WEBVTT - Stew Leonard’s Wines & Spirits President Blake Leonard Talks Beverage Industry, Company Succession

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio news.

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<v Speaker 2>About a year ago, we were kind of coming off

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<v Speaker 2>Trump's President Trump's Liberation Day, higher or uncertain tariff environment.

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<v Speaker 2>It was. We were kind of up in the air

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<v Speaker 2>about a lot of things. And at the time we

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<v Speaker 2>were forecasting put out a story at Bloomberg just ahead

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<v Speaker 2>of Memorial Day that the price of a cook atte

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<v Speaker 2>was going up.

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<v Speaker 3>B prices were an issue.

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<v Speaker 2>Then too, yes, right, and that was well. The story

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<v Speaker 2>got into a lot of the issues were domestic ones

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<v Speaker 2>that were impacting the prices of things. And then I

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<v Speaker 2>think about this year, Tim, what's going on?

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<v Speaker 3>Okay, us warning ron higher energy prices, higher gas prices,

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<v Speaker 3>inflation prints just this week reminding us that inflation is

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<v Speaker 3>outpacing wage growth. Not so good.

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<v Speaker 2>That's so great. So what does it mean for our

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<v Speaker 2>summer picnics as we get ready, please please to kick

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<v Speaker 2>off summer. It's just around the corner.

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<v Speaker 3>It was a felt like forty five this morning. That

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<v Speaker 3>was to feel like temperature fifty one degrees in New York.

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<v Speaker 2>I still head layers. I hear it's going to be

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<v Speaker 2>like eighty degrees on Sunday. Yep for more, let's head

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<v Speaker 2>to Stu Leonards Fine Wines and spirit Store. It is

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<v Speaker 2>in Norwalk, Connecticut. That's where we find Blake Leonard. She's

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<v Speaker 2>the president of Stu Leonard's Wines and Spirits. She's also

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<v Speaker 2>part of the next generation that will take over running

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<v Speaker 2>the store founded by her grandfather. She will take the

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<v Speaker 2>reins as president along with a cousin from her dad,

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<v Speaker 2>Stu Leonard Junior, keeping it in the family. I love

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<v Speaker 2>that you are a certified so from the Culinary Institute

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<v Speaker 2>of NAPA. You've worked for many other families too in

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<v Speaker 2>the wine business, including the well known Gallows. Blake Welcome, Welcome,

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<v Speaker 2>how are you? Hey?

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<v Speaker 1>Thank you so much for having me today. And you know,

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<v Speaker 1>since it's Friday, I wanted to start off just cheersing

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<v Speaker 1>you with.

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<v Speaker 2>Right here. Oh my god.

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<v Speaker 3>I feel like she's seen Leonard do this a few

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<v Speaker 3>times on our show. Yeah, learned from the best.

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<v Speaker 2>I love you, I love you, but I do resent

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<v Speaker 2>that there wasn't one cent to us. That's all I'm

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<v Speaker 2>good to say.

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<v Speaker 1>I know.

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<v Speaker 3>I'm just going to say I think the interstate liquor

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<v Speaker 3>laws that's a big issue, truly.

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<v Speaker 1>That is true. Yeah, well, maybe you know right here

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<v Speaker 1>in sprits season now, so I'm excited.

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<v Speaker 2>Hey, talk to us though about the environment before we

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<v Speaker 2>get into the summer season, what people are interested in

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<v Speaker 2>terms of wines and spirits, But talk to us about

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<v Speaker 2>the consumer, what you guys are seeing.

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<v Speaker 1>Yeah. Well, you know, I was the other day just

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<v Speaker 1>visiting one of our wine suppliers and he was saying

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<v Speaker 1>that it costs him over two thousand dollars more just

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<v Speaker 1>to get a container of wine here into the US

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<v Speaker 1>right now. And that's you know, just one part of

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<v Speaker 1>the whole transportation piece, you know, for getting wine into

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<v Speaker 1>our wine stores.

