Some of you may have heard of the three-tier system of alcoholic beverage distribution. Briefly, it was instituted following the Prohibition Era when it became apparent that regulation was necessary as a response to the lawlessness of the times. The power to regulate the alcoholic beverage industry was given to the states and most states chose to adopt some variation of this system which separates the producer of the beverage from the distributor in the state and again separates those two from the retailer/restauranteur. Coincidentally, taxation was a motivator also with all three levels being subject to taxation before the consumer pays his sales tax on top of the others!
In Georgia our system cedes undue power to the distributor level which can negotiate the cost of a wine from the producer and then set its marked-up price to the retailer. There is no competition on the wholesale level in Georgia. Each distributor has sole ownership of a particular wine brand until he chooses to give it up. This is a primary reason for Georgia's high beverage prices. In the original setting up of the system, by the way, those contending for distributor licenses were chosen by the most widely approved system of our time, the All-American political patronage system, sometimes called the "old boy network", thus providing yet another example of systemic corruption in America.
A producer may choose to terminate a relationship with a distributor if he is dissatisfied with sales or payment arrangements but he then must stay out of the market for five years as a penalty which again reflects state favoritism for the distributor while the sacrifice paid by the producer can be very dear. The trading or selling of labels between distributors is a common practice for commercial reasons or sometimes due to interpersonal difficulties between parties and it's all very entertaining for the impartial observer in an "inside baseball" sort of way. The interruptions in the availabilitiy of brands in the marketplace, while not exactly a hardship, can be an inconvenience to the consumer though.
On Friday September 27th from 5 to 7pm we will be tasting here at the store as usual. With the cooler weather, expect more reds. Please join us us.