Liquor dealers object to competition

Alderman Melissa Wynne addresses neighbors at Lincoln School.

Owners of several Evanston wine and liquor stores spoke out at a neighborhood meeting Wednesday night against plans to open a Binny's Beverage Depot on Chicago Avenue.

Alderman Melissa Wynne, 3rd Ward, said she'd called the meeting because she promised to hold one to let neighbors know about whatever new use was proposed for the former Whole Foods site at 1111 Chicago Ave.

But she suggested that, since the property is zoned for such use, there's little likelihood opponents would be able to halt the Binny's plan.

The store would need a city liquor license, which does require City Council approval. But the license review process focuses on the qualifications of the owners to operate such a regulated business.

And, with 38 other stores across Illinois, it appears it would be difficult for opponents to succeed in arguing against Binny's qualifications to hold a liquor license.

Diana Hamann.

"I'm sick about this," said Wine Goddess owner Diana Hamann. "I really do believe I will go out of business" if Binny's opens.

Hamann, whose shop is at 702 Main St., had voiced similar fears in 2013 after Trader Joe's opened at 1211 Chicago Ave. She has also claimed that the city's 6 percent tax on liquor sales is unfair.

Hamann said she can't compete on price with a chain like Binny's that buys in volume and can sell its products with a much lower markup.

Binny's has had a store for years in Skokie, and opened a new, larger store in Lincolnwood last year.

Sandeep Ghaey.

Sandeep Ghaey said that when he was seeking to open Vinic Wine in Evanston, the city's liquor code only permitted package stores in the core area of downtown. It would be unfair to change the rules for Binny's, he said.

However, the City Council has frequently amended the liquor code in recent years to facilitate the opening of new liquor dealers.

When a manager at Evanston 1st Liquors also complained about the potential competition, Binny's CEO Michael Binstein challenged him -- saying he'd never complained when the Evanston 1st owners opened a store in Niles, "within walking distance" of a Binny's.

Michael Binstein.

"I wish I could tell you that beverages taste better when you buy them at Binny's," Binstein said, "but they don't."

Instead, he said, the company tries to offer the biggest and best selection, and hopefully the best prices. "I can't respect the customer until I respect the customer's pocketbook. I don't think you should overpay for anything," he added.

He said the firm has a dedicated workforce, now numbering over 1,300 workers -- and that he planned to hire locally for the new store.

He said he's been looking to open a store in Evanston "for the last 17 years," but had never been able to find the right property and close the deal until now.

"It's not our constitutional right to be here," he added. "We're only here if the community thinks we would add something to the neighborhood."

While most residents who spoke at the meeting sided with the local store owners, several others indicated they are long-time customers of the Binny's store in Skokie and would welcome the chain's arrival in Evanston.

Related story

Binny's eyes shuttered Whole Foods site (11/9/17)

Topic: 

Comments

Binny’s

Competition is good and Binny’s will generate much needed tax revenue for the city. End of story.

I'm still scratching my head

I'm still scratching my head over this misconception on the tax revenue.  Adding another store won't suddenly increase demand for liquor.  So sales within Evanston, overall, would be relatively flat from before to after a prospective new store.  If Binny's per unit cost is lower, then tax revenue (which is a percentage of the sales price) would decrease (the opposite of increase).  I haven't seen any analysis by the city to state that a new store would increase overall in-city sales (probably because it simply won't) so let's not try to spin this as a revenue stream.  

OTOH

Hi Todd,

It's always hard to project the net impact of change. But, among other factors, you are not considering the Evanstonians who -- looking for low prices -- now shop at the Binny's in Skokie. Some of them may choose to patronize the Evanston store instead for the convenience -- even if they might save on the tax bite by continuing to travel to the Skokie store.

You also aren't considering the shoppers from, say, Wilmette, who may be coming here now for Trader Joe's and will make an extra stop here if there's a Binny's next door.

And you aren't considering that we've already lost some portion of the net sales tax from the closure of the Whole Foods. Presumably not all their customers just shifted to the other Whole Foods stores in town. For example, some may now be ordering groceries online -- and are now paying their sales tax to some other locality.

