by Mike Conner » Mon Jul 24, 2006 3:24 pm
Alison,
rant is on and, this is long!
The Pennsylvania Liquor Control Board's monopoly over wines and spirits is such an anathema upon the citizens it serves, it is difficult to know where to start spelling out the issues. And, how beer is managed within the state is also crazy.
Start with beer. Sales to consumers only in a licensed bar/restaurant (or, some clubs which have special rules) by the bottle, or you can purchase up to two 6-packs for take home consumption (the rule is a max of 192 ounces, but must be sold as the pack it comes in, not ounce quantity [so, even though 192 ounces is 16 regular 12-ounce bottles, can only do the two 6-packs as 3 6-packs is more than 192 ounces]).
Or, you can visit a 'distributor' and purchase by the case (four 6-packs). But, only by the case. No 6-packs or single bottles. So sorry for you if you just want to try a new beer. Go to a bar and see if they have it.
And, the number of establishments that sell beer is quite limited (especially in smaller rural areas) - and that most licenses are "transferred" from one owner to another at sometimes $5+ figures which the state condones (the state 'checks' on the new owners of course).
As for wine, the state claims it is the largest purchaser of wines (and spirits) in the country (which is probably true given the volume, since other 'control' state has the sales that PA does, and probably no single wine store/liquor store in the country can match it). But, that buying power doesn't seem to allow the state to leverege its power to getting the best rated wines, nor to have the best prices on the shelf (as some might figure). The buying power is at least partially eaten up by ridiculous state taxes.
How can the state 'allocate' those small production bottlings of highly sought after wines? (there are 69 designated 'Premium Collection Stores' across the state) And, for those that are not deisgnated as the premium stores, how do you spread other smaller production wines across the nearly 550 'regular' stores across the state? My father, who happens to live in an area without a 'premium' store, finds very little on the shelf wine-wise that he would consider purchasing. The closest 'premium' store is almost an hour drive for him, and the store doesn't have as large a selection of 'premium' wines as other locations historically have had.
Then, there's the price issue. Here is how the state prices wine going onto the shelves (not including their 'truckload' or special deal wines):
add 30% markup to the wholesale price
add $1.25 bottle 'fee'
upon this new total, add 18% "1936 Johnstown Flood Emergency Tax" (which was 10% when first enacted, but has since been bumped up twice)
take this new total, round up to the nearest .09 (9 cents).
This is the shelf price of the wine.
Then, when the consumer purchases the wine, an additional 6% PA sales tax (7% in Allegheny County and Philadelphia) is levied.
Example:
10.00 wholesale bottle
30% markup = 3.00
bottle fee = 1.25
Johnstown Tax 18% (upon total of 14.25) = 2.57
gives 16.82. Rounded to the nearest 9 cents gives shelf price of $16.89.
Consumer then pays 6% tax of 1.01 giving grand total of $17.89 for a bottle that cost the state $10 to purchase.
Since I don't work in the retail wine industry, I have no idea if this method of mark-up is good, bad or otherwise. Or, if their supposed buying power translates into lower wholesale pricing before the various mark-ups are applied. Certainly, low-priced wines are likely more expensive in PA (due to the bottle fee and extra tax addition), but perhaps more expensive bottles aren't so bad (although I have not really found many true 'deals' with top wines on the shelf [or, wine-geek wines]).
Next issue is the selection. I have always found wines to try/buy when I have gone into the 'premium' stores (this also takes into account pricing - I tend to be a cheapskate - especially if I know the wine is available to me elsewhere). But, walk in to their 'premium' stores with a certain wine in mind, or even a certain small region in the wine growing world, and you are more likely be disappointed, or end up with a wine from an 'off' vintage.
Although I don't buy much red bordeaux, I always enjoy shopping. IF you find bordeaux on the shelf, it will likely either be terribly over-priced if it is a wine you might be interested in buying, or more likely, from one of the 'lesser' vintages (not that that is always a poor thing). But, it will still have a not very inviting price (likely meaning, the state did not purchase on 'futures' offerings).
Oh - another annoying thing about the state system that often mystifies customers... the tendency to not take vintage into account when sending wines through its system. The state uses a 6-digit number (recently used 5-digits) for its tracking of wines. About 6-7 years ago, it was just 4 digits! These numbers are very often just re-used when the next vintage of a particular wine enters their system. So, if you do try to contact the centralized help desk to try to find a wine that is now sold-out in the closest 'premium' store, there is no guarantee that other locations will have the same vintage! It does appear they are trying to do a better job of tracking vintages in their numbering system.
Just doing a quick search of the on-line wine-location system, shows LCB number 067360, Alter Ego de Palmer for 61.29 per 750ml bottle. No vintage listed. Also, there are two numbers listed in their listings for Amiral de Beychevelle 2000, one priced at $38.89 and another at $34.99 (both 750ml). Which one would you prefer to order? (although given the price, neither).
Oh - if you do have to order something from their 'special liquor order' list, you get to pay UPS shipment cost from the warehouse to your local LCB store.