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<v Speaker 2>Wow.

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<v Speaker 3>So you couple that with actually selling the wine in

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<v Speaker 3>a time when we're hearing more and more about young

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<v Speaker 3>people not drinking as much. This idea of like, you know,

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<v Speaker 3>dry January actually lasting the entire year. What does that

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<v Speaker 3>mean for the overall business?

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<v Speaker 1>Well, you know, you also see customers here on the

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<v Speaker 1>store and I was just talking to a lady the

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<v Speaker 1>other day who was just talking about how much more

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<v Speaker 1>it cost her to fill up her huge you know

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<v Speaker 1>van that she drives with all her kids. So you know,

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<v Speaker 1>we you know, everyone here on the store floor is

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<v Speaker 1>definitely feeling it. I think one good thing and I

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<v Speaker 1>was hearing all the stock prices before. But about being

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<v Speaker 1>a family business is that we can you know, work

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<v Speaker 1>with our suppliers and hold those costs. In a lot

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<v Speaker 1>of instances will split, you know, that transportation cost with

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<v Speaker 1>our suppliers, so we can keep prices here on our

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<v Speaker 1>store floor family friendly.

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<v Speaker 2>And you guys have not yet seen price increases. My

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<v Speaker 2>understanding is due to fuel.

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<v Speaker 1>Correct yes, we have not, you know here in the

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<v Speaker 1>wine business, as you started off with the tariffs that

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<v Speaker 1>was big last year and for this year, really no

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<v Speaker 1>one wants to raise the price of wine right now.

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<v Speaker 1>And I always look, this is a great new rose

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<v Speaker 1>that just came in. It's a new, fresh vintage. But

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<v Speaker 1>you know, we're retailing this under fifteen dollars. And if

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<v Speaker 1>I were to go and sell it over fifteen dollars,

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<v Speaker 1>what happens to sales is they go down. So you

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<v Speaker 1>really have to be price sensitive with those barriers there.

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<v Speaker 1>And we look at it as hopefully a temporary thing,

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<v Speaker 1>and you know, trying to look at the longer picture.

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<v Speaker 3>Is the idea on it with a product like that,

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<v Speaker 3>and if you know, if I'm thinking about margins correctly,

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<v Speaker 3>that you take a little bit of a hit there,

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<v Speaker 3>but you get people in the store to buy that,

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<v Speaker 3>and then they buy other things that don't have as

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<v Speaker 3>big as that have bigger margins.

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<v Speaker 2>Yes.

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<v Speaker 1>Well, And one of the things that I love doing

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<v Speaker 1>is I'm like a little you know, wine detective out there,

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<v Speaker 1>but I love going Every year we go to a

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<v Speaker 1>wine show, either in Paris or in Italy, and we

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<v Speaker 1>get to meet firsthand with a lot of these multi

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<v Speaker 1>generational families who are making unbelievable wine and we get

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<v Speaker 1>to bring them back and sell them in our stores.

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<v Speaker 1>And really they are wines that over deliver for the price,

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<v Speaker 1>and we often say they taste like their twice the price.

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<v Speaker 1>So really trying to bring not only the price points

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<v Speaker 1>but also the story back for our customers because we

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<v Speaker 1>think that now more than ever, that's what customers want

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<v Speaker 1>to hear about.

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<v Speaker 2>I'm always amazed, like when you're over in Europe or

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<v Speaker 2>Paris and you just order i don't know, just a

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<v Speaker 2>little wine, nothing big, and it's just great. Like I

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<v Speaker 2>feel like, over the years and you know, this this

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<v Speaker 2>industry blake, it just feels like, you know, we keep

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<v Speaker 2>getting told you don't have to spend a lot of

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<v Speaker 2>money to get a great bottle of wine.

