Pinot, Pork Loin and Consumers: The Grocery Store and Wine Debate

Posted by Tom Wark on Jan 4, 2013

Seventeen states ban the sale of wine in grocery stores. Seventeen.

The question this brings to mind is this: Is this policy of prohibiting consumers from purchasing a Pinot when they purchase their pork loin justifiable?

I’ve been pondering this as at least four states gear up to look at their wine-in-grocery store policy in 2013: Kansas, Kentucky, New York, and Tennessee.

What’s fascinating is that this debate never happens over the issue of “is the current policy justifiable”. Do have that discussion one would first need to go back some decades and determine the rationale for prohibiting wine sales alongside food in the first place. invariably, that exercise leads to the discovery that the original rationale is either hard to discover or the circumstance underlying the original rationale (usually market conditions and economic structures) are no longer in place.

No, today, the issue of wine in grocery stores is debated along two lines:

1. Allowing wine to be sold in grocery stores would be a huge convenience to consumers

2. Allowing wine to be sold in grocery stores would economically harm liquor stores where wine is currently only allowed to be sold

It’s notable that nobody disputes the former argument, made regulatory by the proponents of wine sales in grocery stores, including grocery stores and consumers. Nobody disputes it. A grocery store owner in Kansas who supports the idea of selling wine in his store puts it this way in a recent article on the subject:

“Very often people come in and ask, ‘Where’s the wine? I want that with my supper tonight.’ I have to inform them that we aren’t allowed to sell wine in the grocery store because it’s Kansas,” Hy-Vee Store Director Kevin Osterhage said.

I took considerable time recently to try to effectively argue the contrary, that consumers would not be benefited by being able to buy Pinot and Pork Loin in under the same roof. The only thing I could come up with is that it is much more likely for a consumer to get more personal and informed service in a store that is dedicated to selling wine than in a store dedicated to selling everything we put down our gullet. But this isn’t an issue of convenience. It’s an issue of communications. There simply is no way to counter the argument that consumers are better served via wine being sold in grocery stores.

This is why opponents of wine in grocery stores (most often liquor stores and wholesalers) prefer to argue the issue over the issue of the harm it would cause liquor store owners if consumers no longer were forced to enter a second store to get a bottle of wine with dinner. In a recent article about the effort to change the law in Tennessee, Josh Hammond, owner of Busters’ Liquors & Wines in Memphis and president of the Tennessee Wine & Spirits Retailers Association, made the case like this:

“Wine and spirits retailers will have to lay employees off and many will have to close. Where will the jobs come from? Certainly not the grocers. They’re not adding square footage or shelf space. They won’t need to hire one extra person.”

Here is what’s unquestionable: If a state changes its law to allow the sale of wine in grocery stores, consumers not only support the law, but they also benefit from the law. On the other hand, it is unquestionable that some people currently buying wine in liquor stores will, under a new law, choose to take their wine business to grocery stores.

What’s a law-maker to do?

This is the crux of the issue for a lawmaker in Kansas, Tennessee, New York or Kentucky faced with a bill that opens wine sales in grocery stores. Support liquor stores or support consumers. There are ways for bills to be written that mitigate the harm that may come to liquor stores. For example, allow them to now sell a variety of goods they are not allowed to. Or, in some states the law says a liquor store owner may only own one store in the state. That too could be expanded to allow liquor store owners to expand their store holdings. Yet these two ways to mitigate potential harm to liquor store owners, despite giving cover to lawmakers voting with consumers, is almost always dismissed by liquor store owners as no real help.

What’s a law-maker in one of these states to do?

This is where the consumer must come in. A vocal, loud and ongoing call by consumers to allow wine in grocery stores is the key to passing wine in grocery store measures. The interests of the consumer and the desire of the consumer need to be harnessed and communicated in order for law makers forced to decided how to vote on a bill to be convinced that the overriding concern here, the most important concern, the concern higher on the pecking order is the consumer.

I can count the instances on one hand in which an organized consumer movement made the difference in the passage of pro-consumer legislation related to access to wine. Almost always, any pro-consumer measures that pass and help the wine consumer are done legal decision force the issue or because  a combination of media pressure and the potential that not passing pro-consumer laws would actually hurt some businesses.

The issue of direct shipping is most relevant here. In the wake of the 2005 Granholm v. Heald Supreme Court decision, states were told they either had to allow wineries everywhere ship to their citizens in-state, or allow no wineries anywhere (including in-state) ship to their citizens in-state. In most states, the local wineries already had the right to ship while out-of-state wineries had to right. In order to continue to keep out-of-state wineries from shipping in, lawmakers would have to take the privilege away from in-state wineries. That amounted to setting the boot down upon what were almost always a collection of family farmers and family run businesses. Lawmakers decided they were safer standing up for family farmers than for big wholesalers who wanted out-of-state wineries prevented from shipping. But it was not really a matter of what consumers wanted that led to opening up direct shipping for out-of-state wineries.

Maryland was a good example, on the other hand, of consumers getting the job done. it took more than three years for consumers, under the banner of Marylanders for Better Beer and Wine Laws, to get their message across and overcome opposition to allow direct shipping from wineries. But they did it with consumer pressure.

If wine lovers and consumers who like a glass of wine in Tennessee, Kansas, New York, and Kentucky want to see Pinot near their Pork Loin, they better speak up. They better speak up loudly. If they do, they’ll get what they want. If they don’t, lawmakers will see little reason to protect and stand up for the interests of the most important constituent: The Consumer.