Listen to this article now |
As its free-spending corporate clientele continue to avoid Midtown Manhattan, Sherry-Lehmann, the upscale wine shop that has long established a reputation as New York City’s preeminent booze merchant, is in danger of closing its doors, The Post has learned.
The 88-year-old landmark, which once counted Greta Garbo among its devoted patrons and is credited with introducing Dom Perignon to the US in 1946, has failed in a daring, risky attempt to expand its business nationwide, according to sources who spoke to The Post. This is despite the fact that the Big Apple is still struggling to recover from the pandemic.
According to the Department of Taxation and Finance’s list of the top 250 delinquent business taxpayers, Sherry-Lehmann is currently ranked ninth with a staggering $3.1 million in unpaid sales taxes, a spokesman for the organization told The Post.
They are near the top of this list, Gazzale declared. “We are working with them to find a mutually beneficial solution so that they can solve the issue as soon as possible. If no agreement can be reached, we can take over the company.
Sources claim that suppliers to the storied store aren’t taking any chances either and are requesting unusually strict payment terms from Sherry-current Lehmann’s owners, Kris Green, a former hedge fund executive who acquired an undisclosed stake in the company in 2013, and Shyda Gilmer, a longtime employee who is now its CEO.
According to a source with knowledge of the situation, suppliers are currently pressuring Sherry-Lehmann to wire them the money because their checks were bounced.
Requests for comment from Green and Gilmer were repeatedly ignored.
This week, a visit to the once-bustling store at 505 Park Avenue revealed a small number of patrons browsing the disorganized shelves. With the exception of a row of rather ordinary bottles priced at $54.95, the White Burgundy section, which was once home to expensive bottles from Montrachet, Corton-Charlemagne, and Mersault, was mostly empty.
A few steps away, three expensive 2012 Chateau Ausone St. Emilion Bordeaux bottles that cost a whopping $7,995 each were dirty and covered in fingerprints. A $695 bottle of Chateau Filhot Sauternes was leaning against the side of its case right next to them.
Sherry-Lehman, established in 1934 by Sam Aaron and his brother Jack, a reputed bootlegger during Prohibition, gained a reputation as a point of entry for high-end French wineries into the US market. A trained psychologist with a talent for marketing, Sam Aaron once boasted of his unsuccessful attempt to corner the market on Chateau Petrus, one of the finest wines from Bordeaux.
The venerable retailer, however, has recently been plagued by expensive, misguided decisions. The decision to leave its Manhattan flagship from 679 Madison Avenue, where it had owned its real estate for 60 years, may have been the biggest. The move occurred at the same time that Michael Aaron, the last steward of the Aaron family’s business, left his position.
Sherry-Lehmann pays nearly $2 million in yearly rent for its current, three-story, 9,500 square foot, glass and steel Park Avenue location at the corner of East 59th Street, a source familiar with the company told The Post.
As it prepared to open a store there, the company quietly closed a warehouse it had opened in 2017 close to the Los Angeles International Airport. This was reportedly the first step toward a now-scrapped goal of creating a national brand.
The source claimed, “They chose to sell the building they own to raise money and open Sherry-Lehmann West in Los Angeles, but it was a huge bust.” They must now rent now.
Sherry-Lehmann also closed its 65,000 square foot warehouse in Jamaica, Queens earlier this year. This facility housed inventory for affluent customers who frequently purchase multiple cases of pricey Burgundy, Champagne, and rare whiskies and cognacs.
Members of the Wine Liquor & Distillery Worker’s Union of the UFCW received union pay as warehouse employees there. A union representative claims Sherry-Lehmann informed them that it intended to establish a new warehouse in Pearl River, Rockland County.
According to wine trade magazine MarketWatch, Sherry-Lehmann generated $42 million in revenue as recently as 2018. According to a 2016 Time Out article, the Park Avenue store at its busiest stage operated a shuttle service three times per day between its warehouse and the Park Avenue location.
During the pandemic, former Sherry-Lehmann CEO Chris Adams told MarketWatch, “If you want to buy three bottles of something, you can go online and search to find those bottles.” “However, if you want to purchase three cases, that calls for a different discussion. We are defined by the wine that we own and store in the warehouse. For Sherry-Lehmann, it has always been an actual distinction.
However, sources claimed that Sherry-Lehmann’s nationwide goals and ambitious customer service strategy have since been abandoned as overhead costs became intolerable, largely as a result of the pandemic.
According to Michael Correra, owner of a liquor store in Brooklyn and executive director of the Metro Package Store Association, a trade organization for the industry, “a lot of the Manhattan liquor stores are hurting because the workforce hasn’t returned to Manhattan.” They conduct a lot of significant corporate business, but that business simply does not exist.
Shyda Gilmer, a co-owner of Sherry-Lehmann, acknowledged last year that the business had to change.
Gilmer stated to Leaders in April 2021 that “we have aggressively invested in our infrastructure, logistics, and technology platforms to address the surge in online purchasing and contactless delivery to the customer’s doorstep” as a result of the pandemic’s significant reduction in foot traffic in Midtown Manhattan.
The investments weren’t sufficient. Sherry-Lehmann, which had previously been open on the weekend, had a notice on its front door earlier this week stating that it was now closed on Saturdays.
The sign read, “Please excuse our appearance while we improve.”
What do you think of the situation with wine shop Sherry-Lehmann’s possible closing? Please let us know in the comments.