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<v Speaker 1>Yep, no you don't. And you know right here this

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<v Speaker 1>is this is a course of kin rose that I

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<v Speaker 1>have and this is also one of our best sellers.

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<v Speaker 1>It's a provence rose under fifteen dollars. A female winemaker.

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<v Speaker 1>She won the top one hundred winemaker, you know, one

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<v Speaker 1>of the top one hundred wine makers in the world.

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<v Speaker 1>She was awarded a couple of years ago. So there's

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<v Speaker 1>great value out there. You do have to, you know,

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<v Speaker 1>spend time looking for it. But that's what we really

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<v Speaker 1>strive to do for our customers here on the store floor,

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<v Speaker 1>as well as educate them.

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<v Speaker 3>So let's talk a little bit about the next generation

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<v Speaker 3>of Stu Leonards and sort of the timeline for you

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<v Speaker 3>and your cousin taking over. And also I'm curious about

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<v Speaker 3>with a background in wine and spirits, what you can

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<v Speaker 3>then do in your approach to the grocery business, an

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<v Speaker 3>historically low margin business, a very challenging business that you

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<v Speaker 3>know you have to work with the ups and downs

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<v Speaker 3>of the economy in the macroeconomic environment. What is your

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<v Speaker 3>plan for Stu Leonards when you take it over.

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<v Speaker 1>You know, yesterday all of my cousins and my Dad.

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<v Speaker 1>You know, it was work, but we got to spend

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<v Speaker 1>the day all together in the city listening to other

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<v Speaker 1>family businesses talk and it was a really awesome day.

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<v Speaker 1>But one of the biggest takeaways I had listening to

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<v Speaker 1>Jim Purdue speak and we got to meet him afterwards,

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<v Speaker 1>and hearing Enterprise as well and panneda express. They all

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<v Speaker 1>stick to their core values, so no matter what happens,

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<v Speaker 1>is sticking to their core values. And when I look

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<v Speaker 1>back at our business today, you know, I grew up

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<v Speaker 1>drinking milk from Stews, and my kids today they're also

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<v Speaker 1>drinking milk from Stews, but it's organic. And so you know,

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<v Speaker 1>if we had twenty years ago tried selling organic milk,

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<v Speaker 1>it would have been way too expensive to really for

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<v Speaker 1>our customers at that time. But we've evolved and so

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<v Speaker 1>it's kind of just this slow evolution over time, and

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<v Speaker 1>that's you know, one of the things that always sticks

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<v Speaker 1>out to me is that my kids are drinking organical milk.

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<v Speaker 2>Now. I just want to mention. We have a headline

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<v Speaker 2>crossing from Reuters SpaceX picks the NASDAC as it's listing

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<v Speaker 2>venue for its massive upcoming IPO on that did you guys.

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<v Speaker 2>Do you guys ever think about going public.

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<v Speaker 1>We've definitely had offers and we have you know, offers

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<v Speaker 1>either go into partnerships or to be purchased, and it's

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<v Speaker 1>always something we think about because in my generation it

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<v Speaker 1>went from four in my dad's generation now to over

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<v Speaker 1>thirteen of us and now in the fourth generation there's

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<v Speaker 1>over twenty two great grandkids. So it's definitely something we

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<v Speaker 1>always think about. But really what we want, and you know,

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<v Speaker 1>my cousins and I all just met recently to talk

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<v Speaker 1>about this, is we really want to keep this a

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<v Speaker 1>family business and want to continue you know, the decisions

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<v Speaker 1>we get to make every day are really you know,

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<v Speaker 1>ones that we don't have to rely on anyone else

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<v Speaker 1>for that. So listen.

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<v Speaker 2>So fun to catch up with you, stay in touch.

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<v Speaker 2>Thank you very much, especially as we kick off the

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<v Speaker 2>summer season. Blake Leonard, she's the president of Stu Leonard's

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<v Speaker 2>Wan and Spirits, joining us at there in Connecticut