Wholesalers' proposal would hurt wine country

April 22, 2010 

By the Herald editorial staff

Most sellers and buyers are interested in cutting out the middle man and pocketing the savings.

So really, the only one to benefit from a bill that would put an end to direct shipping of wine to consumers is said middle man.

A bill was just sent to committee in the U.S. House of Representatives, HR 5034, that would end the direct shipping of wine between states, regardless of state laws.

As a bonus, it would wreak havoc on lawsuits challenging the existing restrictions that some states put on wine shipments.

It's a national bill, but the impact would be felt in the Mid-Columbia.

The Tri-City region alone is home to 160 wineries. Statewide, the industry directly employs 14,000 people and adds $3 billion to the state's economy.

According to the Washington Wine Commission, Washington wines can be found in all 50 states and 40 countries around the world.

We are the nation's second largest wine producer, we're ranked among the world's top wine regions and are home to the world's best wine, according to Wine Spectator magazine.

Washington wines are also a huge draw when it comes to tourism, attracting about 2 million visitors a year.

Direct shipping between Washington wineries and consumers contributes to that success. For some small wineries, the direct business is crucial.

It's why we're alarmed by HR 5034. The bill would deal a blow to this state, especially to the Mid-Columbia, where so much of the industry is based.

It's not much of a surprise that the biggest supporter of the bill is the National Beer Wholesalers Association (NBWA) -- pronounced "middle man."

Adult beverages are distributed under a three-tier system. Proponents of the bill say that middle tier is necessary to stop rampant debauchery and to keep alcohol out of the hands of minors.

Nice try, guys, but that argument doesn't fly.

The wholesalers have no contact with consumers. They're not checking IDs over at Yoke's.

On the other hand, the UPS driver actually does check ID -- and collect a signature -- when someone buys wine directly from the grower.

Are there ways for kids to get their hands on alcohol, either from the store or online? Yes, in both cases.

Do teens sometimes skirt the law? Yes.

Are many teens going to go to the trouble and expense of mail-ordering a bottle of cabernet sauvignon when it's easier and cheaper to get a six-pack of beer? Probably not.

The real motivation for keeping the middle man in the mix is money.

For the consumer, it's more about choice than money. Customers generally pay about the same price for a bottle of wine whether it comes from the supermarket or arrives at the front door.

But the couple in Oregon who want their favorite Red Mountain merlot shipped across state lines for their anniversary party -- the one that's not available at their neighborhood Safeway -- forget about it, if this bill passes.

For winemakers and wholesalers, the issue is money. The middle man gets a piece of the profits in exchange for distributing the winery's output. In most cases, it's a great business relationship, allowing both to focus on what they do best.

But in a small fraction of transactions -- usually involving wine tourists and oenophiles ordering a few bottles from a small winery -- direct shipments are the only realistic option.

The trade is small enough that the bill wouldn't create a huge shockwave on the state's wine industry, but it definitely would start a ripple that could seriously harm some wine drinkers and makers.

Worse yet, it wouldn't provide any significant benefit for the wholesalers pushing for its passage. Let this one rot on the vine.

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