Wednesday, February 17, 2010

Spotted in a San Diego Grocery Store

We needed sunblock and diapers, so we drove to CVS, what I think of as a pharmacy, but I now understand is really a grocery store in San Diego. They sell everything, from lawn chairs to perfume to wine.

Something like 35 states allow grocery stores to sell wine, and California is one of them. New York is not one of them, although there is a new proposal that would change that. There have been many such proposals, and all have failed.

I've already shared my opinions on the question of whether or not NY grocery stores should be allowed to sell wine, so I won't rehash it all now. I will tell you, though, that from what I've seen on the shelves in California groceries, well managed wine shops have nothing to worry about. The groceries (and pharmacies, I guess) are selling mass produced wines, wines that are inexpensive and rather common. And for the folks who simply want a bottle of something cheap, isn't it convenient that they can buy it with the rest of their groceries?

The domestic section had a reasonably wide selection of wines, all under $15. The imported wine section consisted of Yellow Tail, and a few other brands. I'm sure that there are Grocery Stores whose wine sections offer more than this one, but even so, I fail to see how something like this could threaten a decent wine store. If this CVS were in NYC, directly across the street from Chambers Street Wines, would Chambers' sales decline?

Chambers Street Wines, and the other retailers in NYC that I count among my favorites, serve a different group of customers from those who would buy wine at this CVS - these are two different markets. Chambers Street is a specialty shop, and they wouldn't be hurt if market regulations are relaxed any more than independently owned bakeries are hurt by bread sales in grocery stores. The bakery that sells Pepperidge Farm and other mass produced bread cannot compete with the grocery store, yes. But a bakery exists to separate itself from the bread masses - they offer a different product to a different customer. There are loads of successful bakeries, some of them chains, others exist as single locations. Some of them are even located near grocery stores that sell bread!

Wine stores that exist to sell half-pints of Georgi, lottery tickets, and jugs of Carlo Rossi will probably go out of business if the legislation passes. But the stores that provide a thoughtfully selected and well priced product will do just fine. Is CVS or Gristedes really going to sell Clos Roche Blanche, Chandon de Briailles, or anybody's Hermitage? I just can't see it. That's wine specialist territory.

A 5 minute drive from the CVS will take you to a little wine store that I've come to like in the few years that I've been coming to San Diego. CVS, Target, Bev Mo, and others are right next door - literally all within a mile of each other. But this place is always bustling. There is always some kind of tasting going on at the back counter, sales people stand in conversation with shoppers, there are high-priced Burgundies and bargain bins alike to poke through, there is a pretty good Champagne selection, and the prices are very good, at least compared to what I'm used to in NYC.

The other night we drank a fantastic bottle of 1996 Fleury Champagne, $55 Terry Theise Selections (I guess Fleury used to be part of the Theise book) that I bought from this store. When in San Diego, if I want to buy wine I'm going to this place. If I need diapers, perfume, a prescription filled, or a lawn chair, I might go to CVS.

Market regulation is a good thing when the normal functioning of a market has unintended or unwanted negative consequences. Like the market for bundled mortgage-backed securities, or the market for coal - those markets, when left to their own devices, produced all sorts of unwanted negative consequences and should be regulated by government. The NY wine laws are the worst kind of market regulation, preventing nothing harmful and existing solely to serve special interests. I hope that one day we can get rid of them.

14 comments:

Anonymous said...

While that selection looks pretty typical for the interstate chains, not everybody dumbs it down and commodifies it. At my local dominant big-box supermarket chain in WA I can get Larmandier Bernier, Pepiere Briords, Musar, Lopez de Heredia, Dard and Ribo, Baudry, Cappellano...
We have state regulated wholesale prices so there is no bulk buy advantage for larger retailers in our system. In this system easier access = better for the producers and better for the consumers IMO.
Brian C

TWG said...

Brian,

How are storage conditions and prices?

Sheila said...

I shop at Rite Aid the selection is about the same. I looked at the wines no way would I bring any of the wines home. In our area a little known Wine Shop is Wenk's Prescription Shop. Hugo does a great job of offering different wines at reduced prices. He will special order any wine you want as long as he can get it.

Anonymous said...

