.

Decreasing border bleed through price competition, increased convenience, one-stop shopping and increased selection will increase taxes collected. Increased sales will increase taxes collected. Business will pay taxes the current system doesn’t.  More people working will pay taxes. More people working means more sales across the Commonwealth for everything which also means more total taxes collected.

Privatization will remove the inherent conflicting interests of PLCB sales and enforcement. Quite simply, our current system is a house divided. The same entity charged with licensing vendors and enforcing liquor laws is marketing, selling, and producing direct competition with the private companies it regulates (with a surprising lack of consistency). Under privatization, penalties and fines could become much stricter as the PLCB’s conflicted mission would be resolved. In the new, fully privatized system, the PLCB would license, enforce, and educate; which is the appropriate role of government. The troika of party hacks who make the arbitrary and often inconsistent rulings on licensees' questions about application of the Liquor Code could be replaced by experienced regulators, lawyers who do nothing but apply the Code, full-time. The agency would then be run by a director, not a jumped-up "CEO".

Privatization can renew the people’s faith in their government. Distributing and selling liquor should not be in the hands of a state-run monopoly, which is clearly not a core function of government. There has never been a poll that has been in favor of the state run system. Historically, 40 years of polling show the citizens want a change and that change is to a free market system they see working far better in neighboring states. The lack of reform in the face of overwhelming public support leads citizens to conclude that state government is distant, unresponsive to their wishes, and captive to selfish interests. By responding to the will of citizens and consumers, lawmakers can show that Pennsylvania state government listens and responds to the will of the people they are elected to serve.

(Taken, updated and modified from an April  2013 letter sent by the PA Manufactures Association to the Senate)