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No Wine in NY Grocery Stores!

March 24, 2009

The State of New York has had a tumultuous relationship with wine and liquor sellers over the years. 

A few years back, liquor stores (the only place you can buy wine and hard liquor in NY) were clamoring for the state to rescind the Depression-era “Blue Laws” and allow them to open their doors on Sundays.  They got their wish – sort of.  These days,  liquor stores are allowed to open on Sunday, provided that they close on another day of the week.  Essentially, they are legally banned from operating their business seven days a week.  What a crock.  One charming little remnant of Prohibition still remains – no alcohol sales before noon on Sundays.  From NYS Liquor Authority laws:

Sec. 105.14 – Provisions governing licensees to sell at retail for consumption off the premises:

(i) On Sunday before twelve o’clock post meridian and after nine o’clock post meridian.
(ii) On any day between midnight and eight o’clock antemeridian.
(iii) On the twenty-fifth day of December, known as Christmas Day.

Apparently, God does not wish New Yorkers to imbibe at times when they should be praying.  But I digress.

In addition, liquor/wine retailers in NYS are only allowed to have ONE license – meaning they are only allowed to own/operate ONE liquor business.  This state knows sure how to restrict commerce, doesn’t it???

In 2006, NYS AG Eliot Spitzer (aka “Client No. 9”) discovered that some liquor wholesalers had offered discounts and free merchandise to preferred bars, restaurants, retailers, and nightclubs. From 2002 to 2005, these establishments received more than $50 million in illegal swag including cash, vacations, cases of wine and spirits, iPods, golf clubs, and AMEX gift cards, according to Spitzer’s office.  So, the gov put a stop to that too.  Rightly so.

TODAY, the big to-do is about allowing grocery stores to sell wine.  Recently, large grocery chains in Upstate NY (such as Hannaford, Price Chopper, and Wegman’s) have begun media campaigns telling New Yorkers that “It’s Time for Wine” – meaning, it’s time to call your congressman and/or Governor Paterson and tell them you want to buy wine in your grocery store.  Obviously, liquor store retailers are absolutely up in arms over the prospect of losing sales to places like Wal-Mart SuperCenters and potentially going out of business altogether (that really does suck).

The NY Times did a great piece today about this dilemma , and offered some interesting perspectives.  As a food lover and amateur wine connoisseur, I like the idea of being able to purchase my food and wine pairings at the same location.  Food and wine are meant to be enjoyed together, and (on the surface) it makes sense for them to be sold together.

That being said, it sickens me that the Wal-Marts of the world have become nearly the only places where consumers can purchase ANYTHING anymore.  Our (dear) leaders keep referring to “Main Street,” which is an outdated, long-forgotten relic of a concept these days.  Mom-and-Pop businesses are closing left and right, unable to compete with the massive buying power and pricing clout that major chains wield over manufacturers and distributors.   And this market domination was happening long before our nation’s financial tsunami came aground last year.  Allowing grocery stores to sell wine would no doubt shut down even more small businesses in New York, putting more entrepreneurs out of work, and driving even more of our population to more business-friendly realms.  After all, the grocery stores would be allowed to sell wine at every one of their stores (Price Chopper alone has 71 stores in NY), while liquor stores would still only be allowed a single license.  How could they possibly compete?

Some folks are offering a compromise of sorts: grocery stores would only be allowed to sell wine from NY wineries, or perhaps bottles under a certain price point.  That would leave imported and other domestic wines from outside NY (plus hard liquor) as fair game for the liquor stores.  I don’t know.  NY wines get a (mostly) undeserved bad rap, and making them the “booby prize” in this contest of strength would only serve to further marginalize what the NY wineries are trying to accomplish.  Plus, offering cheaper wines to that kind of mass audience doesn’t help the wine industry as much as you’d think:  most wines under $7 or so are swill (Corbett Canyon comes to mind), and the more people buy it (’cause it’s cheap), the more they make, ultimately driving quality producers off the shelves and out of business.  A lot of bad wine is still just that – bad wine.

