Brewmasters warehouse can't ship within Georgia?

I was purusing BW tonight and saw this on their policy page:

Oops! If you’re shipping to Georgia, we can’t sell to you!

We’re extremely sorry for the inconvenience, but our expansive selection, user-friendly website and outstanding customer service is not available to customers in Georgia.

If you would like Brewmasters Warehouse to open to the local public, and sell items to customers in Georgia please sign a petition and give your opinion about the situation.

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What is going on with that? What rule / law is preventing Ed from sharing within the state? If this has been talked about before, sorry I missed it. My search-foo didn't produce anything either.

Link to page with the info

Link to petition referenced in the quote

I have signed the petition, and if you have enjoyed his wonderful service, or just want to support another lhbs, you should consider signing it as well.

He has an account here (Home Brew Talk - Brewmasters Warehouse). I'm curious too, actually, probably some stupid permit/zoning law

It is not a law. I think I know what the situation is but do not want to spread unconfirmed rumors. I will let Ed explain if he chooses.

But I will say: if people in Georgia want to order from him and can't they will probably turn to one of the other online, flat-rate-shipping stores.

Beerrific said:

It is not a law. I think I know what the situation is but do not want to spread unconfirmed rumors. I will let Ed explain if he chooses.

But I will say: if people in Georgia want to order from him and can't they will probably turn to one of the other online, flat-rate-shipping stores.

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Hopefully Ed will chime in on this then. I understand you not wanting to spread a rumor.

I do honestly feel bad for you beerific. You have a great hbs that is in your own state, and can't even order from him. I hope whatever is causing the situation is resolved so you can use them also.

I don't know about Georgia law but perhaps it has to do with collecting taxes. Usually a vendor would have to collect sales tax for items sold within his state?

Just a thought..

There is really not a lot I can say about the situation. The gist is that new competition came into the area, and not everyone thought it would be best for the home brewing community to have more local competition. This lead to the agreement that I would not sell to customers in Georgia, and therefore not upset the competitive balance that had existed before I opened Brewmasters Warehouse.

I invite everyone that would like to see Brewmasters Warehouse open to the public, and sell things to people in Georgia, please sign the petition!

Edit: This is a matter that deals with protected area within a distribution chain. Please checkout page 6 for a better idea of why/how this agreement started.

Uhhh, that's fairly dumb. If the "competition" can't deal with any competing businesses in the STATE then they really need to reassess the way they do business.

Good on you for making the gentleman's agreement with the other store(s), but allowing your competitors to dictate your business practices right out of the gate doesn't make sense to me. Are they only allowed to sell to Georgia and not outside of it?

If this came from the distributor, then I kind-of understand the limits.

There were more people involved than just the LHBS. The agreement started off fine, but Brewmasters Warehouse has grown so fast, thanks to everyone at HBT, that the agreement has started to create so much confusion and frustration on the part of customers, that I felt the need to give customers a chance to voice their opinions.

Losers says I. This is why monopolies are illegal. That is kinda what they are trying to accomplish (albeit quietly and for their local area). They are being bullies. That is crap and only hurts the market in Georgia. I hope you get enough petitions signed so you can bypass that BS.

Free market capitalism is great unless you actually have competition .

JohnBarleycorn said:

Free market capitalism is great unless you actually have competition .

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LOL. True.

JohnBarleycorn said:

Free market capitalism is great unless you actually have competition .

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Took the words right out of my mouth.

In this country such an agreement is Illegal under anti competitive laws.
It's a cartel and denies the consumer the access to fair trade and competitive pricing.

I'm pretty sure they have laws against cartels in America.

A local landlord (Shops) tried to dictate to new tenants that they should not sell what his existing tenants already sold. The local butcher started selling free range eggs at a good price, the grocer complained so the landlord threatened to cancel the butchers lease if he didn't stop selling eggs. The landlord got fined over £10,000 for that one. Supermarkets have been fined tens of millions of pounds for "Liaising" with each other over milk. http://news.bbc.co.uk/1/hi/business/7132108.stm

Ed, I would check with your legal counsel to make sure this isn't illegal. It sounds like an antitrust issue.

