Would Frasier buy wine at King Soopers?

When grocery and convenience stores started stocking full strength and craft beers in 2019, it wasn't clear how Colorado's beer market would respond. The numbers were initially reported to be up by 20% and a new monthly record was set at 9.8 million gallons sold in January of 2019.

That was a 1.6 million gallon increase from the previous year. (Ben Markus, CPR News, May 14, 2019) If Proposition 125 passes this November, Colorado's grocery and convenience stores will be allowed to add wine to their shelves. The question now is - Will Colorado's wine consumption have a similar uptick or not?

In 2016, Colorado passed a law that would incrementally phase in grocery store sales of

full-strength beer, wine, and liquor, with all stores allowed to sell all alcoholic beverages by

2037. Currently, however, wine can only be purchased in licensed liquor stores. Colorado's Proposition 125 on the November 2022 ballot would allow stores already licensed to sell retail beer to begin selling wine for off-premise consumption beginning on March 1, 2023. The measure would also allow these shops to submit an application to their local licensing authority in order to conduct wine tastings on-site.

Thomas Valdez, manager and owner of Niwot Liquor at 361 2nd Avenue in Niwot, spoke about how his business was affected by the change in 2019 and what he thinks about the propositions on the ballot regarding alcohol sales. Valdez has owned Niwot Liquors for 37 years and he has seen a lot of change in the past decade and a half. "When Colorado got rid of 3.2 beer and grocery stores started selling regular beer, there was a 10% reduction in sales for 'mom and pop' liquor stores like mine," Valdez said. "Basically this industry has been under attack by grocery stores for a long time."

Talking about the changes and what drives these types of changes, Valdez said it is usually

about convenience and driving up revenues for the big box retailers. "This used to be almost a protected industry," Valdez said. "Each proprietor could have only one license– at that time 'mom and pop' stores were the ultimate business. But then the grocery stores started looking for bigger and better revenue and they looked at liquor sales in places like California and eyeing that revenue for Colorado's grocery stores."

The ballot initiative which most concerns Valdez's business is Proposition 125, and if passed, it would change alcohol sales policy in the state - including a policy that would let grocery stores sell wine. It qualified for the November ballot after supporters collected a sufficient number of voter signatures.

Millions of dollars are already being spent in support of Propositions 124, 125 and 126,

including nearly $2 million from U.S. Rep. David Trone (D. Maryland) and his brother, Robert Trone, who own the national Total Wine & More chain. The Trones are supporting Proposition 124, which would allow Total Wine to open more stores in Colorado, as reported by The Colorado Sun.

They have sufficient support, Valdez concedes, because Colorado has seen so much change

over the years. When Colorado passed legal marijuana, it was another 10% hit for small

and medium sized liquor stores. The common reasoning is that many people began using marijuana in favor of drinking alcohol for recreation and relaxation.

"People that grew up here in Colorado have always been used to our liquor laws," Valdez said. "You could get regular beer and malt beverages in liquor stores and if you wanted convenience, you bought 3.2 beer at the gas station or grocery store. Colorado is a transitory state, we have many folks moving from other places where they're used to buying everything in one stop."

Convenience might be a good reason for the initiative to pass, but what are the negatives for the consumer? Valdez spoke about people preferring an assortment when shopping for wine. "Generally, grocery stores will not carry the variety that smaller to midsize stores carry," he said. "Also, we're losing some of the intimacy that this industry can foster with consumers. We have employees that have worked here for 25 years, they know our customers personally. They talk to you about a new craft beer or a local wine and try to turn you on to something good. We've been here so long, we don't do too much business outside of Niwot anymore."

"'Mom and pop' liquor stores are destined to go away," Valdez said. "They're going after wine now and next it will be liquor. The way I see it, out-of-state folks want to make one stop to get their huge trucks loaded up, instead of stopping at a whole lot of little shops. Our customers are loyal and they always have been." Valdez continued, "We have the best customers in the world. They know, they're smart, if they want me here, they'll have to continue to support local businesses like mine."

Another negative side effect if the ballot measure passes, and Valdez is betting it will, is the number of jobs that will be lost. Valdez explained, "You look at a typical chain grocery store and it has a liquor store next to it. When the chain stores put beer in their stores, they didn't create one job. They didn't get a beer manager, they just added beer. They won't add any extra people. All those folks will just lose their jobs. People that want to be in the industry won't be able to do it. They are already changing their models and they've been getting ready for so long. They've been posturing for it and just waiting for another increase in sales."

Who is the typical wine drinker in Colorado? The character of the same name from the TV show, "Frasier" might come to mind, a sophisticate droning on about 'notes of cigar' or a Cabernet having 'great legs' (the streaks the wine makes on the glass as the glass is tilted). A 2021 Gallup poll concluded that the most common wine drinkers are actually college-educated women aged 55 and older with an annual household income of $100,000 and greater. That demographic is easy to find in our area. Let the voting commence.