Our office has proposed some changes to the state laws regulating what liquor stores can sell. Since NY only allows a single package and wine store license per person, the ability to grow the business is severely restricted. The profit margins are slim and the system. There has been a debate on whether wine should be sold in grocery stores. I am not expressing an opinion on that issue right now, but the package and wine store owners vehemently oppose this change in the law because it will severely cut into their profits. They are right. After all, they are regulated to the point they can’t sell much more than just wine and liquor.
The current law is not designed to promote the recent growth of the artisan spirits industry which needs a mainstream retail distribution channel to flourish. The laws are being changed for the manufacturers, but not the retailers. The foodie trend and locavore movement are here to stay. Realizing that the food and beverage production industry is responsible for job growth and tax revenues, New York is spending its own resources to promote these businesses. Except the politicians have forgotten about this important part of the distribution chain. By not allowing package and wine stores to appeal to the sophisticated consumers and foodies, they have no way to differentiate themselves from others. Allowing these businesses to do what can be done in other states will make our businesses stronger and fuel growth industry-wide.
I am not suggesting no regulation. I am suggesting changes that make sense in today’s world and align with the other changes in the ABC laws that have been taking place for craft beverage producers. After hearing the concerns of some of our clients, we have proposed:
- the expansion of products sold to include things that naturally go with alcoholic beverages – glassware (for more than just wine glasses), barware (more than just cork screws and bottle stoppers) and mixers, bitters and simple syrups
- to allow the sale of gift baskets and gift bags
- expand the products that can be sold to include those that a farm licensee would be allowed to sell (limited to NY local agribusiness and tourism related products)
- expand the publications that can be sold to include more than just wine education
- allow loyalty programs and membership based wine or spirits clubs
- allow education classes and wine pairings to be offered for a fee
A draft of a proposed law was sent to Sen Rohbach’s office and is being reviewed by his legislative director. The text we sent is pasted below. We at Tracy Jong Law Firm want to start a discussion on this issue. Please provide your feedback to us so we can share it and continue the discussion. All sides of the issues need to be considered. We want to hear the good and the bad.
Alcoholic Beverage Control Law § 63.
4. No licensee under this section shall be engaged in any other business on the licensed premises without consent of the State Liquor Authority. The sale of the following products and services shall not constitute engaging in another business within the meaning of this subdivision:
lottery tickets when duly authorized and lawfully conducted, corkscrews, aeration devices, cooling devices and devices designed to minimize oxidation in bottles of alcoholic beverages which have been opened, ice, publications, subscription services, memberships, loyalty programs and education in the form of live, webinar or prerecorded content designed to help educate consumers in their knowledge, use, consumption and appreciation of alcoholic beverages, including recipes and food and beverage pairing, and material to assist wine and cider-makers and home wine and cider-makers to produce and bottle wine and cider, mixers, simple syrups, garnishes, bitters and other products used in the preparation or consumption of alcoholic beverages and cocktails, glasses, barware, serving ware, supplies and decanters designed for the storage, serving or consumption of alcoholic beverages, or for decorative purposes, racks designed for the storage of alcoholic beverages, barware, serving ware or alcoholic beverage glasses, gift bags, gift boxes and gift baskets for alcoholic beverages, gift items incidental to the sale of alcoholic beverages limited to food items, condiments and products for the purpose of complimenting alcoholic beverage consumption and tastings, which shall include locally produced farm products and any food or food product not specifically prepared for immediate consumption upon the premises, and wine-making and cider-making equipment and supplies including, but not limited to, home wine-making and cider-making kits, presses, pumps, bottling equipment, filters, yeasts, chemicals and other wine and cider additives, storage or fermenting vessels, barrels, tools and devices, and gift baskets or packages combining alcoholic beverages, food products and other products or services authorized by this subdivision.