Friday, April 24, 2009

Wholesale Protests

The franchised beer wholesalers went on the war path yesterday to protest the expanded bottle bill. As the Journal News reports, the beer guys are targeting the inception date of June 1st, as well as the NY only bar code: "Several food and beverage businesses in the Lower Hudson Valley pressed their case yesterday against the state's newly amended bottle deposit bill, charging it would cost jobs and raise prices for consumers. Dozens of employees from three regional beer distributorships picketed the offices of state Sens. Andrea Stewart-Cousins in Yonkers and Suzi Oppenheimer in Port Chester. Some carried signs that read, "My job is worth more than 5 cents."

The protesters ridiculed the June 1st date-and one, Heinekin USA, made it clear that imported products couldn't simply turn ships around and change inventory at the drop of a hat: "Meanwhile, three other companies said at a news conference hosted by the Business Council of Westchester in Harrison that the June 1 deadline for implementing the new rules was unworkable. "If we had a magic wand, maybe," said T. Daniel Tearno, senior vice president for Heineken USA Inc. of White Plains. Overseas manufacturers such as Heineken need time to retool their production processes, he said, and many warehouses are stocked with products that cannot be relabeled before the summer."

And then there was the issue of prices rising: "Tearno said the law could raise the price of a case of beer by $1.35 to $2 or more. Mitch Klein, a vice president at Krasdale Foods in West Harrison, said the markup on a case of bottled water resulting from new deposits and fees could top $3." Not all the clamor on prices and costs, however, was righteous.

Here's the franchised beer position: "But D. Bertoline & Sons in Peekskill, the distributor of Budweiser beer products in Westchester and Putnam, uses unredeemed deposits to pay the costs of shipping recycled products to Connecticut, Vice President of Administration John Bertoline said. That lost revenue, plus higher handling fees and a higher beer excise tax imposed by the law, will lead to price increases that get passed along to consumers, he said. That would depress sales, which in turn could reduce employment, he added."

Well, let's get one thing very clear. We were right there when the bottle bill first passed and went into effect in 1981; and the beer wholesalers wasted no time in raising the price of beer by at least $3.00 a case-all for the increased costs associated with implementing the collection and redemption of the empty containers. So now what?

Well, now these very same wholesalers-insulated from real competition by territorial monopolies-want to once again meet the cost of redemption by jacking up the price of a case of beer by another $2! What about the millions of unredeemed deposits that these folks squirreled away over the past twenty seven years? If beer prices are raised, there should be an intervention and investigation by the AG's office into the anti-trust implications of the wholesalers' actions. Additional costs indeed!

That being said, it is simply ludicrous to force all of the deposit companies to use the separate "NY Only" UPC: "Legislative leaders and Gov. David Paterson acknowledged Wednesday that they would need to revisit the bar-code issue, saying they may need to add an amendment to the law over the start date. "We don't want to do anything to hurt the industry while we are trying to clean up the environment," Paterson said."