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Is Fabiano Bros. a monopoly? Michigan Beer and Wine Wholesalers say Mackinac Center is off base with reform ideas

Thursday, February 16, 2012 3:05 PM | Anonymous

By Kathryn Lynch‐Morin | klynchmo@mlive.com The Midland‐based Mackinac Center for Public Policy last month issued "Eight ideas for reforming alcohol control in Michigan." At the top of the list: Eliminate the beer and wine distributor monopoly on territory. While James C. Fabiano II declined comment on the issue, he did say the Michigan Beer and Wine Wholesalers Association could speak on the company's behalf. Mike Lashbrook, president of Michigan Beer and Wine Wholesalers, said the Mackinac Center is off base calling any distributor in the state a monopoly. "We always tell people who question if there is a monopoly to go to a major grocery store and walk down the cereal or laundry detergent aisle and see how many manufacturers are represented on the shelves," Lashbrook said. "You'll see those product lines dominated by just a few manufacturers but if you go down the beer aisle or the wine aisle, you will see dozens, if not hundreds of manufacturers represented and that's true competition." The Mackinac Center is calling for the state to change the Michigan Liquor Control Code's requirement that suppliers of beer and wine grant exclusive sales territories to a select group of wholesalers.   "This mandate prevents competition, shackles suppliers and raises costs for consumers," Michael D. LaFaive of the Mackinac Center wrote in his summary.   Lashbrook of Michigan Beer and Wine Wholesalers said the rules as they stand now actually help create competition, maintain strong growth and create jobs. "If you got rid of them, you'd have a negative impact on jobs in this state," Lashbrook said. "If you look at the stability of companies like Fabiano, and their growth, their employment and what they do in their communities, it's due to the system that we have." LaFaive's other recommendations included allowing suppliers to distribute their own products as they wish, removing the Michigan government from liquor wholesaling, and to allow all businesses to apply for licenses for spirits and for beer and wine.   The suggestions, Lashbrook said, would lessen the regulations on alcohol. "Alcohol is a product the public has demanded have a higher level of regulation over," Lashbrook said. "The Mackinac Center believes you should treat it like a box of corn flakes."


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