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Wine Distribution in WA & BC: Better Selection for a Fee?

Fresh off a victory in defeating privatization initiatives in WA state, distributors there are asking the WA liquor control board to permit them to charge an \”extra fee\” when retailers buy wine in less than full case lots. Specialty retailers can currently purchase wine in \”mixed cases\” from wholesalers which permits them to offer greater selection to consumers without tying up cash in an inventory of full cases which may sell slowly. Indeed, according to this news report (Wine Sellers Argue New Fee Will Increase Prices for Consumers), more than half of the wine sold in WA state is sold in \”broken cases\”. The specialty retailers oppose the fee because it could increase the cost of hard to find or limited distribution wines.

Here in BC, this issue is a hot topic for retailers and restaurants because the majority of BC\’s fine wine selection is relegated to the \”SPEC\” distribution system. Wines that are listed as SPEC products are not available AT ALL unless a retailer or restaurant orders a full case. Mixed cases are not permitted AT ALL and customers are usually not permitted to split a case between them. Agents (BC\’s equivalent of distributors) have resorted to repackaging wine in smaller cases of 6 or even 3 in order to improve availability but this increases the price of the individual bottles as wholesale handling and storage costs then increase dramatically. As a result of this systemic discrimination, wine selection in BC retail stores and restaurants is poor compared to other jurisdictions. BC retailers and restaurants have long requested that the SPEC system be fixed.

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