Evanston isn't a hermetically sealed bubble -- we're competing for retail trade across a broader area than just the eight square miles of the city.

And, all other things being equal, the more of that retail trade we can capture, the better.

-- Bill

Fair points, if they are actually true

Bill, I have considered the possible ways the tax revenues could be boosted. However, I think the better way to evaluate changes isn't by the best possible hypothetical benefit. If someone has done an actual analysis to show a net positive benefit, then great. Otherwise, imagining wonderful scenarios or outcomes base don blind hope probably isn't a good way to operate. But maybe I'm in the minority opinion on the benefits of wishful thinking...

Mr. Negative

Hi Todd,

Actually, we have a bit of a case study for this. Sales tax revenue to Evanston dropped dramatically after the two Dominick's stores closed. There were just as many people in Evanston -- but with fewer shopping choices here -- more of them shopped out of town.

Sales tax revenue rebounded when Whole Foods and Valli replaced the shuttered Dominick's.

By your logic, we should never let a new store of any sort open in Evanston because somebody else is already supplying that need here and any new competitor will just damage the business of the existing merchants, resulting in no net increase in sales tax revenue for the city.

Sounds like you're pushing a version on the municipal level of Trump's "America First" trade policies on the global level.

-- Bill

Apples and Oranges

Bill,

I respect your opinion but I don't agree that the comaprison to a situation where grocery stores are lacking and residents have few options is quite the same.  Again, I am not saying that Binney's is a bad thing, only that I'd like to see some actual data to support it (rather than wishful thinking).  Apologies for the disenting voice and dissappointed by the (hopefully inadvertent) need for smear-tactics (invoking the Trump comparison is a shining example of how to shout down any opposing viewpoint).  I'm simply saying I think the small businesses raise some valid fears about how their operations might be impacted.  If the tax revenue from Binney's would offset the losses by other businesses (and potentially further tax revenue losses should those businesses close), my concerns aren't valid.  

 

Special Liquor Store Rules

Bill          

Didn't the City make a special change  to the Liquor Store rules a few years ago by allowing a couple of them to sell drinks by the Glass like a bar?

Yes

Many changes, including those, have been made over the years to accommodate new types of businesses selling liquor and changes to the business model of existing businesses.

-- Bill

Wow-What an unfair headline

This headline is totally misleading. As one of the Evanston retailers who spoke at the meeting last night (Wine Goddess), we each said repeatedly it's not the competition we're objecting to, rather the unfair competition. Binny's is a big-box discount store, the Walmart of booze. I should think if a Walmart was coming to town, our local retailers would get a better headline than "Retailers Object To Competition?" Binny's takes such slim margins, relying on the bulk sales of 37 stores in the Chicagoland area and counting, that the little guys can't compete. In fact, Mr. Binstein said proudly last night that sometimes a bottle will cost him $12.95, and he'll sell it for $12.99. Who can compete with that? Change your headline, Bill. 

No

Hi Diana,

The headline accurately describes what happened at the meetng. The meeting was about Binny's. And that's the competition you're objecting to.

-- Bill

Unfair?

The advantage of efficiency from scale does not seem unfair to me. There are numerous retailers and restaurants in Evanston and elsewhere which use scale to compete. There is no reason for alcohol sellers in Evanston to be exempt from this system.

Just my 2 Cents

Diana, I respect you as a small business owner in 2017. It's not an easy task and it takes a lot of passion and hard work. I don't think this headline is perfect, however your suggested headline would be inherently objective, the use of "unfair" tells the reader how to feel about the news, which is not what responsible journalism is about. Responsible Journalism should tell the facts of a story to better inform the public. Not telling them how they should feel about it. That's up to the reader.

Anyway, I don't understand why your voice seems to be the loudest on this one. If you were at the helm of 1st Liquors, I'd understand the position as Binny's is going for the same market. I guarantee you that people who shop at Wine Goddess are not interested in Binny's and vice versa. You have people signing up for wine clubs that start at $35 dollars a month. They are not going to jump ship to buy boxed wine at Binny's. Meanwhile I am not going to stop paying my gas bill to shop at wine Goddess.

