Deep In The Hearts of Texas Wine Retailers is Fear

Posted by Tom Wark on Jun 24, 2014

FEAR1I’m shocked! Shocked, I tell you!

Is it really possible that Texas wine retailers are attempting to kick out Total Wines & More from operating in their state by attempting to re-open a two decade old lawsuit that ended by the courts telling that state that its requirement that liquor stores be owned only by residence is unconstitutional?

This would amount to Texas wine retailers, operating under the auspices of the Texas Package Store Association, attempting to protect themselves from competition? Could that possibly be? Texans? Those free market, freedom loving folks?

Well, it turns at that following a decision by the 8th Circuit Court of Appeals this yea that Missouri’s residency requirement for wholesalers was constitutionally find and dandy has indeed spurred on the Texas Package Store Association to as for reconsideration of this old lawsuit concerning residency for liquor stores that back in the day went under the name, “The Baby Dolls Case”.

Why reconsider now? Well, it’s not just a matter of another court having a different take on the protectionist residency requirement issue. It also turns out that Total Wines & More has recently and successfully opened up a number of stores in Texas. Total Wines isn’t owned by Texans, but rather by that dreaded species of people known as Marylanders. It also turns out that Total Wine serves the wine consumers better than most of the members of the Texas Package Store Association and to combat their betters, these Texas wine retailers are now looking for the courts to save their butts.

But maybe I’m wrong. Maybe there are principles at work here.

According to Lance Lively (Yes, that is his name), executive director of the  Texas Package Store Association, “We think this is a states’ rights issue.”

“States’ Right”. Whenever you hear someone justify something by referencing “states’ rights”, you can bet they are either looking to protect themselves from having to operate on a level playing field or they want to keep lunch counters safe for white folk. We will have to see how this one plays out.

In the mean time, Ed Cooper, a spokesperson for Total Wine has his own thoughts on the move by the Texas Package Store Association: “There are retailers in Texas who don’t want competition. It boggles the mind that people in a state with a governor who is constantly saying the state is open for business will do something so anti-competitive.”

Ed is being nice. Despite the reputation of Texas, it is the home to the most aggressive effort by liquor folks (both retailers and wholesalers) to use their friends in the legislature and in the courts to stifle competition and save the marketplace for lazy elements of the trade that think competition is a dirty word and fear it like they fear the liberating wind of consumer choice. These elements have regularly opposed winery-to-consumer shipping, retailer to consumers shipping, private labels, and now out-of-state retailers who have proven themselves to be the real friends of consumers.

This move against Total Wine & More as well as against a modern market place is more of the same.

 

Posted In: Uncategorized, Wine Business, Wine Legal Battles

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11 Responses

  1. Rus - June 24, 2014

    Total Wine has started to wake up Connecticut, the home of minimum pricing, no quantity discounts, etc, etc, etc.

  • Bill Haydon - June 25, 2014

    And as a result, you will see consolidation, fewer outlets both among small distributors and small retailers as the large wineries and the large distributors work in tandem to use their money, deals, free goods and preferential pricing to essentially buy the state’s business and drive those who won’t “play ball” into the ground. Ultimately there will be fewer and fewer outlets for small wineries and importers to sell their wine in Connecticut and less choice for CT consumers. But hey, that bottle of KJ might cost a buck or two less on the shelf.

    The fault lines are not so simplistic as Mr. Wark likes to present them and often small CA wineries’ fortunes are much more closely aligned with those of the small distributors than they are with the large wineries such as KJ, Gallo or Bronco.

  • Keith - June 24, 2014

    Since Total Wine does not have to compete against out of state retailers in the safe closed state of Maryland, go ahead and kick them out of Texas!!!

  • Wine Curmudgeon - June 25, 2014

    That is exactly what is happening in Texas, Tom. both with Total and the residency requirement, and in the way the state’s retailers use the legislature to protect their interests. Of course, we aren’t unique in that, as Maryland can attest.

    Total has been so effective in Texas that some wines in Dallas, and even expensive wines, are selling at cost at Total and one or two other chains. It’s a Golden Age for consumers, and a far cry from the way the market operated 15 years ago.

  • John - June 25, 2014

    The wholesalers are a major if not the major donor to both parties. Our wine shipping laws are anti-consumer, anti-competitive, and downright idiotic. Both wine collectors and out-of-state retailers would be happy to pay the state taxes etc to order wines that are largely unavailable in the state, but no the 3-tier system must protect the children. Children, those sneaky bastards, always going to online wine auctions and retailers to get their Cedric Bouchard Champagne fix for the next kegger. Those little bastards.

    In the same vein, here comes the 3-tier system to fight the scourge of out of state retailers moving in. It’s sad because we are so well served and gouged by the stores we already have.

  • John Hilliard - June 25, 2014

    Not surprising, when Texans say Freedom, you have to know what they mean. The Texas revolution was about Freedom…Freedom to keep slaves. Mexicans banned slavery and Texans at the Alamo were up in arms. Total Wine is trying to operate in a state so convoluted that the Govenor openly denies evolution.

  • WineWonkette - June 26, 2014

    When local retailers and distributors in Texas openly talk about how Total Wine & More is going to cut into their margins — I think we know where the motivation for “States’ Rights’ is. Not only do the retailers and distributors have ear of the Legislature, but the distributors often end up regular attendees at the TABC meetings. Which helps them get to know who they want to hire for their legislative affairs jobs. http://allaboutcutting.net/?p=4457

  • Alfonso Cevola - June 28, 2014

    I’m calling bullsh*t on your assertion that “It also turns out that Total Wine serves the wine consumers better than most of the members of the Texas Package Store Association,” Tom. You have no way of knowing that. And while Total Wine has a great service record, there is no need to cast shadows on all the long standing (many mom and pop) stores in Texas who have labored tirelessly for years.

    Stick to the facts and if you dont have them dont make them up.

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