America’s Enemy of Wine Consumers Leaves the Industry

Well, it appears that either the nation’s wine wholesalers have had enough of Juanita Duggan or Juanita Duggan has had enough of wholesalers.

Either way, it is being reported that the CEO of the Wine and Spirit Wholesalers Association (WSWA), the powerful national lobbying arm of the nation’s wine wholesalers, is jumping ship and joining the fight to keep the world safe for paper.

If I had to guess (and I don’t HAVE to, but I am inclined to), I’d say that the wholesalers are tired of Ms. Duggan. Under her leadership the wine wholesalers girded their loins for battle against direct shipping. And what came of their battle against consumer access to wine? Under Duggan’s leadership the nation’s wine wholesalers…

1. Lost nearly every court battle they took part in to stop direct shipping.

2. Lost the most important wine related Supreme Court Case in decades.

3. Found themselves slapped around by the media every time they tried to argue they were fighting direct shipping for the sake of the children.

4. Saw numerous states open their borders to direct shipping

5. Gave this blogger plenty to write about.

I’m guessing the wholesalers gave up on her.

Yet, in all fairness to Ms. Duggan, while she clearly employed a disastrous strategy in fighting against direct shipping, there really wasn’t too much to work with in the first place. The nation’s wine wholesalers have been attempting to defend a patently unfair and immoral system by which states mandate businesses use their services. Their defense of the state’s mandates in their favor were all to reminiscent of plantation owners’ defense of slavery in the 1850s: "It’s for their own good; we can be trusted to look out for everyone’s interest; it’s our God given right."

Duggan is a professional lobbyist who moved from working on behalf of Big Chemical and Nicotine pushers to working with wine and spirit wholesalers. It’s hard to know if she really cared that much about her charges. However, it is clear that she knows her time at the Wine and Spirit Wholesalers Association was not merely unproductive but damaging to their interests. In the press release (PDF)
announcing her resignation as CEO the only items she touts as her achievements after seven years on the job are the "passing the 21st Amendment Enforcement Act and the Domestic Spirits Tax Equity Act."

The mission of the nation’s wine wholesalers today is not simply to stop direct shipping. That horse has left the barn. Now the nation’s wine wholesalers and their national lobbying arm are in a battle to remain relevant in the face of the perhaps the most innovative period America’s wine industry has seen in decades. There are entrepreneurs out there who are fashioning various new methods for reaching out to American wine consumers, and most of these tactics don’t involve discounting their wine 50% for sale to a wholesaler who’s list of winery accounts is too long to count.

The CEO of the WSWA can only do so much to inspire its membership. This person and the organization they head take their marching orders from a cadre of businesses that are ultra conservative and loathe to change in any meaningful way. However, the next CEO of the WSWA really ought to make it their mission to inspire their membership to become marketers again, not merely order takers. This is a tall task. But as more and more wineries find way bypass the wholesaler this unique group of business will need to learn how to deliver added value.

During her seven years with WSWA Duggan acted as though she and her wholesalers were on some sort of moral crusade to save the children of America from the dastardly wineries that only want get youngsters hooked on Chardonnay and Cabernet. At one point she actually uttered these words:

"Consider the recent presidential election that turned on the question
of values and morality. Voters made it very clear they want to be able
to protect their families from some elements of American culture. Just
as they always have, they once again validated the rationale for
controlling alcohol."

Her vital mistake was not the way she held up children to block the bullets flying at her wholesalers. It was her misinterpretation of the times. She mistook the trend toward liberalized trade provoked by the emergence of the Internet for a general attack on America’s wholesalers. This mistake probably cost that industry a half decade in its necessary transformation into a relevent and modern industry.

6 Responses

  1. Rob - July 18, 2006

    Interesting sequence of stories lately

  2. Jeff - July 18, 2006

    Nice reporting, Tom. I exchanged emails with her a couple of years ago when I was doing some research and her email struck me with a moral turpitude that seemed odd, even off-putting in that her moral high road act seemed to be pretty flimsy and out of place.
    Good stuff.

  3. Josh - July 18, 2006

    Good article. Where the distributors can and probably will add value in the near future will be in their ability to target precisly the portfolio of retailers that a producer wants depending on their marketing strategy.
    If they could do this (and it shouldn’t be to hard to set up) and follow through, they would indeed be adding value and earning their SPAs and depletion allowances. The fish in the barrel approach that they use now has to go.

  4. WIneBoy! - July 21, 2006

    Awesome article and a correct review of Juanita Duggan’s WSWA tenure.

  5. sunny - June 24, 2007

    please send me
    who are the enemiesof vine of grapes
    please as i was given the assignment by my faculty

  6. bab - October 4, 2007

    I just don’t have anything to say these days. I’ve just been sitting around doing nothing. More or less nothing seems worth bothering with.

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