Business

Groups renew Colorado's brew brouhaha

Sales in grocery stores debated

Posted 11/1/15

While supermarket chains and even some breweries across Colorado are hopped up about the idea of allowing all grocery stores to sell full-strength alcoholic beverages, some neighborhood liquor stores have a case of sour grapes about the whole …

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Business

Groups renew Colorado's brew brouhaha

Sales in grocery stores debated

Posted

While supermarket chains and even some breweries across Colorado are hopped up about the idea of allowing all grocery stores to sell full-strength alcoholic beverages, some neighborhood liquor stores have a case of sour grapes about the whole thing.

Forty-two states allow full-strength liquor sales at all grocery stores. But because liquor store owners may only operate one location under Colorado law, each grocery chain has to choose just one store. Safeway, for instance, chose the Littleton location at Mineral Avenue and Broadway, where a security guard stands watch over a large liquor department at the rear of the building.

Other locations, as well as convenience stores, are restricted to selling 3.2 percent alcohol products, like beer and wine coolers. So for now, liquor stores have the upper hand when it comes to selling the hard stuff. There are around 1,600 of them in Colorado, employing somewhere around 15,000 people.

The topic comes up now and again in Colorado, with the last time being in 2007, when the ban on Sunday sales was lifted. This time, the effort has enlisted the help of two people with south metro-area name recognition — John Brackney, former Arapahoe County commissioner and former president of the South Metro Denver Chamber of Commerce, and former Arapahoe County Sheriff Grayson Robinson.

The two helped kick off the “Your Choice Colorado” campaign on Oct. 21 in front of the liquor display at the Glendale King Soopers.

“Your Choice Colorado aims to reform Colorado's Prohibition-era alcohol laws via legislation or a ballot initiative in 2016 to provide consumers with the option to purchase real beer and wine in their neighborhood supermarkets,” reads a news release.

What opponents say

Not everyone loves the idea — small, independent liquor stores, for example. Dozens have signed on to “Keep Colorado Local,” along with a number of breweries, distilleries and wineries.

“Out-of-state corporations are interested in changing the way we do business in Colorado by allowing all chain grocers and convenience stores to sell alcohol,” reads the website. “Their goal is to boost profits. What they won't tell you is that the effort will send money out of our communities, force hundreds of small businesses to close, curtail Colorado's thriving craft industries, undermine safety and give underage kids more access to alcohol.”

Littleton's 38 State Brewery, the city's first, is at the top of the list of the movement's supporters. Open for two years, it just expanded from a single-barrel capacity to seven, and the owners and staff worry that it might get its legs knocked out from under it while it's just learning to walk.

“If convenience is the No. 1 consideration, well, is it convenient to put all our liquor stores out of business?” said Steve Schuett, manager. “In our case specifically, it will hurt our distribution. We're in our infancy. Now we just go to the stores, drink our beer with them, shake hands and get our beer on their shelves within a week. I don't have a distribution company fighting for me. If we can't charm them in that way … selling a product via email is not really what sharing a beer is all about. … It's just not the Colorado spirit. It's not the craft brew way.”

Schuett notes that Anheuser Busch recently bought MillerCoors, pending final approval by regulators, and will have 30 percent of the global market.

“We're fighting monopolies like you can't believe,” he said. “If the monopoly gets ahold of the big chain stores, how big is that fight going to be?”

Mark Mack, owner of the busy neighborhood Woodlawn Liquors in Littleton, also worries for his future.

“We have several hundred liquor stores in the Denver-metro area right now,” he said. “Probably in the first year, there will only be about 100 left. We can't compete. Think of all the jobs that will be lost, and not just at the liquor stores, but at the beer companies, the wine companies. The small, wholesale distributors will vanish. Selection will vanish. Customer service will be gone.”

Jesse Vance owns Advance Liquors in the shopping center just south of the Safeway that carries full-strength alcohol. It is anchored by a King Soopers, so he predicts a struggle should the law change. If it does, he'd like it to include a provision for the chain to buy out his license.

“The way it is now for the independent stores, we're not allowed to collaborate with each other to increase our buying power,” he said.

A big part of his business is selling beer from breweries like 38 State.

“But wait until they try to get it into a corporation,” he said. “I try to support the small guys as much as possible, because I'm a small guy. … I've got my life savings into this place.”

What supporters say

St. Patrick's Brewing Co. in Littleton is one of the exceptions among breweries.

“We're for it,” said co-owner Dave Barron. “We think it gives us more opportunities to distribute our beer, and it gives us bigger outlets. … (Other breweries) think the grocery stores are going to bring in more imported beer. But we're the Napa Valley of beer, so I don't think that's going to happen. … We do more sales on site now, but we're cultivating and working on our wholesale in order for us to grow our business the way we want.”

The grocery chains themselves say that want to keep a focus on local products.

“We see ourselves as Colorado's neighborhood markets and take great pride in highlighting locally sourced products and entrepreneurs,” said Kelli McGannon, public affairs director for King Soopers, during the Glendale event. “We want to support Colorado's booming beer scene and blossoming wineries, and provide these great products to our customers, who are clamoring to buy them.”

McGannon was joined by Russ Novotny, Safeway's regional liquor sales manager, and Michael Cooke, former Douglas County Commissioner and executive director of the Colorado Department of Revenue and the Colorado Department of Regulatory Affairs, along with Brackney and Robinson.

Brackney notes that even though Colorado is home to the third-largest number of breweries per capita in the country, it's one of only eight states where people can't buy their beers in the grocery store.

“We've seen the rise of consumer-driven conveniences like ride-sharing and online retail, healthcare and banking, yet we still have to travel to two different stores just to complete a dinner,” said Brackney. “These outdated laws prevent our thriving craft breweries from entering grocery store shelves and prevent consumers from having the choice, convenience and competition that would benefit their family budget and tightly packed schedules.”

As to the allegation that kids would have more access to alcohol at grocery stores, Robinson noted it's already being done.

“Grocery stores are great partners in the community and will be a safe place to sell beer and wine,” he said. “When I was sheriff, there were numerous grocery stores that chose to place their one location with a liquor license in areas under my jurisdiction, and they never gave me any problems.”

Luke Ouellette is the manager at Davidson Liquors, itself the size of a grocery store. He says he'll reserve judgment on any legislation until he sees exactly what it says. The store has been in Highlands Ranch since 1998 and survived the 2007 changes, when one grocery store in each chain began selling hard liquor.

“We maybe saw a slight decrease in business, but not dramatic,” said Oullette.

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