Court rules KY law can't bar liquor, wine from grocery sales

[Robin Garr]

Wine and liquor coming to Kentucky groceries? W00t! I've always thought this law was prima facie unconstitutional, but the beer wholesalers historically paid very well to make it happen.

http://www.bizjournals.com/louisville/n ... tucky.html

Interesting opinion - just two quick points.

First, Judge Heyburn is staying enforcement of the ruling pending resolution of other issues. If an appeal is filed to the Sixth Circuit Court of Appeals, the ruling could be stayed further pending that outcome, which could take at least a year. If that happens, and then either party seeks certiorari to have the US Supreme Court hear the issue, it could be at least another year even if the Supreme Court denies cert and declines to hear the case. In short, if this excites you, be cognizant that if the decision holds, it could potentially be years before you'll see wine and liquor in grocery stores.

Second, while I personally tend to agree with the decision on constitutional grounds, I wonder what would be the economic impact on local liquor stores.

Interesting opinion - just two quick points.

First, Judge Heyburn is staying enforcement of the ruling pending resolution of other issues. If an appeal is filed to the Sixth Circuit Court of Appeals, the ruling could be stayed further pending that outcome, which could take at least a year. If that happens, and then either party seeks certiorari to have the US Supreme Court hear the issue, it could be at least another year even if the Supreme Court denies cert and declines to hear the case. In short, if this excites you, be cognizant that if the decision holds, it could potentially be years before you'll see wine and liquor in grocery stores.

Second, while I personally tend to agree with the decision on constitutional grounds, I wonder what would be the economic impact on local liquor stores.

The grocery stores originally just asked for wine to be legal and tried to go through the proper channels to get the law changed. They failed for years to get even a vote on the law and they finally sued the state. Now the liquor stores that fought so hard against wine in grocery stores are now looking at wine AND spirits being allowed. I'm thinking they wish they had a mulligan on that one.

Interesting opinion - just two quick points.

Second, while I personally tend to agree with the decision on constitutional grounds, I wonder what would be the economic impact on local liquor stores.

Dilution of SOME business. You won't have to stop at a liquor store to get that quart of Pappy after getting your groceries. But, generally, it is not going to have a large effect. I look for more advertising on prices. Better deals at the traditional drinking holidays like Derby, St. James Art Show, All Hallow'ed Eve and such but we are not going to see the large box liquor stores close. No one is going to be offering up wine to beat 3 buck chuck.

The idea of competition is limited because there are not enough distributors. Let Wal-Mart put in a liquor and wine isle and allow them to purchase directly from distilleries and wineries, THEN you will see prices shift dramatically. Until that part of the business equation changes, not much change on the consumer end.

Ky will never get rid of the 3 Tiered system.

[Robin Garr]

Ky will never get rid of the 3 Tiered system.

Not in the legislature, that's for sure. However, possibly in the courts. The Supreme Court decision in Granholm vs Heald has the wholesalers' unconstitutional monopoly on the ropes, and the lobby's best effort to hang on to Kentucky's strict no-shipping law got thrown out by the courts already. This leaves Kentucky's current status very unclear. ABC says the rules fell back to the old felony law, and that keeps many vendors from shipping here, but that law is actually a scam: It's a felony on the third strike only, and no one has ever heard a first strike called. In practice, you can get wine shipped here, you just have to find vendors willing to do it. (And I don't intend to publish a list. )

2 threads on this here, this one seems to have more substantial response on it.

The wine retailer I worked at in Chicago felt very little impact from grocery stores selling wine, though it wasn't like there was an industry or city wide sea change that happened during my tenure there. You might imagine that Kroger opening their wine shops (which I believe now also sell spirits) would have already had that impact on retailers such as the two I work at (Old Town and The Wine Market) in the last year or two. So far, I see none, and I look at our numbers every day (or at least every shift I work).

There are a variety of reasons for this, but the simplest one is that the chains are not heavily invested enough in bringing on the personnel who really understand wine to stock their shelves with interesting products. Our sales of Yellow Tail et al. have probably dropped a touch, but our pricing on that sort of product remains competitive, while our selection of quality, estate-bottled wines is way better, as is our pricing on those wines. Further, I've tasted the majority of the product we stock, and can actually talk to you about it, if you indeed want a lecture with your wine purchase. Heck, you can't even get that at Trader Joe's, who do have good deals on interesting wines in their little wine ghetto (the majority of which are purchased out of a regional corporate office). True, Valu Market does a great job with beer, maybe they would step up their game with wine...I don't know. But as things stand, I'm not at all worried.

...No one is going to be offering up wine to beat 3 buck chuck. .

[/quote]

I can't let this go. No personal offense intended here, but I have to point out that I have tons of wine that beat that swill in my shop. It's not 3 bucks, but 1)you get what you pay for and 2)if you can't tell the difference, I won't convince you anyways. I understand not everyone can spend $12/btl for your Tuesday night wine, but what we're talking about here is "beating 3 buck chuck", which frankly, isn't that hard to do.

[Robin Garr]

I can't let this go. No personal offense intended here, but I have to point out that I have tons of wine that beat that swill in my shop. It's not 3 bucks, but 1)you get what you pay for and 2)if you can't tell the difference, I won't convince you anyways. I understand not everyone can spend $12/btl for your Tuesday night wine, but what we're talking about here is "beating 3 buck chuck", which frankly, isn't that hard to do.

Well said. This is the rough equivalent of the forum beer wars. If all someone wants is an alcohol delivery device at the least available price, then one is drinking the least common denominator. If that floats your boat, then the good lord bless you. But it's not for me.

....There are a variety of reasons for this, but the simplest one is that the chains are not heavily invested enough in bringing on the personnel who really understand wine to stock their shelves with interesting products....

This is why I can never picture myself not buying my wine at Old Town or the Wine Market (or, in fairness, Westport or Gemelli). You go, Ken B.

Or the WIne Rack, for that matter. John is killing it over on Frankfort Ave right now.

[Robin Garr]

Or the WIne Rack, for that matter. John is killing it over on Frankfort Ave right now.

And I can walk my wine home from John's. Definitely a keeper in the hood!

The alcohol laws are ridiculous in general. I won't even comment on the Sunday sales laws. We needed to use a distributor to buy kegs from Cumberland Brews right next door. Their building was less than five feet away (literally), yet the kegs would need to get put on a truck, driven to a warehouse, and then re-trucked back to us. And of course at a significantly higher price than Cumberland sold it to them at. Prohibition era laws.

(Distribution did work in my favor as a brewer in Arizona, shipping kegs up to Flagstaff or Lake Havasu for a relatively small markup. It also let us get into chain stores relatively easily - many tricks involved there, but distributors helped. Self distribution was legal there, and was the way to go for a TRUE local brewer. But if you were distributing statewide, like me, it didn't make sense.)

The alcohol laws are ridiculous in general. I won't even comment on the Sunday sales laws. )

What is up with that law. Did it have something to do with attendance at Church?