There is a human factor to the debate of wine in grocery stores.
After prohibition ended, liquor and wine stores were set up to not be able to grow to the mega-size of Wal-Mart and Wegmans. Owners have been happy to play by the rules of the state, selling only wine and liquor, opening and closing when told and under strict guidelines about payment to distributors.
Owners, their families, and employees have built the wine industry in this state, working with local wineries, providing great service to their customers, and providing valuable jobs. Now because of a budget gap and pressure from Wegmans, the governor has proposed opening wine sales up to grocery stores.
Wine stores can sell only about 1 percent of the products that the grocery stores and big-box stores sell, and opening up wine sales would kill retailers who have worked hard to get where they are.
The state is turning its back on small business for a one-time fee paid by grocers to sell wine. What about the stores, the owners, families? Not to mention the small and midsized local wineries that are going to get shoved aside for the foreign giants of the wine world and the distributors who do a great job of servicing the stores.
Wegmans says this is great for consumers, but as the number of wine stores goes down, so will the selection that Wegmans carries. Wegmans has 75 stores, restaurants, and pubs, and sells everything under the sun, including wine in other states. Now Wegmans is after a change in state law so they can add a bigger piece to the ever-growing pie.
We all love Wegmans for their groceries, but how many families have to lose so Wegmans can make even more money?
MATT STRASSMAN, ROCHESTER
Strassman's family owns a liquor store.





Comments for "WINE SALES: We lose with wine in grocery stores" (26)
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Colleen said on Mar. 10, 2010 at 7:52am
Now I wish that they would print articles like this in the D&C to give a true understanding of how this change will negatively affect those who own Wine/Liqour stores. I do not agree at all that any change should be made. I fully support any local business and enjoy the experience shopping at them. I encourage everybody to check out your local wine store, meat market, public market! I have saved more money and eaten healthier since I have stopped supporting Wegmans. Spread the word...NO Wine in Grocery Stores!!!!!!!
Mom and Pop Winery said on Mar. 10, 2010 at 9:56am
I'm sorry, but the wineries have built up the wine industry in this state. I appreciate that the liquor stores sell the wine, but that is the only venue wineries have, outside their own tasting rooms, in NY. So to say they built the industry assumes too much for me. As far as battling the giants... we do that already at the liquor stores. What's the difference between them and the grocery stores? I own a very small winery that has been open for 15 years and it is hard as heck to get in to liquor stores. I don't see how the grocery stores will be that much harder. Would this author be more willing to support WIGS if the liquor stores were offered more? Well they may have gotten more if they had come to the table to negotiate. Instead their motto was "no compromise". I firmly believe that more wine drinkers in New York State will benefit our industry! Change is hard, but it makes us all the better!
Carol said on Mar. 10, 2010 at 11:12am
Mom and Pop Winery: You are so right.
The whole NY economy needs grocery stores to be able to sell wine to let the NY grape and wine industry grow. Wineries are a mainstay to the tourist business that brings billions of dollars into NYS. The tourist industry will grow too if there are more wineries for people to visit - as it has in CA, WA, OR and the 32 other states where wine can also be purchased in food stores as well as in wine shops.
Liquor stores will not go out of business unless they choose to. Consumers will still have to go there for spirits and brandies and that is good. Some scoff at the trade off of mixers and chips but what about the NY artisan cheeses that the consumer pays between $16 and $36 a pound for? There's a reasonable mark up in them! Liquor stores will be able to sell those products and more, under Governor Paterson's proposal, and thus build their adult customer base. Wine buyers who now shop (often for cases) in wine/liquor stores will still go there. We want the service, and camaraderie we get from wine store owners. There are enough consumers, in NYS, to support both types of wine sales outlets - food stores and wine shops.
I'd love to go to a wine shop and find other, selected related items (including those artisan cheeses) to buy. I'd also like to be able to buy a bottle of wine when I buy my food - and I LOVE Wegman's - as well as my local small supermarket who wants to carry local wines.
Please let your state legislators know, today, that you want them to support the sale of wine in NY food stores.
david creighton said on Mar. 10, 2010 at 11:16am
OK, so this piece is self serving - that's fine.
"wine shops were set up to be...." and why? because that would benefit consumers? because it fits in with our America ideal of a free market?
