Monday, May 4, 2009

Liquor store owners anticipate campaign

The grocery-store sales debate marches onward.

A recap: Under Colorado law, grocery stores are not allowed to sell beverages exceeding 3.2 percent alcohol by volume. In practice, this means grocery stores sell the standard Coors, Bud, etc., all at 3.2 percent ABV, while liquor stores sell all the good beer.

Current law essentially gives liquor stores (along with bars and tasting rooms) a monopoly on selling full-strength beer. This has worked enormously to the advantage of liquor-store owners, who are understandably reluctant to lose their monopoly.

Brewers are siding aggressively with the liquor-store owners, fearing that they would lose access to customers if they had to compete in chain supermarkets.

Everybody expects a bill to resurface to allow grocery stores to sell full-strength beer. A bill died this legislative session that would have done that. A voter initiative is another real possibility that is thought to have strong chances.

Local brewers would probably feel a hit if the law was loosened, but liquor-store owners are the ones with a gun to their heads.

A group of liquor-store owners gathered recently at Ska Brewing in Durango to plan for the fight, reports Ted Holteen of The Durango Herald.

Soggy Coaster's speculative take: A law allowing grocery stores to sell full-strength beer looks likely to eventually pass. Some of the smaller, weaker liquor stores will close, leaving those with the largest selections alive. Durango breweries will have a tougher time distributing in Denver, but they will survive and continue to prosper.

Agree? Disagree? Thoughts? Rants? Leave a comment.


  1. As a big fan of craft breweries, I think the way things are now is good for the industry. I like how things are now, it's easy to find craft beer, I fear that if grocery stores are allowed to sell full strength beer they'll bring in national brands and maybe one or two of the bigger craft beers and leave the little guys behind. Many liquor stores will close and it will be harder to find craft beer.

    I can see how grocery/convenience stores find the current arrangement unfair. One thing I learned from the Herald article is that Colorado law makes it illegal to own more than one liquor license, it seems like if the law were changed to allow grocery stores to sell full strength beer this law might be updated to allow for more than one liquor license, which might cause national liquor store chains (Beverages and More for instance) to come in, which wouldn't be a good thing for anyone.

  2. From what I can tell, the durango beers that are on sale in denver do pretty well. Every time I buy one the comment is either "I love that stuff" or "wow everyone is buying that stuff" or "man I need to try that stuff." That said, I bet Ska would continue to sell successfully in grocery stores.

    Also, I live in a neighborhood with two grocery stores and two liquor stores. There are definitely more liquor stores than grocery stores in Denver. As I've said before, some of the liquor stores are abusing the monopoly and sell a terrible selection at horrendous prices just because they can. If one of these liquor stores (in Denver they are typically adjacent to a grocery store) goes out of business for every grocery store that starts selling a selection of booze, the liquor store good guys can stay in business and the consumer wins.

    I imagine Ska and Steamworks could get some shelf space in the "local" Denver grocers (I think of King Soopers and to a lesser extent Safeway and Whole Foods in Denver, vs. Target and Wal Mart) and gain a whole new crowd of customers.

    I could easily be wrong about all of this, but in my little section of the world, it wouldn't be a bad thing at all.

  3. I lived in both California & Phoenix previous to Durango. Both states allow full beer/wine/liquor sales in the grocery store. California has a balance of liquor stores that still thrive, and that is where the selection is. Phoenix has very few. In both cases, the larger microbrew brands (the guys that can produce VOLUME) are available at safeway or whatever (full sail, fat tire, redhook, deschutes). The smaller breweries will be found at only a percentage of stores (usually the larger & newer ones that have a massive booze isle).

    It really comes down to what the distributor will promote based on sales and volume. If safeway asks for 10,000 cases of brand x, y, z, is the distributor going to work that hard to get 100 cases from a smaller brewery on the shelf, or just go after the easy margin on the bulk order? A corporate grocery chain doesn't give a rats ass about selection. If it doesn't move, don't expect to see it again.

    The fact is that every dollar spent on beer outside of a local liquor store is a dollar that just left the community for a corporate coffer in Denver, Tempe, or wherever Koreger's Foods is HQ'd. Will Star Liquor be around? Probably. Will they have the margin to stock a wide vareity of new and seasonal stuff? maybe, maybe not. Will BevMo, or Liquor Depot be gone. No way. But we'll never see one down here. Imagine driving to Boulder or Denver to find beer selection...

    Having the stores open on Sunday was key. Now that it is law, keep it like it is. Changing it would kill 100's of small but profitable businesses across the state.

  4. Good points, all. I imagine that allowing full-strength beer in grocery stores would probably kill a lot of liquor stores. The issue is whether a majority of Colorado voters care. I'm not sure they do.

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