The challenge dubbed “David vs. Goliath” is again brewing in Colorado between national grocery chains and independently owned liquor stores allied with the craft beer and wine industry.
Voters may be the deciding factor in the fight during the November 2016 election.
The question: Is it time to sell liquor, wine and full-strength beer in grocery stores? Colorado craft brewers, vintners, distillers and independent liquor store owners oppose the idea, saying it will cost jobs and hamper consumer choice.
Current state law restricts the sale of alcoholic beverages above 3.5 percent alcohol content to liquor stores. Technically, Colorado allows businesses only one liquor license to sell full-strength beer, wine and liquor. That means while a grocery chain may have many locations throughout the state, it may sell liquor at only one store.
After failing several times to change state law in the Legislature, proponents of selling liquor in grocery stores are planning to initiate the petition process to allow voters to decide.
State law stipulates that the number of signatures for a successful petition must equal 5 percent of the total number of votes cast in the previous election for the Colorado Secretary of State. Thus, proponents must gather 98,492 votes from valid electors to place an initiative on the ballot.
Cheers Liquor Mart owner Jack Backman opposes the measure.
“It’s bad for business. It would cut into my sales. I would have to cut between five and 10 people, maybe more,” Backman said. “[The] Safeway right behind me … would probably just add one job and I’m going to lose 10.”
Backman estimated his store’s sales of craft beer, wine and spirits would decline up to 20 percent.
“All those profits will suddenly go to Bentonville, Ark., [Walmart headquarters] and California [Safeway headquarters]. I think Kroger [King Soopers] is back East.”
If the law is changed, between 30 and 40 Colorado Springs liquor stores would be driven out of business, eliminating the jobs of several people per store, Backman estimated.
“Their only argument is convenience,” Backman said. “There’s a lot of people in this state from other places and they’re used to buying liquor in grocery stores.”
“It’s not a scare tactic. It’s real.” – Mike Bristol
If the law changes, Backman said, the self-checkout aisles in grocery stores will need more diligent staffers to ensure underage people don’t attempt to buy liquor or switch alcohol for other products before scanning. He also said prices will probably go up and selection will go down.
Craft brewers and vintners, including Mike Bristol of Bristol Brewing Company, also oppose the idea.
Large grocers want the same, familiar beer brands in all their stores coast to coast, and corporate buyers are not familiar with the local culture, Bristol said.
“Colorado consumers really like locally sourced product,” and that explains why the craft beer industry is booming in this state, he said.
Also, the argument that liquor is sold in grocery stores in other states doesn’t fly with him.
“Coloradans don’t really care about what happens in other states,” he said. “The system we have now works very well. We have a system set up now that fosters local business.”
Also, if people “truly understand the consequences,” they would oppose the measure.
“Just like my house is leveraged for this business,” Bristol said. “Now you’re starting to get personal — [affecting] someone’s livelihood, ability to send their kids to college. It’s not a scare tactic. It’s real.”
Denver firm EIS Solutions has been hired to build a coalition to support the measure, said Colorado Consumers for Choice spokesman Rich Coolidge.
“It hasn’t been successful in the Legislature. We’re in the planning stages right now and looking at the timing. Our goal is to get it on the ballot for next year,” Coolidge said. “Within the next couple months we’ll start looking at the next steps.”
As Bristol alluded, Coolidge pointed to California and Arizona, “who have beer and wine sales in liquor stores as well as grocery stores. We think that with increased competition, the consumer will benefit.”
Coolidge says the group is in the process of building a coalition in favor of the initiative, and is looking at options to engage as many voters as possible. One group is already on board: the Colorado Retail Council.
“Of course we support it,” said CRC President Chris Howes. “We have grocery members who support it. It’s our customers who have been asking for it. We want to be like most every other state in the nation.”
Howes brushed off the issue of job loss resulting from the move.
“They have a bunch of arguments that are hypothetical,” he said. “We point to other states in the country, like Arizona, California that have liquor sales in grocery stores.”
Proponents of a ballot issue are seeking signatures for support online at coconsumersforchoice.com.
“Since 1933, Colorado has limited the sale of wine and real beer to liquor stores, restaurants and bars,” the website said. “Since 1933, we have invented soft-serve ice cream, rock-n-roll, space travel, the Internet and the cellphone, but you still can’t buy real beer or wine in a Colorado grocery store in Colorado.
“It’s past time to modernize the state’s liquor code.”
By the numbers in Colorado:
Number of independently owned liquor stores: 1,595
Number of craft breweries: 287
Number of local wineries: 135
Number of craft distilleries: 46
Economic impact: $826 million
Number of employees: 15,000
(Source: Keep Colorado Local)