New York Winemakers Forced to Market Out-of-State

Scott Osborn–proprietor of Fox Run Vineyards located in the Finger Lakes wine region in New York–poured samples of his great wines at the Gainesville, Virginia Wegmans supermarket last Friday. The store stocks his wines and a host of other New York State wines. Ironically, many resident New Yorkers lack such convenient access to these wines because of their state’s special-interest regulations.

Not only it is against the law for supermarkets to sell wine in the state, the state has a relatively low number of liquor stores thanks to an arduous licensing process and regulations limiting one retail license per person—policies that discourage entrepreneurship. Many–but not all–existing liquor stores support these regulations to reduce competition, and they lobby hard to keep them in place.

To add insult to injury, some existing stores refuse to stock products from political competitors: wineries that advocate supermarket sales. An article in the Wine Spectator addresses how some shops have tried to strong-arm state wineries via what amounts to unofficial boycotts of their wines.

The impacts of such foolish regulations are severe for many wineries. After all, how can any business survive when there are too few retail outlets? Osborn detailed the results of such policies in the Buffalo News earlier this week:

New York lost nine wineries from 2008 to 2009—the only major wine producing state that did not see a net increase in the number of wineries. Our grape farmers are going out of business or being forced to sell off valuable farmland to pay their bills. Also, when wineries go out of businesses, there is a ripple effect that reaches all the way back to the supply companies and small businesses that support the industry. New York’s wine industry will be destroyed if our lawmakers do not do the right thing and open up the markets for us to be able to sell our product and compete.

Osborn and other wine industry groups called on the state legislature to act on this issue at a press conference earlier this week. “This is an issue that is critical to the sustainability and growth of the New York wine industry,” he noted in a press statement. “My wines are sold in grocery stores throughout the country, but not here in my own state,” he explained.

Susan Hayes of Miles Wine Cellars, agreed: “This proposal [to allow grocery wine sales] will help my business grow—creating much-needed jobs here in the Finger Lakes. It will also help the other 1000-plus grape growing farms and more than 270 wineries in New York have more outlets to sell their wines.”

The conference speakers also pointed to public opinion polls showing how residents overwhelmingly support supermarket sales.


However, at least one winery expressed concerns that supermarkets might not carry state wines. But the evidence suggests the contrary. In fact, the New York State-based supermarket chain—Wegmans—already carries a good bit of New York Wine in Virginia stores, which demonstrates that they understand its marketability. Moreover, the legislation could also expand the number of retail shops. More shops, means more shelf space—and more opportunities to market the state’s wines.

I am glad to have Fox Run and other New York wine available here in Virginia! Yet it is a sad state of affairs when a state’s own entrepreneurs have to travel several states away to market their wares. Wine regions usually serve local markets first and then grow to national and maybe even global prominence. But silly regulations mean that New Yorkers have limited opportunity buy and enjoy many great wines produced in their own state.