And, I didn’t even touch on Governor Paterson’s boneheaded proposal to TRIPLE the sales tax on liquor & wine sales in New York.  Ever heard the phrase “you can’t get blood from a stone”?

I must conclude, therefore, that I am NOT in favor of allowing wine sales in grocery stores.  As a matter of fact, I am in favor of loosening the restrictions of the NYS Liquor Authority even MORE – we should allow liquor stores to be open seven days a week, and allow business owners the right to own more than one store.  These ridiculously antiquated, Puritan-era restrictions are no good for business, and no good for New York.

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3 Comments leave one →
  1. Anonymous permalink
    April 28, 2009 8:02 pm

    Most of your argument makes alot of sense but the ending seems to contridict the overall argument. The idea that Liquor stores can’t have multiple locations and that they are only open 6 days a week actually keeps them small businesses. Seven days a week would actually be harder for small businesses and if one place is allowed to do it then they will all be forced by competition to follow suit. This would require hiring staff for slower days of the week which actually rises costs, and likely does not increase sales enough to make up for the new higher costs.

    Also, multiple locations would make it easier for big chains to jump and undercut the mom and pop places with lower prices.

    I’m not sure I would describe those laws as blue laws. If you are worried about mom and pop and small business, don’t they actually help those kind of business stay viable?

  2. wendalicious permalink
    April 28, 2009 8:49 pm

    I certainly do not claim to know a lot about business, so I will concede a couple points to you, “Anonymous”, since you have more experience than I in the retail world:

    -Owning several (read: more than 2 or 3) locations may well likely put you out of the “small business” category. BUT, staying a small business should still remain the prerogative of the business owner, not of the state. One should not be forced to limit expansion by non-market (government) influences. Here’s a for-instance: Stewart’s Shops started as a small business, but over time, through good business practices and consumer awareness, expanded the number of stores and has become a very successful LOCAL business entity (not necessarily a small business, but not a multinational corporation, either). Would you advocate forcing them to close all but 1 of their locations, just because you didn’t like what they sell? Even though everything they sell is legal? Of course you wouldn’t. The free market helped Stewart’s make the decision to expand. There was a need, and they filled it.

    -Being open 7 days per week would definitely add to labor costs and other overhead. But, again, this should be the choice of the business owner, not the state. There are plenty of viable businesses out there that are open fewer than 7 days a week, but it is the choice of the owner! Your favorite crepe shop is not open every day. Many many restaurants are closed on Mondays – not because they are forced to, but because being closed on Mondays is a calculated business decision. People don’t go out to eat very much on Mondays, and restaurant owners need some time off, too. Again, would you advocate getitng the government to close your favorite restaurant on, say, Wednesdays, because you though they were open too much? Of course you wouldn’t. Let the market decide. The liquor store owners know their customers – much more so than a grocery store does or would – and knows whether or not their store can support being open 7 days a week. If they can, then they should be allowed to!

    Does NYS put such restrictions on other types of businesses? No. Liquor is LEGAL. Sure, the state and localities may restrict the location of adult bookstores, but pornography is still legal and stores are allowed to be open 7 days a week. Why the hate for alcohol?

    Those laws are indeed remnants of the Blue Laws: a blue law is a type of law designed to enforce religious standards. They just changed it a little. The restriction of alcohol sales on Sundays was in effect until 2003 – almost 75 years after Prohibition ended! And, the sale of liquor or wine for off-premises consumption on Sundays has been banned since before Prohibition. Like other “blue laws,” the ban had its origins in more religious-oriented times when commerce on Sunday was thought to violate the Sabbath. I thought you Liberals were in favor of keeping God out of the government???

    The noose may be loosening, but the Women’s Christian Temperance Union still has a stranglehold on NYS liquor laws.

  3. Anonymous permalink
    April 28, 2009 9:00 pm

    My point wasn’t so much arguing the merits but pointing out that you are arguing on the one hand for the government to interfere with the market in favor of small business and on the other hand arguing that they are doing too much to limit business.

    If you allow multiple locations, why couldn’t you have the new Price Chopper Liquor store open right next to every Price Chopper in the state?

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