Edina: Tax increase is Total Wine’s fault

There’s quite a spat in Edina over what’s behind a proposed 7 percent increase in the city’s tax levy, Minneapolis/St. Paul Business Journal reports.

In a mailing to city residents, Mayor James Hovland blamed the citizens’ choice of booze, or, specifically, where they bought it.

Edina is one of several Minnesota cities that runs its own liquor store and until the upstart Total Wine moved in, it made plenty of money doing so, the mayor said.

Our 2015 budget projected Edina Liquor revenues of about $1.8 million. Now in a completely different market than the one we were in when the budget was crafted, we are doing what we can to bring in half that amount.

Edina Liquor is still very much a profitable business and one that we are proud to operate. However, we can no longer count on beer, wine and liquor sales to support the City budget in the way it did before the market changed. Without the expected transfer of Edina Liquor profits, we must raise municipal property taxes by about 7 percent to keep City services at the current level next year.

The mayor said the city can be proud of the fact that Edina has the lowest taxes on a $400,000 home of any comparable community.

Total Wine says sales were dropping at the municipal liquor store before the discount chain opened at France Ave., and Interstate 494 last November.

“When the city of Edina blames Total Wine & More for falling profits at its municipal liquor stores, the city is really blaming Edina residents and other consumers who are not spending enough money at its government-owned stores to meet the city’s profit projections,” Total Wine Vice President of Public Affairs Ed Cooper told the business journal.

  • wjc

    Too bad. So sad. I do like the Total Wine stores. Great selection. Great prices. Very helpful people. Edina: Need cheese with your whine?

  • Personally, I just stay away from Total Wine in favor of keeping my $$ at the local level…

    • wjc

      I might be inclined to agree with you if the selection, prices and customer service were at least comparable. My local level retailers score 0 out of 3.

      • Joe

        If you’re in Edina go to France 44 or South Lyndale Liquors. Both better selection, comparable prices and better customer service.

      • Agreed. Mine scores 3 out of 3 for me.

        /McDonald’s Liquors in S. Minneapolis

        • wjc

          I’ve been to McDonald’s. Not a bad store. They have probably 1/20 of the selection of Total Wine (if that) at around $3-5 more per bottle (if not more). No employee has ever been in the wine section when I have been there.

      • Tim

        I’ve found TW (or at least the one I shop at) to be great at the third of those, good to okay on the second, and a mixed bag on the first.

        As Jeff noted below, the prices depend somewhat on the item — the popular items have good prices, but less popular items aren’t always better than elsewhere.

        In regards to selection, it depends. Their wine selection appears to be excellent, but I’m not a wine enthusiast and thus am not sure if I can really judge; I’ll buy it once in a while for a special meal or a party and that’s it. Spirit selections are wide-ranging, but I haven’t liked their house brands that I’ve tried; I find it’s better to stick to established brands. Beer is the weakest part of their selection, IMO — lots of places around here do better than them and I don’t know if they really understand the local market yet.

  • Gary F

    Total Wine is using their buying power to their advantage. They have forced the big distributors not only to deliver the product to their stores, but job the shelves, just like the chip and snack vendors do at the grocery store. But, the problem is, Total Wine is not paying for this extra service, so besides getting a bigger volume discount, they can hire less people than a mom and pop would. Mom and pop shops pay more, and have to pay people to stock shelves.

    Buy at your independent store, or they won’t be there that long.

    Muni’s? Why should the government be in the retail business anyways.

    • Jeff

      I’m in the business. We don’t happen to sell to Total Wine, but I’ve heard the same thing. Reps complain that they spend more time stocking their shelves than selling product. However, I hear from my partner that the independents are starting to follow suite and at least one makes her stock their shelves.

      Total Wine is the bogeyman for the locals. However their prices are good on some popular items but get off the beaten track and they can be more expensive. I recommend frequenting a good local shop. With wine if they know their stuff they can save you money by pointing you towards something you will like. I’ve heard TW employees aren’t very knowledgeable and might have an agenda.

      I have socialist tendencies but I couldn’t agree more, government should stick with it’s core mission. They also create a local monopoly, which is never a good thing. I don’t like the lottery either.

      • wjc

        My experience is that Total Wine employees are in fact very knowledgeable. The last time I was there, I received a couple of excellent recommendations for moderately priced and quite excellent wines.

        TW has clearly shaken up the market, and I think it is generally for the better. I’ve been to France 44 and many other “premium” stores and I have not been overwhelmed by their prices or product knowledge. You want my business, do better.

        • Kurt O

          TW has much better service than any of the Mom + Pop’s I’ve gone to around here. Big Top is good too.

    • jon

      Economies of scale, it’s how walmart manages to keep their prices so low, how total wine manages their stores, and how pretty much every other company in existence functions.