And, then, there's the general lack of knowledge from most of the store employees. Note, there are a few folks who do try to learn a little bit about wine, and are extremely helpful when you want to try to find a few more bottles from another location. But, unless something has changed dramatically in the last year or so, their knowledge base is similar to any wine retailer who has an employee that has worked about 3 weeks in the store. Not to blame unions, but the employees (unionized) have little incentive to take the time to learn more about the products they sell. It was only about 2 years ago that the state store system allowed tastings in store (this cooresponded to a larger overhaul that added Sunday hours to some locations and allowing wine and liquor accessories to be sold in the stores - previously, you could buy a bottle of wine, but not a bottle opener!).
There are many other little details that fall through the cracks. I still think there is no truly knowledgeable wine person who overlooks the wine buying (certainly, not the fine wine buying). So, I believe PA often becomes the dumping ground for the lesser wines and off vintage stuff that other retailers (through their distributors) don't wish to purchase.
There have been many attempts to get the state out of the wine and liquor business. Since the LCB provides $350million+ to the treasury's general fund (mostly from taxes, but some of it from operating profit), there is little likelyhood that the legislature will abolish it and leave a large whole in their already tight budget. And, if the state keeps the 18% tax for alcoholic products (not to mention the 6% sales tax), what incentive is this for anyone to want to compete as a fine wine retailer (especially given the possible future of even more loose borders for selling wine across the country - which of course isn't going to happen tomorrow, but hopefully, it will come).
Now, the state of PA will allow its citizens to purchase wine from out of state if 1.) it is not listed in the LCB catalog, 2.) you have it delivered to a state store, 3.) pay $4.50 to the state for 'processing,' 4.) pay the 18% Johnstown tax and the 6% state sales tax (that the winery/retailer is supposed to be collecting and passing back to the state), and finally, 5.) show a proper invoice/sales receipt showing the taxes have been paid and such when you go to the state store to get your purchase (of course, you have to be 21 years old....). Simple, huh? Oh - and of course, the person selling you the wines has to have a state license to sell to you... I couldn't find the price to get that license.
OK, rant off
Occasionally, there are good deals to be had at the state store... especially if a wine has already gotten into the distribution channel, and just then gets a high score from one of the big gun scorers . . . case in point a number of years ago was '91 Dominus . . . I think Arpy had given the wine a decent score range when first tasted. The wine was being distributed when Arpy then bestowed a 99 point rating (I think it was 99 points), and the price shot up all over the country. So, if you had not already purchased it, suddenly the price doubled or more. In PA, that doesn't happen. So, my dad and I were able to find some magnums of the wine for $70 per . . . which was less than most locations were selling 750ml bottles for. Another example has been Pegau Chateauneuf du Pape (when/if you could find it). PA has almost always had the lowest price in the country for that wine (up till the 2003 vintage). But, with the high score received recently for the 2003, the PA price now is one of the lowest in the country (if they still have stock). Two years ago, they had on sale the Noval LB 'Finest Reserve' Porto (a yummy non-vintage port made similarly to a late bottle vintage LBV) for $11.99 per. Bought and enjoyed a bunch of bottles! (it was a good price for a very good port IMO).
So, occasionally, miracles happen.
Lastly, although the rant light is not lit, I did want to mention that the state's track record for getting wines from the warehouse to the stores was pretty poor - at least in regard to temperature control. They claim to have changed things, but I can't imagine that every vehicle that delivers wine to the stores is temperature controlled. My father had ordered a case of a tasty champagne after getting a few bottles at one of the 'premium' stores. After opening the first bottle from the case, he noticed it was not even close to being the same wine as the few singles he had bought and drunk. All the bottles from the case were damaged - and he theorized they must have been subjected to extreme cold (it was winter) for some duration of time before he purchased the case (he didn't take them back as they were still reasonably drinkable, and I think there is a time limit for returning wines - if they take back opened wines, that is [I don't know for sure]).
OK, enough. Unfortunately, none of the above really does any good for you Alison... if you really want good wines at reasonable pricing, I'd do my best to shop out of state. There are a few retailers who do go around the state's rules for direct shipping (I shant list them so they will continue). Or, you can make trips to other cities outside the state and make your purchases there and discretely bring them back to your cellar. Both options my father has done. Kinda a pain in the butt, but with limited choices (thanks to a monopoly), you have to improvise. He's also lucky to have a son in a state that does not have a monopoly (although I still suffer being in one of the felony shipping states - which I get around by shipping to NC...) so I do feed him some bottles now and again.
Thanks,
Mike
In search of the perfect QPR wine.... does it exist?
I think you need to go put on your carpal tunnel splint now, Mike!
.
Later I found exactly what I wanted locally.
. In fact I had a rep from one winery tell me in an e-mail that it wouldn't be worth their while to buy the liscence just to sell an additional 3 or 4 cases a year 
! Your best bet? Make plans to vacation in an area with either wineries or the rep to support large and numerous wine stores (like New York or Chicago just as an example) and do some serious shopping while there. Next best is to cross the border occasionally and see what's there (sort of the way my fraternity brothers and I used to bring in fireworks from Ohio).