Will CA Wineries Support their Loyal Customers?

Posted by Tom Wark on Jan 10, 2006

Illinois is one of the most important sources of customers for California’s wineries. And they are about to lose that state as direct shipping market.

Illinois had always been one of those states whose residents could receive direct shipments from California wineries. Even when there were no more than 12 or 13 states that allowed unfettered shipments, Illinois was there, with all those well heeled customers in Chicago and the surrounding suburbs who were willing to buy direct. As a result, wineries tend to have a higher percentage of Illinois residents on their wine club lists and on their mailing lists.

Now that the wholesalers are using their politicians to make their play against direct shipping it will be interesting to see if California’s wineries do anything to protect their customers or if they sit back, do nothing, and leave the battle to the 60 wineries and the citizens of the state to fight the battle for them.

Will the Wine Institute get into the game and lobby the state…or even the Illinois media? Will Family Winemakers of California? What about Free the Grapes, that organization that did so much to help the direct shipping battle in the decade long run up to the Supreme Court decision?

In Michigan, where the last big Direct Shipping battle played out last year it was the media that turned the tide and kept played a key role in opening up the state to shipments, and saving the Michigan wineries right to ship to its own state’s consumers. Editorial after editorial was written by the state’s newspapers…large and small. They pointed to the money connection between the state’s wholesalers and the politicians trying to shut down direct shipping so the wholesalers could have the market to themselves, in a legislated monopoly. This pressure played a huge role, as did he organizations of wineries and consumers in the state that formed to fight the battle.

Does the same situation exist in Illinois? Is there a direct connection between the Wholesalers seeking to end all direct shipping and the politicians that are sponsoring the law? Well It is Illinois.

Consider the three main sponsors of the bill and how important the main backers of this legislation, Associated Beer Distributors of Illinois, are to them:

Rep. Tim Schmitz:
In the 2005/6 campaign cycle Beer Distributors have given no $ so far
In the 2003/4 campaign cycle the Beer Distributors were his #1
contributor.
In the 2001/2 campaign cycle the Beer Distributors were
his #1 Contributor

Rep. Lou Lang
In the 2005/6 campaign cycle the Beer Distributors are his #1 Contributor
In the 2003/4 campaign cycle the Beer Distributors were his #5 Contributor
In the 2001/2 campaign cycle the Beer distributors were his #2 Contributor

Rep. Jay Hoffman
In the 2005/6 campaign cycle the Beer Distributors are his #10 Contributor
In the 2003/4 campaign cycle the Beer Distributors were his #1 Contributor
In the 2001/2 campaign cycle the Beer distributors were his #2 Contributor

And this is just the Beer Distributors. It doesn’t include contributions from the Wine & Spirit Distributors of Illinois, Anheuser Busch, Southern Wine & Spirits or any of the other wholesaler organizations in the state. I think you can argue there is much to work with here in talking to the media about this obscene power grab.

There is a lot at stake for everyone, not the least of which are the Illinois wine drinkers and Illinois wineries. The wholesalers in Illinois clearly understand this. Between 2001 and 2004 the Associated Beer Distributors of Illinois have donated at least $1.6 million to Illinois politicians.

If the Bill passes, no wineries, retailers or wine clubs in America, including California, will be able to ship wine to an Illinois consumer. Illinois consumers will be at the mercy of the wholesalers who will decide what wines to bring into the state. Illinois wineries will lose their right to self distribute to local retailers and restaurants and will be forced to sell wine through a wholesaler. Yet the wholesaler will not be forced to represent the wineries.

Here’s hoping the California wine industry doesn’t leave their customers in Illinois high and dry.