TWG,
I wouldn't buy anything that has been sitting around too long but they are at least cooler than what I consider "room temp". Probably low 60's. Prices are comparable to wine shops and selections varies according to the tastes of the Wine Steward of the specific store. Probably 2/3 to 3/4 of the selections are determined by corporate which is the usual industrial "brands", with the balance being up to the store employee. I prefer to shop at dedicated wine shops but I think there is a value to the industry in having easier accesibility and less intimidation for the consumer. I haven't worked on the retail side here but I think there is plenty of room for a thoughtful and attentive independant wine merchant to compete in this system.
A side perk to shopping the grocery stores here is that they have no awareness of market value for wines, they simply plug it into their mark-up formula based on release price regardless of what the wine goes for on the open market. And it never goes up from there.
just my 2 cents.
Brian

ebw said...

Not to sound like a big bundle of provincial resentment or anything, but out here in the provinces there ain't no Chambers Street and there ain't gonna be anytime ever.

That said, there are a couple of pretty large, well-run, marginally adventurous wine stores in my particular province, one of which even carries a wine from the iconic CRB you mention (05 cot, to be specific). My concern is that places like this depend heavily on the profits from Yellow Tail in order be able to afford to let that CRB sit on the shelf month after month til I find myself in the mood for a glass of cot.

I should add that the above is really just devil's advocating, since the wine store in question is part of the same dynastic retail empire that includes most of the local supermarkets. Nevertheless, I do wonder whether, in at least some places, the kind of stuff in your photos essentially subsidizes the cost of having a small shelf of, say, Loire reds.

In any event, I doubt that these guys will be able to make up the lost revenue from selling snack foods, or whatever the current version of the bill allows them to do.

Frankly, though, for me, direct shipping was the biggie that made life bearable. The current tumult is unlikely to have much of an effect either way.

Steve L. said...

It's a good thing that wine shop doesn't sell diapers or the CVS would lose business.

Anonymous said...

You need to get out of SoCal and check out the grocery stores in Palo Alto and environs: DRC. I kid you not. Where else can you put corn flakes and $1,000 Burgundy on the same receipt?

Château du Petit Thouars said...

Just like to point out that it works in Europe, and that most supermarkets work hard on a really great and wide selection on wines.

Ben Wood said...

Oh, man . . . .
So- I disagree with people, the wine in grocery stores is in fact really, truly bad for wine in NY- I think that it will quite likely harm both the retail side and the winery side of the industry here in NY. I agree with the convenience factor! There are a lot of pitfalls to deal with . . stores with total wine niches will be fine (thirst, as an example), but for us it will be quite hard; though we sell a lot of loire reds, or musar, or CRB, and will be continuing our evolution to a more interesting selection in all areas.

In my opinion it will be unlikely that any stores will make new hires to deal with this - at least at first. They will likely carry large brands, but some in state wineries will suffer (I need 250 cases of your wine for my 25 stores . . . when they might have made 1000 cases and sold already 900) as will small distributors for much the same reasons. Anyway, Just some random thoughts.
Thanks,
Ben

ebw said...

"It's a good thing that wine shop doesn't sell diapers or the CVS would lose business."

Diaper connoisseurs across the land would be wracked with anxiety.

ebw said...

If someone can figure out how to get Larmandier et al into my local supermarket I happily will eat a diaper.

Frederic said...

What little wine store are you talking about?

arul said...

I fail to see how something like this could threaten and the decent wine store.San Diego Limo

Rich Mora said...

I love wine and I love my retail shop but it is a bit patronizing for writers and wine swillers to deem we will do "just fine" (read get by or subsist) if we are cute and quirky. I love selling esoteric wine and special wine but to pay my bills I have to sell everyday wine EVERY DAY. And that quirky stuff doesn't sell everyday. I'm in NY State and the stilted NY liquor laws have been set up so that we sell all the wine and liquor but nothing else and the grocery sells beer and everything else. If you give a darn about having small independents like me around you have to do a lot more than simply give wine to the supermarkets. The whole three tier system has to fundamentally change and that is a lot more difficult than Governor Cuomo glaring down from on high and snapping his fingers. I don't want to spend a chapter on the inviolate 3 tier system but suffice it to say it kills any real buying power for independents (that don't cheat) and insures the politically connected wholesalers, mainly the two big ones make all the money and keep the laws that benefit them. No mystery here its just a little more complicated to fix than You People seem to think.