The National Association of Wine Retailers (NAWR) issued the following statement today concerning Alcohol industry “franchise” laws and the current debate in Missouri over the issue:
“No business in America expects to receive government protection from competition—with the exception of alcohol middlemen,” said Tom Wark, Executive director of NAWR.
“A small group of Missouri alcohol wholesalers insist that they above all others deserve government protection from having to compete in a free market. They are backing up this bizarre claim by clamoring for passage of Senate Bill 365 and House Bill 759, which if passed would make it practically impossible for wineries and distillers to take their business elsewhere if their wholesalers fail to meet expectations or even goals the wholesalers themselves agreed to meet. This is bad public policy and bad for Missouri consumers.
“The members of NAWR work in a climate of hyper competition, be it from brick and mortar wine stores down the street, from Internet retailers or from wineries across the country that pursue retail sales from their own tasting rooms and websites. Yet, these retailers do not demand special government protection from this competition. Rather they embrace it, realizing that better service, a better product mix, more choices, value and hard work are the keys to success. Missouri lawmakers should embrace this basic principle of commerce and reject SB 365/HB 759.
“ ‘Franchise’ laws of the sort envisioned in SB 365 and House Bill 759 do nothing to help the Missouri economy, but rather protect a small group of middlemen while making doing business in Missouri much more difficult for equally legitimate businesses. The state’s retailers also suffer under Franchise laws that give wholesalers virtual lifetime rights to distribute a brand without fear of underperforming. Too often wine retailers are ignored by wholesalers protected by Franchise Laws for the simple reason that wholesalers feel no fear of being replaced by wine and spirit producers when they don’t deliver readily available goods to retailers where consumers can buy them. And where states do have these protectionist Franchise laws, consumers often pay substantially higher prices.
“Political connections, campaign contributions and an entitlement mentality should not translate into political protection from competition. The NAWR urges Missouri lawmakers to reject SB 365/HB 759, and maintain a level playing field for all businesses.”
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