"owners have been happy to play by the rules..." well, of course. the state has protected their monopoly on the sale of alcohol. why rock that boat? but the rules are goofy by any standard. stores can sell wine, but not attractive bags to put them in; sell wine but not the cheese or bread to go with it.
"owners have built the wine industry(in NY)" - gosh, hard to know how to respond to something that . what were the wineries themselves doing all this time? one of the things was to try usually in vain to get those owners to carry their wines.
"retailers who have worked hard to get where they are" - why? they have a monopoly; they can work as hard as they want and still the customer has to come to them.
if wegmans started to sell furniture, would it put small family furniture stores out of business? lets ban that too then. the bottom line is that if you give a certain group of people an economic advantage in violation of basic American and economic principles, and then try to correct the mistake, that group may well get hurt. but they have profited overly well for 80 years. most other states allow supermarket sales. they think the sky will fall if they move to a NY type system. and these states all have a strong wine and liquor store sector as well.
Joseph said on Mar. 10, 2010 at 11:33am
You will not get more drinkers by having grocery stores sell wine. You will disperse the current drinkers to new locations. At our store we make it a point to push NY wine. We constantly are sourcing QUALITY NY wine. If you want more NY wine sold lift the restrictions on stores so they can sell more and then buy more NY wine. OR have the state and other states lift restrictions on wineries to make it easier to ship wine out of state. These are great solutions that don't force people out of business although I'm not sure Wegman's would sign on because they won't be able to pilage smaller competition. The liquor stores have a right to fight this. Either way with negotiations on anything they lose because they are forced to compete with giants after being so restricted. That is not free market and they were offered nothing that would help them, but only hinder them. These store owners have families, mortages and are using their stores to finance their retirement. You cannot change the game in the middle and expect them not to react this way. It's like a running race that they are 80 years behind in.
Jake said on Mar. 10, 2010 at 11:38am
There is no monopolies. stores like Wegmans will soon be the only place to shop at. People are free to shop at any liquor store they want and liquor stores pop up all the time. David Furniture stores were never restricted from expanding or selling more than just furniture. So your argument is foolish. It's not a government protected business its a restricted business.
WinoTripping said on Mar. 10, 2010 at 11:56am
You, the small "Mom and Pop" liquor stores, say that if wine is available in grocery stores you will be out of business. I admit, I am a big supporter of local business and usually side with the Mom and Pops, but this is a situation where you have to face the music. This is going to happen, either now or in the near future. Grocery stores are going to sell wine. It doesn't make sense for them not to, (what year is this, 1923? Hello?).
Time for you to stop wasting energy on policy making, and start solidifying your place in the community. Start a wine club or hold wine tasting events. Educate your customers about wine and they will understand that they need to come to you for quality and customer service. Believe me, there's nobody at Shop Rite that's gonna help a customer pick out the perfect wine for their chicken dinner. That's where you come in.
I live in California where you can buy wine at the grocery store, and there are still liquor stores and wine bars on every corner. I can't pretend to know the specifics of the New York law being proposed, but I'm sure it will benefit some more than others. But it's no time to sit back and whine (pun intended). In fact, the more wine the big grocery store sells, the better for you. It's overkill. Nothing will intimidate beginner wine buyers more than row after row of wines of all makes and kinds.
I've worked in independent bookstores for years, and we are always battling the next Goliath... chain stores, super stores, Amazon, &c... And it's true, many indie stores have gone out of business. But the ones that create community are the ones that last. Customers will go out of their way to shop at your store because they value having you in the neighborhood. Now, more than ever, customers understand the concept of "voting with their dollar".
If, on the other hand, you think your survival depends on the fact that you've had a monopoly on wine sales all this time, then you're probably done. You can go ahead and ignore your customers and continue to fight the legislation. Or, the better option, you can fight the battle that you have a chance to win by doing what you do best: sell wine.
Gregg Burke said on Mar. 10, 2010 at 2:35pm
I understand the fear of the large grocery chains getting liquor licences, but what small retailers have to realize is that these chains want to make money. They will come out of the box with really low prices across the board, but it will not stay that way forever. They see wine sales as a way of making huge profits. I have two large grocerey stores within a 5 minute drive from my small wine shop in NJ and they have no effect on what I do, they sell mass market brand names. I stock limited mass market brands in favor of smaller brands that are more profitable and better quality at competative prices. I also focus on service,and knowledge of product. I was able to grow my business double didgits in one of the worst economic down turns in history because I focus on providing better service then the big box stores. Small stores that want to continue to work as little as possible and charge what ever they want will go by the wayside, but that opens it up to people who are more aggressive and up for the fight. So my advice to small wine store owners is fight the bill all you want, but if it goes through get focused get organized and listen to your customers wants because people will pay a dollar more if they feel they are getting a better service. Good Luck in your fight.