As an aside, I say crush your competition if they can't compete.

There is a limit to the amount of customers in any given area. Here are a few stats I found.

Distance from Alpharetta GA to Marietta GA - [ame="http://maps.google.com/maps?f=d&source=s_d&saddr=marietta+ga&daddr=alpharetta+ga&hl=en&geocode=&mra=ls&sll=34.081953,-84.272003&sspn=0.125399,0.2211&g=alpharetta+ga&ie=UTF8&ll=33.971837,-84.403152&spn=1.059128,1.768799&z=9"]26.5 miles[/ame] (Atlanta area)
Distance from Lemoyne PA to Manchester PA - [ame="http://maps.google.com/maps?f=d&source=s_d&saddr=manchester+pa&daddr=lemoyne+pa&hl=en&geocode=&mra=ls&sll=40.249595,-76.894083&sspn=0.02889,0.055275&g=lemoyne+pa&ie=UTF8&ll=40.14424,-76.808167&spn=0.488142,0.884399&z=10"]17.9 miles[/ame] (Harrisburg / York area)

Population of metro Atlanta - 5,278,904
Population of metro Harrisburg and York areas combined - 1,143,755

Number of successful home brew shops in Lemoyne and Manchester - 2
Number of successful home brew shops in Alpharetta and Marietta (potential) - 2

If the Harrisburg - York area can support 2 LHBS, surely the Marietta Alpharetta area can also.

+1. An agreement not to compete would be legal only if you bought an existing LHBS and the previous owner was going to start a new LHBS in the area.

Fierce competition over prices, supply, etc. is what makes our economy work, COMPETE! I was about to make a large grain order from you the other day but had to take my business/money elsewhere because you can't ship to me. I probably had to take my business to your competitor who doesn't want you to sell in Georgia.

I am extremely certain that this is a clear cut anti-trust law violation/issue (even checked my economics and business law textbooks).

I think I'd be worried if I had anything in writing supporting the agreement not to compete for customers.

Ed-

I just ran this by SWMBO who does some anti trust lawyering and she echoed what Orfy just said. If you entered into this agreement because of pryor employement or ownership it would be ok, but if it is an agreement that says "you take internet and I'll take retail" you and the other LHBS could end up in trouble. Hopefully you can sit down and talk it out with the other parties.

I'm guessing it may have something to do with the wholesale supply chain.

brown_dog_us said:

Ed-

I just ran this by SWMBO who does some anti trust lawyering and she echoed what Orfy just said. If you entered into this agreement because of pryor employement or ownership it would be ok, but if it is an agreement that says "you take internet and I'll take retail" you and the other LHBS could end up in trouble. Hopefully you can sit down and talk it out with the other parties.

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I am not a lawyer nor do I play one on TV, but the situation is much more complex then it seems. I could open the doors and sell to the people in Georgia at any point I would like. I have not because I would end relationships that are very important to the success of Brewmasters Warehouse. The petition is a way for me to continue to have these relationships, and open the doors to people. Home Brewing is a small industry and you can not be successful without the support of everyone in the industry.

That's the problem, you could but have agreed not to.
That is the anti competition bit and that is what is against the law (At least in this country)

You've not only "Agreed" not to chase customers, you've "agreed" to turn away customers. If that happened here it would probably end in court.

It may be a gentlemen's agreement but it's still an agreement.

I don't know the the actual law is in the US but I have been on courses covering the law in the UK and it did cover US cases. The company needed to make sure we weren't inadvertently doing it and also to show due diligence if any individual got caught doing it.

In the UK the law gets very aggressive if a company owns more than 40% of the market in a territory. Punitive fines of up to 10% of turnover of the business can be made in fines plus damages and costs.

I do not know the laws but I am sure that it would be at least a "gray" area. Please understand that I would like to open and sell to everyone. This agreement hurts my business, it does not help Brewmasters Warehouse or the local home brewing community. Although I would love to have the additional business from local customers, my first concern is the harm that this agreement is causing to the local home brewing community. By signing the petition you can voice your opinions about the situation, and help everyone else involved in the agreement to understand that this agreement hurts everyone involved. Others that are part of the agreement, I believe, do not understand that this is bad for everyone including the customers.

