retail news in context, analysis with attitude

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Hi, I'm Kevin Coupe. This is FaceTime with the Content Guy.

In the town where I live, a local wine merchant recently went public with an op-ed piece that focused on the fundamentals of competition, and why it is important to have a level playing field. He had two points ... but he was only half right.

One of his arguments was regarding a bill making its way through the Connecticut State Legislature that would allow cheese shops to sell wine and beer in addition to bread, smoked meats and, of course, cheese. Now, you have to understand that Connecticut has a puritan tradition when it comes to such things ... supermarkets are not allowed to sell wine, and it is only in the last few years that liquor stores were allowed to open on Sundays.

The merchant says that he's in favor of the bill ... as long as it also allows wine shops to sell cheese, smoked meats and bread. "It’s downright silly to use a legislative body to consider giving one small business an edge over another," he wrote ... and I agree with him.

But that's where he goes off the rails, in my humble opinion. He then comes out against a bill proposed by Gov. Dannel Malloy that would "eliminate the minimum bottle price for wines and spirits and add additional shopping hours for the purchase of alcoholic beverages." He writes that "both of Malloy’s proposals are tax appeasing nods to the big-box liquor retailers that the state is trying to attract. They are also a direct slap at small business entrepreneurs."

I would argue that both proposals strike me as being pro-competition, but not this merchant. No, his position is that the elimination of minimum pricing would put smaller retailers in the position of getting into a pricing battle with big box retailers that they cannot possibly win, and that extended hours would mean that if these small retailers want to compete with the big box guys it would mean "that some member of the family — husband or wife or son or daughter — will be putting in a 96 hour week. They will have to do it to stay competitive." And that, he says, simply isn't fair.

Well, writer William Goldman may have said it best in The Princess Bride: "Who says life is fair, where is that written?"

The thing is that while this merchant is right when he suggests that a change in Connecticut state law could make it very difficult for many wine retailers to survive, he's wrong when he says that the laws should be written in order to protect the little guys. It always has been my view that while survival often is a matter of size, it is not always thus ... and that cunning, guile, innovative thinking and exceptional execution are a far better strategy than protectionist legislation.

The irony of this argument is that this particular merchant may be the smallest of the local wine shops, but they've carved out a singular niche for themselves by not focusing on price, by creating a highly effective wine club, and by identifying and selling wines that nobody else in the area sells.

In other words, they've created for themselves a differential advantage.

That's what retailers have to do, whether they are large or small. Find the thing that makes them unique and different, innovate around it, and exploit the hell out of that advantage. Is it easy? Nope.

There's another moment in The Princess Bride that captures the concept perfectly. It is that point in the movie when Buttercup says to Wesley, "We'll never survive."

And he, of course, responds: "Nonsense. You're only saying that because no one ever has."

There's a first time for everything.

That's what's on my mind this Thursday morning. As always, I want to hear what is on your mind.

KC's View: