The Wisconsin Mafia

The Journal has a great article about how the Wisconsin Mafia (Wisconsin Wine and Spirit Institute) is fucking over Wisconsin wineries who want to branch off into brandy making.  The owners of AeppelTreow winery, as well as some others, would like to distill their wines into Wisconsin’s favorite spirit, Brandy.  They would also like the right to sell them directly to consumers, like they do with wine.  Wisconsin law currently prohibits this, and the Wine and Spirit Institute opposes any thing that will cut them out of the picture.  In Wisconsin, and I believe in every other state, we have a three tier system of alcohol distribution.  First the producer must sell it to a wholesale distributor, who then sells it to a bar, restaurant, or retail outlet.  I think that the three-tiered system, established after the end of prohibition, is antiquated and is harming the small wineries and microbreweries in Wisconsin.   While wholesaling may have benefits to larger brewers and also might help established micros break into other markets, their opposition to allowing wineries to sell craft spirits directly to consumers is appalling.  This is not going to cut into their profits.  A brandy made in Praire du Sac or Kenosha County is not going to suddenly stop all Kessler and Korbel shipments into Wisconsin.  The wholesalers only reason for opposing this is because they don’t get their “taste” from the sale.  It seems that the logical solution would be to establish a cap on the volume of spirits sold directly to consumers, like they do in Michigan.  I am sure the mafia would oppose it anyway, but any lawmaker who opposes a compromise will show they are beholden to the special interest money provided by the Wisconsin Wine and Spirit Institute.   Oh MADD is against this too, but MADD has become a fringe group that opposes any legislation that might allow the consumer easier access to booze.

Small breweries, wineries, and distilleries in the United States have to beg and plead with the wholesalers to get their products into stores and bars. Unless they are established, chances are the wholesaler is going to treat them pretty shitty because the small companies have no other options.   I think that is asinine. 

Bell’s Brewery, one of the premier craft breweries in the counrty,  is pulling out of the Illinois market because of a dispute with the wholesalers. In Chicago once you sign up with a wholesaler you are stuck with them, even if you are not happy with the job they are doing.  Recently Chicago Beverage systems purchased the rights to distribute Bell’s from National Wine and Spirits.  Of course they didn’t need Bell’s consent and Bell’s wasn’t ready to give it.  Worried that Chicago beverage wouldn’t be a good fit, Larry Bell just decided to pull out of Illinois completely. 

My solution: abolish any laws that mandate the three tier (producer-wholesaler-store/bar) system and let the market take over.  If breweries, wineries, and distilleries want to continue to use the wholesalers, let them do it, but if producers and stores, bars, and restaurants can work with each other, let them do it.  The consumers will be the ones that benefit in the end.

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