      But that’s the free market for you.

  • Leroy

    I’ll stop shopping at total wine when our local liquor stores stop lobbying against Sunday liquor sales.

    • permalink

      Best comment yet!

  • toyboata-friend of the pod

    every day i need attention 🙂

  • Vince Tuss

    Maybe the munis can break the Sunday sales ban by pushing to allow only municipal stores be open on the seventh day?

  • johnepeacock

    This couldn’t highlight any clearer the fact that a municipality shouldn’t be in the liquor business. Or any other retail business. Don’t complain when your business model becomes dated. Regular businesses do not have that allowance. Muni’s shouldn’t either.

  • I guess instead of paying $71 more in property taxes for my home every year and get nothing, I’d rather pay $140 more and get 7 bottles of wine. Is that how this works?

    • Mike

      If they delivered I’d pay $200. 🙂

  • tboom

    Ok, so maybe the Total Wine business model is going to blow-up the liquor business. To me it’s just another example of the big box model offloading payroll to suppliers and making do with low-wage/no-benefit/part-timers to keep the doors open. If a municipality can gain some revenue from a highly regulated industry (an industry it plays a part in regulating via liquor licenses) go ahead. As to competition, it’s not like Edina’s munis have ever been the only place to buy a bottle.

    Edina’s controversy is another matter. The way I read it, Edina has lost half of $1.8M in revenue ($900,000 less revenue), which will result in a 7 percent increase in property tax. Without looking at Edina’s books, you expect me to believe Edina’s total budget is $12.9M ($900,000 would be approx. 7 percent of $12.9M)?

    • jon

      Are you suggesting $12.9m is high or low?

      They have a population of something like 47k, assume 2.5 people per household, multiple by $2k (roughly my property tax on the north burbs for a town with out municipal liquor, and for a house worth less than most of them in Edina) that’s $37.6m… Now that didn’t take into account non single family homes or businesses.

      Just a quick attempt to get a ball park number.

      • tboom

        Wasn’t very clear. $12.9 seems very low, implying a 7 percent increase would bring in way more than 900K.

  • Mike Worcester

    Why are there Muni’s? We can thank our collective hangover (pun intended) from the aftermath of Prohibition, when the state wanted to do a better job regulating the liquor trade since prior to Prohibition off-sales as we think of them now — or package stores as they were called when I was growing up — did not exist. In other words, it’s a historical throwback.

    In addition, it would be interesting to overlay a map of the locations of munis (there is a great map in the Auditor’s Report just released) and see how many of them are in house and/or senate districts with more conservative-leaning representation. For the ones in my part of the state, that is definitely the case.

  • John Glas

    I find this to be a joke. Edina has plenty of money and find many ways to waste their money on fancy streets with landscaping. It is about time they redeveloped Braemar Golf Course as it is a great location but pales in comparison to Willengers and Bunker Hills in the same price category.
    Total Wine has ok service. They try and sell you their brands which are highly profitable. Just because someone says can I help you does not instantly mean they have great service.
    Why would anyone pay $15 for a bottle of wine when you can get it at Total Wine for $10?
    The best wine shops in town are Surdyk’s (on sale), Hennepin Lake, Winestreets (on sale) and Big Top has a great Tuesday Dash email blast. Some of Haskell’s sale items are solid but many of the listed shops below I avoid due to high prices.

  • John Glas

    Interesting. Gloria Ferrer Sonoma Brut is a nice under $20 Sparkling wine. France 44: $19.99, Total Wine $16.97, Edina Liquor ? terrible website to promote their products and on sale at Haskell’s for $14.99. Can’t figure out why I would want to pay France 44 $5 for a bottle of inexpensive Sparkling wine.

    • Joe

      Just looked up 5 of my go-to wines, all roughly in the $20-$40 range.

      France 44 had 4 out of 5 of them.
      Haskell’s had a different 4 of 5.
      Total Wine had 3 of 5.

      Of the 3 that Total Wine had, 1 was cheaper than France 44 (same price as Haskell’s), 1 was the same price at all 3, and one was more expensive than France 44 and Haskell’s (France 44 had the best price). Buying those 3 would have been $82.65 at Haskell’s, $83.48 at France 44 and $86.97 at Total wine.

      Which matches my broader experience. Different stores have some prices higher, some lower, and some the same, and all have a different selection. I don’t normally shop at Total Wine or Haskell’s, but certainly have occasionally. And have shopped at many other liquor/wine stores. Location, service, presentation and atmosphere matter more than selection and price because no one place has everything I want anyway, and saving 83 cents on an $83 purchase (1%) doesn’t really mean much.

      • John Glas

        If they are not on sale at Haskell’s they will be as high as France 44.