Stuck In A Bottleneck Liquor Rules Prevent Some Retailers From Getting Hands On Popular Wines

Found a chardonnay you liked on that last trip to California? Now that you’re back home, buying a bottle may not be as simple as going to the nearest store or calling the winery.

Since Prohibition was lifted in 1933, liquor, wine and beer sales have operated through a three-tier system in which wineries sell to distributors who sell to retailers. While Washington retailers can buy directly from Washington wineries, they must go through distributors to purchase out-of-state wines. Thus, the wine you liked in California may not be available here.

The rules, enforced by the Washington state Liquor Control Board, are the same no matter whether the retailer is a liquor store, grocery store or restaurant.

“The distributors are pretty much picking and choosing who they want to distribute to in this state,” said Jennifer DeSimone, co-owner of Spokane wine store Vino! “If I want a wine from a little vineyard in California, I have to talk a distributor into carrying it.”

To further complicate things for retailers in Spokane, some out-of-state vineyards only sell a limited number of cases to area distributors.

“That is very unfortunate, because the Seattle market is so big and they are so wine savvy, they get more wines,” said Michael Grandys, a salesman in Spokane for distributor Northwest Select. “Some upper-end wines are only available in Seattle.”

Small quantities can also mean shortages of popular products.

Some retailers complain that distributors will only allocate the best wines to customers who buy large quantities of wine or particular products.

Grandys said, “We’re not going to say you’ve got to buy this and this to get this.” For example, he said, it’s fair to ask retailers to buy an assortment of wines from a particular winery to get an allocated vintage, but not to ask them to buy things that are unrelated.”

Pauline Riley understands both sides of the distributor-retailer dance. She once worked as a saleswoman for a distributor and now manages the extensive selection at Niko’s wine bar downtown.

Riley calls customers who only want to buy the most popular wines “cherry pickers.” Retailers must be willing to buy a range of wines from distributors, she said.

“You (distributors) may only get two cases of Leonetti (a Walla Walla winery) a year,” she said, “and you can’t have someone you’ve never dealt with walk in and say, `I want Leonetti,’ and you say, `Well I just got two cases in, here you are.’ If you continuously buy, then you are let into allocated labels.”

Dealing with distributors has advantages for retailers. They can order multiple products from one source and have them shipped to their door. In addition, distributors often hold tastings so retailers can make better purchasing decisions.

For wineries, distributors can remove the burden of having to market their wines to thousands of stores and restaurants. But for small wineries, it doesn’t always make sense to involve a middleman.

Knipprath Cellars is one local winery that doesn’t have a contract with a distributor.

“Given our size and our limited production, it made more sense to go out there and represent ourselves,” said owner Henning Knipprath. The downside, he said, is that the winery can’t just focus on making wine; it must do its own marketing.

“It’s like trying to run a second independent business in addition to the winery. It’s very time consuming. That’s offset to some extent by the ability to retain some of the mark-ups that would go to a distributor.”

The wholesalers’ cut is about 18-25 percent of what it charges retailers.

Though no movement is under way to change the three-tier system, Knipprath said some changes have been made in state laws regulating liquor, wine and beer sales. For instance, wineries can now legally sell wine by the glass in their tasting rooms.

Rules aside, the bottom line for all involved in the wine business is quality, said Riley, adding, “It’s all about the wine. If the wine didn’t merit me bringing it into my restaurant, I wouldn’t buy it.”

Around town:

Health club 24-Hour Fitness has broken ground on a new location at 603 E. Holland Ave., at Northpointe. The facility, being built by Vandervert Construction, was valued by the city building division at $1.8 million.

Windermere Property Management has opened an office in Pullman, sharing space with Windermere’s real estate office at 1001 Nye.

Windermere has launched a new “rolling search” service, that allows home buyers to search the company’s home listings with a Web-enabled cell phone. Wireless Internet access to listings has been available to Windermere agents since 1998, but is new to customers. The site, www.windermere.com, gets 20 million hits each month.

Two new stores have opened on the skywalk level of Crescent Court. The Art Company sells prints, sculptures, paintings and frames. The Postal Annex provides shipping services and sells office supplies.

The Sawtooth Grill opens at River Park Square Tuesday, Aug. 8. The restaurant features gourmet hamburgers, sandwiches and salads.