I would love to open up to everyone, but opening would risk my entire business and everything I have put into it. Rather than focusing on how this happens, why it happens, if it is legal, please focus on signing the petition and helping Brewmasters Warehouse. Suing everyone else involved for pressuring me into the agreement, so I can stay in business, will only hurt Brewmasters Warehouse in the long run. Who else would like to do business with a company that just sued other businesses involved in the same industry.

Brewmasters Warehouse said:

I am not a lawyer nor do I play one on TV, but the situation is much more complex then it seems. I could open the doors and sell to the people in Georgia at any point I would like. I have not because I would end relationships that are very important to the success of Brewmasters Warehouse. The petition is a way for me to continue to have these relationships, and open the doors to people. Home Brewing is a small industry and you can not be successful without the support of everyone in the industry.

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It appears there is more going on than you can tell us. It sounds like you would be wise to sit down with your friends and work this out. The petition will agitate the locals and force a confrontation. You may not feel like it was you who did the agitating, but the people on the other side of this agreement probably will. Good luck and keep us posted.

It sounds like you need to sit down with a lawyer! The agreement doesn't sound legal, and if you're getting any benefit from it I'd be concerned that you could end up in trouble as well. Best to get this stuff cleaned up now.

Brewmasters Warehouse said:

. . .By signing the petition you can voice your opinions about the situation, and help everyone else involved in the agreement to understand that this agreement hurts everyone involved. . . .please focus on signing the petition and helping Brewmasters Warehouse . . .

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I'll sign the petition. Couple of questions. First, I live outside Georgia, does that matter? Second, can you post the link so I can sign it online? Also, if it doesn't matter where people live, maybe you can start a new thread asking people to sign the petition. This kind of business practice (the "bullying" you into not competing with them is complete BS and, frankly, pisses me off).

This whole thing sounds shady to me. I was going to place my next order through Brewmasters Warehouse, but I think I'll wait until the legal issues are sorted out. Hopefully that won't take long.

the_bird said:

It sounds like you need to sit down with a lawyer! The agreement doesn't sound legal, and if you're getting any benefit from it I'd be concerned that you could end up in trouble as well. Best to get this stuff cleaned up now.

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I am in the process of working with everyone involved in getting this cleaered up as quickly and amicably as possible. I do not benefit from this arrangement in any way shape of form, nor am I happy at all about this arrangement. I could use the help of everyone here at HBT in getting this cleared up by doing 2 things.

1. Sign the petition and voice your opinion.

2. Continue you fantastic support of Brewmasters Warehouse. The bigger Brewmasters Warehouse grows the easier it will be to end the situation.

ArcaneXor said:

This whole thing sounds shady to me. I was going to place my next order through Brewmasters Warehouse, but I think I'll wait until the legal issues are sorted out. Hopefully that won't take long.

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This is exactly the result that everyone else in the arrangement want to have happen. By keeping the business on line and not selling to local customers would place Brewmasters Warehouse in a difficult position to stay in business. If I go out of business then they will win.

This situation does not effect our ability to service customers outside of Georgia in any way. The only people that are effected by this situation is customers inside of Georgia. The shady practices are those of others and not with Brewmasters Warehouse.

I found the petition on your website (buried under a few links). I signed it. If you want more people to sign it (by the response of the posts in this thread, many will sign it), consider starting a thread with a direct link to the petition. I'd bet you will get a lot more signatures that way.

Good luck man.

I don't think any one is suggesting you are benefiting.
I can only presume a distributor/supplier set up the agreement. If so they are probably the one breaking the law and disadvantaging the customers and you.

I can understand you are in a difficult position but it doesn't sound right.

I just signed, I encourage others to do so. Ed is a great guy running a growing business, and I encourage him. I understand what is going on and think it is crap, and it is certainly not of Ed's doing. I can tell you I won't spend a dime at the other location until they back off the distributor and take the pressure off Ed. I'm doing my best not to call other other retailer and giving them a piece of my mind, mostly for Ed's benefit. Were it not for that I most certainly would tell them what I think. I put a link to this thread in my signature, hows that for support! ROCK ON ED!