Cheers
keith said on Mar. 10, 2010 at 3:16pm
This is simple. The monopoly was created by nys and nys only. they created monopolistic distributors. The distributors bid on products from the manufacturer and when awarded the product are given the entire state by nys. that is all bars restraunts and liquor stores. In otherwords, the whole ball of wax. So if you picked up Jack Daniels you are the only one that can sell it in nys and at their price and they are also great collectors of taxes for nys. The liquor stores have no options but to buy that product from that disrtributor and whats a liquor store without Jack Daniels. Liquor stores are in constant competition with other liquor stores. The only monopoly is between nys and the distributor. But of course they are dealing with a controlled substance not a free market item. Liquor stores are just living by the rules. They didn't make them. allowed one store and 2 items to sell. If wine is given to the big box stores the liquor stores which were never allowed to grow will be destroyed. If the big box stores don't get wine nothing will happen to them. Don'tt seem very fair does it.
Localobserver said on Mar. 10, 2010 at 5:03pm
First question, will liquor stores be able to sell beer, cheese, chips etc. once this law is passed? If not then we don't really have a "free market" only a market that benefits large chains stores.
Second, I believe at the end of the day this will not help NYS wineries. The problem is to get shelf space in a chain like Wegmans takes big bucks. The small winery won’t be able to afford it so the space will go to major distributors, expect to see foreign wines like Yellow Tail and some larger California wineries filling the shelves after the initial year or two feel good period.
lisa said on Mar. 10, 2010 at 6:01pm
I love nys wine but most stores have it in the back and the stores do not carry many nys products.
I would like to see nys wines in better position and less endless stacks of yellow tail and boxed wine. If this does go through maybe I will be able to go into store and see good selection and placement of nys wines and less rows of yellowtail and all the other junk wines that most stores promote. I have found a few good stores and love shopping there and will never go back to the stores that have a small section of local wines. If those stores close I could care less because the service and selection was pathetic and they should not be in business anyway.
John Q said on Mar. 10, 2010 at 6:19pm
The only concessions given to liquor stores would be chips and cheese. No beer. These do not help balance the loss they would feel. A reasonable trade off would be for the grocery stores to be able to carry box wine and wine over 3 liters or JUST NY Wine and let the liquor stores carry beer. Either way the liquor stores now are not set up to sell those products so it would take a capital investment by them to do it. Still seems very one sided to me.
Dry Creek Winery said on Mar. 10, 2010 at 6:43pm
"Played by the rules"? PLEASE. I seem to remember MILLIONS of dollars in fines being levied by then Attorney Genaral Spitzer to stores NOT playing by the rules.
Stores like Wegmans will carry the KJ, Gallo, and fosters portfolios like grocery stores around the country do. These are brands most stores make very little money on. Mom and Pop stores will still be able to carry most NY state wines with little competition. The real fear for the mom & pop store is they they might actualy have to work for a living, learn something about wine, sell and service a customer instead of sitting behind a counter and pointing to the Syrah section.
No sympathy for those who who will not evolve.
Keith said on Mar. 11, 2010 at 7:55am
Dry Creek Winery. The fines being levied were on Wegmans and Price Chopper. using register people under the age of 21. The state used to suspend licences when the rules were broken. Not anymore. They are living off of fines. Just check their site. Half a million a month. Most coming from beer in big box and c-stores. Not liquor and wine. They are family stores. Liquor stores do not cater to kids.so chips and cheese are a no go.
Ed Draves said on Mar. 11, 2010 at 10:01am
It does not surprise me to see a California Winery come out for this proposal. This would be a minor benefit to the California wine industry but devastate our own NY wine industry. As the local wine shops close (the shops that carry NY wines) the wineries will suffer. This proposal will cost a lot of jobs, leave a lot of storefronts empty and a lot of mortgages unpaid. Not a good proposal for a budget.
lisa said on Mar. 11, 2010 at 7:22pm
The fees and fines are a reference to a few years ago when it was common practice for liquor stores to demand free stuff in exchange for store placement with distributors. The distributors got wacked but it should have been those crooks that stack only barefoot and yellow tail.
