In my research about the much-loathed Three Tier System of the American alcohol industry, I came across this interesting article. Featured in Washington Monthly in 2012, it explores the agglomeration of the alcohol industry and the vertical integration of the production-distribution-retail model as large corporations break down barriers. The article mostly examines the beer industry, but similar trends can be found in the wine industry. I loved this quote:
"Horizontal integration of alcohol production. Vertical integration of distribution and retail. Loosened local regulations. National chain stores. Streamlined marketing. Volume pricing. Alcohol as an ordinary commodity. America resembles Britain more and more each passing day. How do you like them apples?"
The article also examines the phenomenon from a perspective of curbing alcoholism, in relation to high levels of alcoholism in Britain. While I readily admit that alcoholism and binge drinking are growing problems, I'm less sure that the Three Tier System does much to prevent it. I have a hard time believing raising alcohol prices prevents alcoholics from getting drunk. And binge drinking is a social issue tied to not being raised with a healthy respect for alcohol, the age 21 drinking law, and Millennial "late blooming".
Overall, the Three Tier System helps corporate wine producers and can hurt independent, small-scale winemakers. The incentives are stacked in favor of large wineries who can move lots of standardized product. And those corporations only continue to grow and acquire more labels.
Other non-travel ramblings on wine and business.