RE: your two cents

OB, I appreciate your guarantee, but having worked 17 years in the wine industry and seeing what Binny's does to independent retailers when they move close by, I disagree with you that it will not have a negative effect on my business. As for why my voice is "loudest," it's because to open the business we took a loan from my husband's 401K for the downpayment on the 147K bank loan and put our Evanston home on the line as collateral. Also, it's my livlihood. Have a good day. 

Lost Opportunity

The economics of adding Binny’s is sound, but the use of the space sadly lacks any creativity or innovation. With three schools within a few blocks of this location, and nestled in a great neighborhood, it would be wonderful to think of what the space could be. Indoor farmers market? Bowling alley? Makers space? Family centered gym? I like a good tax producer, but I like a public asset even more. 

Agreed

I agree with you, I was also hoping for a bowling alley or some other non-retail establishment.  

Trader Joes & $2 mil for a liquor store. Heck of a deal!

I also would like to see a bowling alley there. Evanston council members and the Planning and Development Committee just shot down a cool organic food cafe. It seems though a discount liquor store will meet their approval.

Remember folks, a few years ago Council member Melissa Wynne, the former mayor and city manager all tooted their horns in spending $2 million of taxpayer money to land Trader Joe's across the street from Jewel and Whole Foods. And they all said that three grocery stores in a block radius on Chicago Ave. would work. 

Thanks to Wynne, Wally B. and the other elected officials we are likely getting a liquor store there.  I wonder if our elected officials will hold a huge grand opening ribbon cutting for Binny's as it did for Trader Joes. Evanston politicians hard at work!

Why is bowling ALWAYS brought up?

I love how whenever there is a dark storefront in Evanston people come out of the woodwork advocating for a bowling alley. The old CVS at Oakton and Asbury, the Dempster/Dodge shopping center, now the old Whole foods--all of these sites have been declared by commenters over the years as ripe for bowling.

Sorry to break it to you, people: bowling alley growth peaked in the 1960s. The number of bowling alleys are declining nationwide.

I have nothing against bowling--in fact I love it. But why in the world do people expect an entrepreneur to come in here to invest in a declining market?

Maybe there is a savvy entrepreneur bowling empresario seeking to defy the trend. I hope so. But let's not sit around and wait for her.

I like liquor

Hey Putnam, I like liquor like the next guy. Make mine neat.  But why not try something new? Maybe even make it a non-profit. Give ETHS kids jobs. Hire people disenfranchised by our systems. Invite NU kids down for a few frames, and get them away from all their amazing academic lives. (Maybe NU would even be willing to throw in some Good Neighbor Funds.) Let Binny's run the bar and bottle shop. Ask Blaze to make the pizza.  We, Evanston, seem to be willing to make some amazing flyers with our tax dollars that crash and burn. Why not give this a shot? I'm always up for someone taking big risks for their community (even with a few of my tax dollars). Sorry for dreaming.....Or, sigh, liquor works too.

Did I hear Deli?

Other people have commented that Binny's has an imported foods deli?  Even though our family does not drink, I would be very interested in that and most deli options in Evanston are poor quality or overpriced.  As I recall, Whole Foods had an extensive selection of beer and wine.  As does Jewel Food Stores and the Osco, as does Walgreens.  Have you noticed this?  Walgreens!  It seems that the more great stores and retail and shopowners and restaurants in the neighborhood, the better they will bring in shoppers and stollers.  Some of us remember when this entire section of Evanston was car dealships and rug stores.  Now is better.

Yes, but you heard wrong.

My wife and I also heard this, and as we also do not drink alcohol, decided to check this out. We visted both the Skokie and the newer Lincolnwood Binny's locations for the first time on Tuesday. Alas, we were told in Skokie that there used to be something of a small deli section but that had been gone for some time. Nothing of that sort in Lincolnwood either. Cigars, on the other hand, were plentiful and featured in walk-in humidors. It's too bad that we have a complementary active dislike of the smoking of tobacco, while with alcohol it's just meh.


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