If this passes I will be excited to see a real liquor and wine store. The type of store that does not devote all of its shelf space to jug wines. Maybe store owners and employees will have to learn about the products they sell and offer real customer service and a selection
I am also tired of hearing the. Underage drinking crap as well when we all know that underage kids go to a liquor store because they want vodka and cheap booze. They also know how most stores do not card.
John Q said on Mar. 11, 2010 at 8:32pm
Its shameful that people don't care about the stores who have worked hard, know their selection and support their local wineries. We work 70 hours a week sourcing our wine, growing our selection and helping our customers! So don't say we don't work. We are not scared of competition, we are scared of not being able to compete with huge money from big box stores who never had to deal with our restrictions. I'm sorry if you had bad experiences at some stores but that can be said for most stores. Lisa you can pick and choose wherever you want to shop, but be prepared down the road to only have supermarkets filled with exactly what you hate. So please stop with your hateful nonsense.
megan said on Mar. 11, 2010 at 9:29pm
For the "mom and pop" store who commented earlier. Do you really think that selling wine in "Big Chains" is going to help your business. Unforunetly stores like Wegmans uses "eye level shopping" How are you going to guarantee your wine will be put there. Wegmans is going to sell those spots to the highest bidder. Also Wegmans is always pulling products off there shelves and replacing them with there names slapped on it. Are you going to let that happen. Wine in grocery stores "cheapens" the product. I am a hairstylist and everytime "big chain" puts one of my products on there shelf we pull it off of ours. GREED is driving this proposal. Wine/liqour stores have weekly tastings etc and do what they can. These are hard working families not millionaires. SO many people will be affected by this change. Store owners, families, distributers, drivers, sales people etc. As my boss says "if Wegmans could bottle salvation they would put the churches out of busines" and say it was for the better of the community.
lisa said on Mar. 13, 2010 at 6:32pm
John q. In response to your statement I travel around a bit for business in state and out of state and Here are a few of my favorites that I will always shop at: exit 9, the premier group, century, and marketview because they have a great selection a good service with the pricing to match. Here are a few stores that I will not go to ever again because of both the selection, service, and price: irondequoit liquor, midnight liquors, colonial, and all star wine and spirits.
If this goes through maybe stores will have to provide selection and service to survive. I highly doubt that premier will go out of business bc of this and I know I will continue to shop there.
Daniel said on Mar. 14, 2010 at 11:38am
It would be so nice to live in a world where we could buy everything under one roof: groceries, retail goods, wine, beer and liquor. As a society, why do we do this to ourselves? What are we accomplishing by forcing ourselves to travel to different stores all over town to get the merchandise we want? Are we more civil because of it?
Old-fashioned, senseless laws need to go away. The NYS Liquor Board needs to be eliminated. It's time to live logically.
