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December 11, 2004

Dissent

In response to my earlier post about Sam's, a reader writes in with a dissenting view:

Hi -- I recently read your post on Crescat Sententia about Sam's Wine. I should say this is far from being an example of the idiocies of wine regulation. In fact, it's hardly surprising that they are being investigated by the Illinois liquor regulators. From what little I know of their business practices, they have no problems using their enormous clout with the city to flagrantly hinder competition. And that's apart from their disloyalty to employees responsible for the store's success. While such things may or may not be punishable by the state, I think it's representative of the ethics (or lack there of) which guide their business.

Moreover (and this is the part that forced me to write), you shouldn't really feel pity for Sam's for no other reason than because it's not that great a wine store. They're over priced. And the selection, considering how enormous it is, lacks a surprising amount of quality, to say nothing of value. And the staff is often of little help. Don't get me wrong, I'm a reasonably frequent customer of Sam's. They have a fantastic selection of beer, scotch, whiskey and cheese. And being across the street from Goose Island makes the store all the better. But for wine, there are better places in the city (there are also better places for beer and cheese, but I generally care less about them).

In my opinion, the best wine store in the city is a place called Howard's Wine Cellar. It's on Belmont, just west of Racine. Howard Silverman is the only person who works in the shop. He is also the former head wine buyer for Sam's.

In fact, he was with Sam from the beginning and built it up. Now, clearly he's where I've learned what little I know of Sam's business practices. But before I knew any of that, this was still where I bought all of my wine. Howard has to be one of the most knowledgeable wine persons in the city. And on some regions (like Burgundy), in the country. And he's there at your service every day. I've never come out of Howard's with a poor bottle of wine. Now, the store is not the sort to go browse around in till you find a bottle of wine that looks interesting. Nor is it necessarily the store to look for the hottest wine on the market. It's small and cramped. And one does very well to tell Howard what you're looking for (style, region, qualities, price) and what you like and don't like and have him pick out a bottle (or several). I honestly cannot sing his praises enough, and I suggest you give his store a try.

A few things--

1, I have not been to Howard's Wine Cellar but I will certainly investigate it the next time I get a chance.

2, I personally don't care about whether a store shows "loyalty" to employees who have done good work in the past rather than compensating them up front their contributions. That may or may not be a wise way to run a business, and it may or may not benefit the consumers. So long as the store deals with its employees in an honest manner-- which Sam's may or may not have done-- I don't think an independent notion of "loyalty" necessarily gets it anywhere.

3, I have never been to a store in the Chicago area that had a wide-ranging selection of wines, as Sam's does, at comparable prices. This isn't to say that such a store doesn't exist, just that if it does, I would really like to find out about it. You can check prices at Sam's here. (There are some stores in the Chicago area, for example, that clearly have more esoteric selections or better prices in some specialized area, but I haven't noticed somebody who does better across the board.)

4, If anybody has any hard information or even specific accusations about what Sam's did to "flagrantly hinder competition" I would love to have it, and I will post it here.

UPDATE:

The selfsame reader suggests Wine Discount Center (which I have not visited) as an alternative to Sam's. And also suggests that one anti-competitive thing Sam's has done is to use it's clout to keep Howard's Wine Cellar from receiving a liquor license and thus stop it from opening for several years (I'll emphasize that I have no independent verification that this is so). More information is welcome.

UPDATE TWO:

An off-the-cuff comparison of prices at WDC and Sam's on the wines listed on their websites has yielded identical prices thus far, though obviously not everything can be searched this way, and it's the stuff that can't be searched that is probably important.

UPDATE THREE:

A December 10, 2000 Chicago Tribune article compared Sam's to some internet and area alternatives and found it to fare the best, although it was hardly exhaustive.

UPDATE FOUR:

A different report comes in that of course Sam's gets kickbacks, that many liquor stores in Chicago do, but that what made Sam's easy to catch was that they used the money to pay business expenses and reduce prices rather than line their own pockets. Also, I should add that if indeed a liquore store uses its clout to force governmental barriers to entry on its potential competitors, that's cleary bad, but if all it's doing is arranging for advantageous prices with the dubious wholesalers market and storing its wine in big buildings, I can't see why it's important for consumers to be protected from such "evils".


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