Wednesday, December 9, 2015

Our Goal Is To Be Better Than Utah

The PLCB put out their Fiscal and  Retail Year In Review booklets the other day. Nice to see that they have a goal, and I quote:

"Be recognized as the best-in-class wine and spirits retailer, distributor and regulator in the United States."

Which means that they want to be better than Utah...the only other state (or company) that retails, distributes, and regulates wine and spirits.

They might have to try harder to beat Utah...
The Annual report starts off with listing the Board Members and Directors including my fav, Faith Deihl, who hasn't worked their for a few months now. Don't want to confuse the public by being accurate, after all. It then goes into the whiny phase saying that if the government didn't make them account for all their liabilities, they would have made lots more money. Sorta like you saying your budget is fine until you have to pay your mortgage.

They continue saying how sales went up 4.2%, but what would have been the net (if they didn't have to account for all the stuff they have been ignoring for decades) only went up 2.5%  In other words, even without the accounting changes, expenses went up faster than sales...again.

Continuing to obfuscate reality they almost brag about having 134 different PA wines. However, there are more than 200 PA wineries with well over different 1100 wines and the vast majority of PA wineries aren't carried by the PLCB. The truth has gotta hurt. They also didn't mention why the Department of Drug and Alcohol Programs received 48% less this year, with funding dropping to $1.7 million to educate and prevent problem alcohol use.

The total number of stores went down by one to 603, but since those little One-Stop Shops went up by three, that means four real stores closed. But after 35 years the One Stop Shops hit their highest level ever - eighteen! The PLCB calls that a success.

Another point they don't seem to want to bring up is that Service & Demeanor inquiries went up by 8.4% in just one year. No breakdown this year if they were good or bad. Privatization must be having some effect since salaried employee turnover is up 7% along with intermittent clerk turnover also up 7% to almost 40% now. Finally, the PLCB itself shows that over 45% (an increase over last year) of  their entire workforce are classified as part time or seasonal (page 43), which are hardly "family sustaining" jobs.

Something else they don't say is that while the PLCB offers employees four wine courses, none are recognized by any established certifying agency. Sorta like getting a degree from an unaccredited online school. There still isn't a Sommelier in the entire wine selection process, which one would think should be a requirement when selecting wines for the entire state.  As I pointed out in another post, the PLCB now has 80 "wine specialists" for 603 stores, while Total Wine averages 5 PER STORE. Oh, PLCB, you got a ways to go to be best at anything.

While they try to explain it away, the single most important thing in the entire annual report is:

• Lower operating income of $111.5 million represents a compound annual growth rate (CAGR) of 1.8 percent since fiscal year 2010-11. Operating income has been adversely affected by dramatic increases in benefits costs in excess of sales growth, specifically in the following categories: pension (up 105.6 percent), workers compensation (up 520.6 percent!) and retiree healthcare (up 29.6 percent).
This isn't going to go away either.

Of course, the Retail Year in Review is mostly useless since it only describes what sales are in a police-enforced monopoly where the unqualified select what is allowed to be sold, so that certainly biases what sales would be compared the free market.

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