Wal-Marting of wine?(3)
Or perhaps it's because Southern has done little to cultivate a warm-and-fuzzy image in New York ?or anywhere else ?since entering the state in 2004 with its acquisition of Premier Wine & Spirits.
"Southern's position on everything is 'We'll strong-arm you, and if you don't like it, we'll strong-arm you again,'" said James Merritt of the Merritt Estate Winery in Forestville, Chautauqua County.
Southern's push for market share after the Premier acquisition in 2004 was so aggressive that it spawned lawsuits from in-state rivals. An Eber Bros. suit, for example, claimed Southern used predatory tactics and lured away its employees with outlandish offers.
Industry giant Charmer Industries ?now Charmer Sunbelt ?accused Southern of a "broadside attack on the New York market" that included "commercial bribery, raiding established distribution networks ?and predatory bidding."
Southern denied the claims.
By 2007, Rochester-based Eber had faded to the point where it agreed to be acquired by Southern. Company president Lester Eber, who could not be reached for comment, accepted a job with Southern.
Many liquor store owners say they wish Eber Bros. was still in business, with Lester Eber helping them defeat a proposal they see as a mortal threat to their livelihood.
Eber Bros., they say, consistently lobbied against grocery store wine sales, and was a roadblock against such proposals.
Why? Because unlike national wholesalers, Eber came up through the existing system, and didn't want it to change.
"He was the mom-and-pop of wine distributors," said Craig Allen, owner of All-Star Wine and Spirits in Latham. "And they came in and squished him."
Allen and other liquor store owners insist that wine is the key component of their profitability, and they fear small stores will go the way of the corner butcher or pharmacist if they see the passage of Paterson's proposal.
And that would be good for companies like Southern, they say, because it would save on distribution and fuel costs. The company could deliver wine in a big shipment to one location, instead of being forced to drive to scattered liquor stores.
Some counter that argument by noting that distributors will have more stores to contend with, because convenience stores and drugstores also could carry wine. (Opponents say convenience stores would require infrequent deliveries, at best.)
But more stores isn't a bad thing either for distributors, said Seymour Leikind, a New York City-based liquor industry consultant. What company, of any stripe, wants fewer or limited outlets for its product?
Leikind pointed out that distributors walk a tightrope: They don't want to offend their current customers ?the liquor stores ?so they hesitate to support proposals like Paterson's.
"I think if Eber Bros. was in business today, they'd be for this," he said. "I see no reason why any wholesaler would be against it."
Wine at the grocery?
