Wine Protectionism Gathers Pace Across the States!!!

Hardly a day goes by without fresh news of job cuts in the wine industry. The current economic situation means that all areas of the market are facing difficult trading conditions. It appears the stores are pacing themselves in a cordinated attempt not to drop too many bombshells all at once.
The undesired effect of drip-feeding the world with news of job losses is that nobody would have had the time to recover from the previous day’s news before being met with a barrage of statistics and job cuts, thus prolonging the depressed mood on the streets.

Today it has been announced that Wine Merchant Ltd’s Creve Coeur store would be closing, Usher’s (yes, Usher the musician) Atlanta wine bar goes bust and Kendall-Jackson’s parent company is laying off 170 employees.
All this in a sector that actually experienced something of a growth in sales in the last year, less that 1 percent, where most other sectors of the economy shrunk.

With all this just the tip of the iceberg, it should come as no surprise that some sections want to protect the market share they currently have. A case in point is the wrangle between the “people of” Massachusetts and a decision by a US District Court Judge. This decision by Judge Rya Zobel found unconstitutional a Massachussetts law that limits the direct-to-consumer sale of wine by wineries that produce less than 30,000 gallons of wine per year and have not used a wholesaler for the last six months.
Well, that sounds quite convoluted, as these laws tend to be. But the issue here really is market share and the need to ensure that indegenious companies are not pushed out of their space by the myriad of smaller scale producers.
On another front, word from New York suggests a renewed effort to stop the sale of wine in supermarkets and convenience stores. The views on this issue vary, there’s a surprise. One retailer is quoted as saying the introduction of this law would drive him out of business whilst another welcomes the advent of competition and thinks it is a great thing to have competition.
The government sees it as a way to help local wineries whilst increasing tax revenue for the state. the police are unhappy with the prospect of easier access to liquor by minors.

Can all this be for the greater good of the industry? The aim here is not to present any solution to this mother of all mires but to highlight how different parts of the industry are dealing with the crunch. The state wants to raise revenue, businesses want to increase revenue and the police want to, well, police the streets. The combined effect of all this is to leave the industry in limbo whilst a decision is being made and the different parties are suing or counter-suing.
What is clear is that each state will go to whatever length it must to ensure survival. Failure to do that will jeopardise more than just one firm but the entire industry as the risk is only few major wineries and retailers will be in existence at the end of this economic trough.
For more information on wine related issues visit http://www.wine-gifts-baskets.com.

Uwa is an experienced and prolific editor of wine infozines. Uwa is the creator of a website dedicated to providing well-researched information on wine matters at http://www.wine-gifts-baskets.com