Grocery Sales of Wine Hit Liquor Stores

Grocery Sales of Wine Hit Liquor Stores
The wine shelves of Arkansas Krogers, such as this one in North Little Rock, have grown more robust since the Legislature loosened restrictions on what grocery stores could offer. (Gwen Moritz)

As of July 3, the Arkansas Alcoholic Beverage Control Division had awarded 334 permits for “grocery store wine,” the permits that allowed grocery stores and other retailers to sell an expanded selection of wine.

The retailers range from grocers like Kroger and Harps to every variety of Walmart store to convenience stores like Kum & Go to the New Blaine General Store in Delaware (Logan County). Even Walgreens and CVS stores have gotten in on the act. They’re taking full advantage of Act 508 of 2017, which allows grocery stores in “wet” counties to sell an expanded selection of wine and which went into effect Oct. 1. It generated bitter opposition from many liquor stores in Arkansas.

John Akins, president of the United Beverage Retailers of Arkansas, which represents independent wine and spirits stores, has commissioned a report on the impact of the law, but it wasn’t ready as of last week. Anecdotally, however, in heavier wine markets like central and northwest Arkansas, liquor stores have noticed around a 20 percent decrease in their wine sales, said Akins, owner of Legacy Wine & Spirits of Little Rock.

Update: The report is out and shows an average sales decline of more than 5 percent.

In addition, he said, though he doesn’t have hard figures, a number of liquor stores in Pulaski County are up for sale and he knows of some that have gone out of business. “A lot of the stores that are going out [of business] were probably already struggling as it was,” Akins said, “and this was just the nail in the coffin.”

Tim McCormack, adult beverage manager for Kroger’s Delta Division in Memphis, in an emailed response to my questions about Kroger’s wine sales, said:

“While I am not at liberty to quote sales figures, I can tell you we are very pleased by the success of adding the additional wine to our stores. But more importantly, our customers have expressed genuine appreciation for the offerings they are now able to purchase. Customers thank us personally for providing this added convenience to their shopping trip.

“The percentage growth in sales of current wines being offered versus only the small farms wine previously offered has been significant. This is an affirmation that the consumer wanted the opportunity to purchase a larger and more varied assortment of wine where they shop for groceries.”

As Arkansas Business noted in a story in May 2017, big chains like Walmart, Target, Kroger and Safeway, responding to ever-increasing competition both off-line and online, are working to break down the decades-old barriers that states erected to restrict alcohol sales after the repeal of Prohibition.

And package liquor stores — like retailers everywhere — are facing a new and challenging environment.

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