If we want to support Ed and what he is doing, the simple thing is just to buy more stuff from him so that he makes up for the loss of in-state business. I really don't have much respect for the people on the other side who would put you in a position like this.

Good luck, Ed and thanks for staying in business for the rest of us.

Orfy said:

I don't think any one is suggesting you are benefiting.
I can only presume a distributor/supplier set up the agreement. If so they are probably the one breaking the law and disadvantaging the customers and you.

I can understand you are in a difficult position but it doesn't sound right.

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I do not think it is right, but I am a very small business with limited resources. That makes it very difficult to fight back against "the man". I am hoping that the petition will cause everyone else to realize that Brewmasters Warehouse will not lay down and just accept this highly questionable agreement.

reim0027 said:

I found the petition on your website (buried under a few links). I signed it. If you want more people to sign it (by the response of the posts in this thread, many will sign it), consider starting a thread with a direct link to the petition. I'd bet you will get a lot more signatures that way.

Good luck man.

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At the bottom of the first post in the thread is a link directly to the petition. It can also be found on the website on their policies page. a link to that page is also in the first post of the thread.

I'm sure all on here will help if they can. As stated a quiet chat with the right people may confirm the law is on your side.

Any chance you can say who "The man" is?

p4ck37p1mp said:

I just signed, I encourage others to do so. Ed is a great guy running a growing business, and I encourage him. I understand what is going on and think it is crap, and it is certainly not of Ed's doing. I can tell you I won't spend a dime at the other location until they back off the distributor and take the pressure off Ed. I'm doing my best not to call other other retailer and giving them a piece of my mind, mostly for Ed's benefit. Were it not for that I most certainly would tell them what I think. I put a link to this thread in my signature, hows that for support! ROCK ON ED!

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+1. I put it in my signature too. I can't begin to tell you how upset this makes me.

stevea - I just reread your post, and I found it. Thanks.

McKBrew said:

If we want to support Ed and what he is doing, the simple thing is just to buy more stuff from him so that he makes up for the loss of in-state business. I really don't have much respect for the people on the other side who would put you in a position like this.

Good luck, Ed and thanks for staying in business for the rest of us.

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This is just what is needed. The bigger the business gets the quicker this agreement gets ended.

The best case senario is that Brewmasters Warehouse gets so big that I can walk away from this agreement and open the business up to everyone locally, and not have to deal with the other parties involved again.

Orfy said:

I'm sure all on here will help if they can. As stated a quiet chat with the right people may confirm the law is on your side.

Any chance you can say who "The man" is?

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The original policy had a link to the email address of "the man". It did not last long, as I soon received an email letting me know if I did not take the link down I would be sued. I laughed hard when I read it, but took it down as I simply choose to spend my money giving flat rate shipping and low prices to customers over paying lawyers.

I will not name any parties involved as there are some I would like to have on my side in the future.

What we really need is the information on the companies that are pressuring you into this arrangement. If they break the law and pressure you into curtailing your business to suit their needs, they do not deserve to be protected by keeping silent about it. They need to be confronted and/or reported to the authorities, not asked nicely via petition so play nice and follow the rules.

I will not name any parties involved as there are some I would like to have on my side in the future.

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But that makes you complicit in their activities.

ArcaneXor said:

What we really need is the information on the companies that are pressuring you into this arrangement. If they break the law and pressure you into curtailing your business to suit their needs, they do not deserve to be protected by keeping silent about it. They need to be confronted and/or reported to the authorities, not asked nicely via petition so play nice and follow the rules.



But that makes you complicit in their activities.

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I am not complicit in their activities. If I named all the parties involved then I would be sued by them all, almost instantly. I do not have the resources to defend multiple lawsuits against me, even if they are frivolous law suits. By naming them I would also damage my reputation within the industry, which could cause conducting business very difficult in the future.

Put yourself in the position of a store owner for a second. Many of the products that all home brew stores sell come from a single supplier. If that supplier thinks I will take steps to hurt their business then they can simply refuse to sell me anything. My inventory would quickly shrink to the point were I would lose sales due to a poor selection of products.