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LCB self-dealing: Playing favorites

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Saturday, Jan. 5, 2013

Giving in-house brands it never should have created prime selling locations in stores — an unfair edge over competing private brands — is another way that the Pennsylvania Liquor Control Board abuses its monopoly on wine and liquor sales.

Documents obtained by the Trib via a state Right to Know Law request show the LCB's flagship in-house wine brand, TableLeaf, almost always gets the best sales positions on state-store floors and shelves. In 13 of TableLeaf's first 20 months on the market, it enjoyed one of the top five store spots for sales 17 times — more than any other brand.

And two other in-house brands, Dialed In and LA MERIKA, got top placements for seven months during their first year.

Marketing experts highly prize such positioning, with placement at eye level — where consumers are more likely to notice — particularly important when building a brand. Yet the fact that even this outrageously favorable treatment hasn't necessarily made the in-house brands top sellers does not mitigate how misguided these LCB ventures are.

The LCB makes no more profit on in-house brands than it does on others, so there's no valid financial rationale for this putrid self-dealing. The Commonwealth Foundation's Jay Ostrich puts it well: “Competing for shelf space with government is certainly not what free enterprise is all about.”

And that's one more reason why privatization must end the LCB monopoly.

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