Robert s. Iandolo II said on Mar. 14, 2010 at 1:23pm
Mom and Pop Winery and Carol, you could not be more wrong on this subject! I have spent 30 yrs in this business in NY working for retailers, wholesalers and wineries /distilleries. No one entity can stake a claim at building the wine industry. Each piece of this 3 tier system has played a part in educating consumers on wine and spirits and how and when to consume them. Every supplier and wholesaler knows the value of retail and on premise in exposing brands. Forgive me, Mom and Pop, for being presumptuous but your issue with getting into liquor stores is almost exclusively based on consumer image of the wines produced by your geography. I have sold wines from Long Island and they have fantastic distribution in Suffolk Co. If you were to drive on Rt 25 / 25A from Orient Pt you would find distribution diminish to barely anything by the time you reached the 59th Street Bridge. Why, because the LI wineries benefit from local loyalty. As dogs bark and cats purr, so to, retailers sell what they make money on, its simple economics. As an example, when fruit flavored wines were launched retailers featured them. When their turnover slowed and they sat on the shelf, they became unprofitable and eventually they were discontinued. Upstate NY wines suffer a bigger PR problem, their past. They have not been able to retool from the jug wine days and produce worlds class wines as CA has. Sorry but it is a fact! I suspect you are located Upstate and think adding Wegmans will be a score for your winery's exposure, and that may be true for you. How many NYS wineries will Wegmans carry outside of NY? Not many. How many Stop and Shops, Waldbaums, King Kullen’s, ShopRite’s, etc do you think are going to allocate floor / shelf space to a product that consumers show little interest in relative to big brand items such as Beringer, Woodbridge, Yellow Tail , KJ, Sutter Home? Not many. Retail is retail, here is the golden rule, “if it sells I carry it”. Carol I now add rebuttal to you comments as well. The down side for wine and liquor shops in NY is that while they are being offered a trade off in that they can sell items that grocery stores now sell there is a distinct difference between the two retail entities. The most obvious is size and quite frankly you don’t need to go further than that. How is a small W&L store going to re-allocate shelf / floor space for these additional items that do not have the profit margin that wine has? The answer is they can’t. I have worked in a large grocery store; it would take the night crew 1 or 2 shifts to move wine to a single isle or half of an isle for wine. Take a physical look at a bag of potato chips and you will find it is as wide as 2 750ml bottles of wine. A Wine shop would probably get 8 or 9 bags on the shelf. A retailer would make at least $42 on 2 rows of a $10 wine but around $3 on 9 bags of chips. Do the math! Not only that the majority of underage alcohol sales are done in grocery stores selling beer. All of a sudden they will be better than that because of wine? Also, if you examine the difference between a Wegmans type grocery store and a Whole Foods you would see that the “Wegmans” type are featuring big name brands much more than boutique type brands. They also charge slotting fees which big suppliers can and do pay but smaller ones can’t. Are you thinking the macros are changing because of the addition of wine to the product portfolio? Come on! I would bet that 20 to 30% of NYs retailers will close shop if this law is enacted. What will be the impact on our economy if we have every clerk /delivery person laid off? I doubt that any grocery store will employ any more than one additional person to manage this new category. You need someone who knows the flavors, sizes; QD available etc, any stock boy can reload a shelf. Carol let me ask you, you would love to find artisan cheeses I a W&L store, great. Where do you buy those now? Are you going to change where you shop for a piece of cheese, probably not? Consumers won’t have to change where they shop if we add wine to a grocery stores inventory. They already shop there and now they won’t necessarily have to go to a wine store at all. What if they don’t drink liquor? To both of you consider this; how many wholesale reps will lose their jobs because there will be less accounts to cover? Wholesalers won’t need a sales person per store because the buying is done at a central location and it is illegal for wholesalers and supplier reps to do merchandising of any kind in a licensed outlet. You probably weren’t aware of that. How many additional lost jobs would that create? How can you compare the NE US to the south and west? Industry folk know only too well that these are completely different marketplaces. How many people lived in WA, OR or CA in 1933 per sq acre compared to NY, NJ or MA? These states developed at a different time and that can’t be compensated for without a major impact on a slew of economies. Carol, you may have different numbers than I do but I doubt winery hospitality in NYS is anywhere near 1 billion dollars. There aren’t as many wineries as in CA and I don’t know of one world class Bordeaux or Burundian style wine produced in the state. I read the Spectator and Enthusiast every single month do you? What brings them in? I would also like to point something out that certainly doesn’t exist in politics, Camaraderie. People in my business are tight. We know what laws benefit the consumer and which hurt them. Outside of cold cash a consumer is gold in this business! We work hard to bring the best we have to offer to them. Carol, I’m relieved that you will still be able to get your artisanal cheeses without an inconvenience but, and this is for Mom and Pop also, instead of supporting something because it sounds like it would be a benefit to you personally, step back and examine how many others will be affected by such a proposal. The bottom line is grocery stores will increase revenue and profit without expanding employment or salary for existing employees while simultaneously alcohol beverage merchants, wholesalers and suppliers will be losing revenue, increasing unemployment and reducing income for existing sales personnel in all 3 tiers. The good news is that Governor Paterson will have more Yankee and Met tickets than he knows what to do with. Thank you.
lisa said on Mar. 15, 2010 at 5:21pm
Robert, have you actually read the proposal? If you have then you would know how wrong your statements are completely false and just plain wrong. First off, slotting fees are illegal in the wine industry. You also should check into your sales rep statement because each grocery account will have to order seperately and it will be illegal for centralized purchasing unless you are a liquor store. If you are a liquor store you then can create a group of no more than 5 so that liquor stores can remain competitive. As far as your statment of the quality of new york state wines and your blessed bible of wine spectator you are part of the problem. Because you refuse to see how far new york state has come and refer to bordeoux to make a comparison. Do you even know what that blend is called in america? Also, the wine and wine tourism industry in new york brings in well over a billion dollars each year. Look it up before you say something. I am tired of people who do not have a clue about what they are speaking about and putting out false information.
I also disagree with your burgandy statement. The chardonnay produced here is world class and the pinot is vintage specific just like burgandy. 2001, 2005, 2007 were the best vintages of the decade for pinot and chardonnay is very consistant and produced in several styles ranging from chablis style to sonoma's style.
Also if there are more places purchasing wine. Let's say only 500 more outlets total instead of 19000. You need more salesmen to sell the wine and no central purchasing can happen. You need more trucks to deliver wine. You need more truck drivers to deliver. You need more people in the offices of the distributors to handle paperwork. You need more wine, bottles,corks,labels, production tanks and winery staff. Seems to me like every tier will grow. Retail more outlets, ditributors need a larger sales force and additional drivers/trucks. Wineries need more winemaking materials and wine and people. It seems like a good thing to me. I do believe a few stores will close and they will be the stores who only focus on big box brands anyway. Check your facts before you make crazy statement. I am still learning more about this and am so suprised to see how many lies are told online.
Jane said on Mar. 16, 2010 at 10:37am
Just so you know Lisa, those big brands you hate so much, they pay for the wine that you think is so "fine and complex". You clearly have no understanding of whats going on. The big picture is Lisa, that you have a choice no to shop at any wine store you see fit. In the long run this won't be the case with this law. Also This proposal is what is wrong with this country all together today. Whether you agree or not you don't change rules on people who have made it their lifes work for their business for the overall greed of larger businesses.
lisa said on Mar. 16, 2010 at 7:39pm
Once again another person comes with a personal attack. If you disagree with this proposal then you are probably are a socialist and do not believe in the free market system that promotes competition and also profits. Since prohibition the liquor stores have not moved one step forward and refuse to. They do not have to be innovative and deliver service because they have no competition. I hope this passes and then the stores that survive will be forced to be creative and competitive. I will be glad to see liquor stores losing the boxed wines and jug wines to grocery stores so they are forced to learn about wine and carry better products.
The big box brands do not pay for the wines I drink and I will bet that the margins and price levels are much better than yellow tail.
The problem that I see happening if this passes is that the liquor stores refuse to change their business model and wegmans ends up carrying more local products proving how little the liquor stores have done for our local products. By the way I also double checked the economic impact of nys wines and it is just below 4 billion a year. How can anyone bash a local industry that happens to be one of the only growing industries in ny unlike the liquor stores who keep shrinking each year. Open the market and allow competition. The liquor stores have been doing this since prohibition ended and they are still worried that a grocery store will do a better job promoting wine than they will. I think that to many stores have not worked hard enough and will see how poorly they have operated the business very quickly. Those who deserve to survive will and those who do not will fail. That's the free market. An option to succeed or to fail.
Mark said on Mar. 21, 2010 at 12:53pm
Lisa,
I believe in a free market. This is a free market for one side only! The liquor stores get nothing of value in return to sell. Let me ask you another question Lisa. You have two items to sell in one location. How much extra capital could you possibly generate even if the best service and selection are as good as you, Lisa, want them to be. I also personally know of one store in Rochester who has a great selection of small vineyard GREAT wine. Guess what that store is not doing well, you know why Lisa because there is only a select market for those wines. So you have to carry everything to cater to all customer bases when you are only allowed two products to sell. There are so many Lisas with your sophisticated palates and you im so sure deep pocket book. So the six bottles of cakebread sold in a year is paid for by the 100 cases of Carlo Rossi. Do you suggest that liquor stores be allowed to sell beer that was overtly left out of the budget or do you favor just a free market for oneside.
Eric said on Mar. 23, 2010 at 9:37am
Thank to everyone for posting their very thoughtful comments on this issue. However, a reminder: personal attacks will not be tolerated on this website. You can disagree with someone else's opinions, but let's not resort to name-calling or verbal squabbles, please.
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