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Retailers, Customers Welcome Wash. Private Liquor Sales

Mon, 06/04/2012 - 1:51pm
ELAINE THOMPSON and SHANNON DININNY,Associated Press

Customers lined up Friday at retail stores across Washington to buy spirits for the first time outside state-run stores, and retailers highlighted their liquor deals with full-page newspaper ads, radio spots, banners and special events.

Many stores reported brisk sales on the first day of liquor privatization, but more than one manager bemoaned slim supplies with the same refrain: "Now, if we could just stock the shelves."

"The big guys are getting first choice, and we get what's left," said Chris Brown of Wray's Thriftway, an independent grocer with three stores in Yakima. "It's just difficult initially. Unfortunately, that's the norm anymore."

Many customers weren't complaining.

"It's a great thing to give people the opportunity to go places other than state stores to buy liquor," said Denise Elgenson, 56, of Seattle, who moved to Washington a year ago from California.

Private retailers have been selling liquor for years in California.

At a Costco Wholesale Corp. store in Seattle, Elgenson was checking prices on vodka and tequila for the appletinis and margaritas her husband makes her at home.

"It was surprising to me that Washington had such control over alcohol," she said. "This is so much more convenient."

Last fall, voters kicked the state out of the liquor sales business for the first time since the end of Prohibition by approving Initiative 1183, which allows stores larger than 10,000 square feet to sell spirits. Smaller stores in some areas also can conduct such sales.

Supporters touted the initiative, backed by warehouse giant Costco, as a free-market reform. On day one, prices were all over the map: Some much higher, some slightly lower, and some close to the state's prices on Thursday.

"We were all guessing at pricing," Brown said. "Now that we've all seen what everybody else is doing, everyone will be making changes. There will be a lot of flux in the next couple of weeks."

The initiative imposed an additional 10 percent distributor fee and a 17 percent retail fee on spirits to reimburse the state for millions of dollars in lost revenue. Big-box stores can negotiate volume discounts for some products or sell their own labels. But distributors have exclusive rights to handle some spirits, and volume discounts for those products may not be as widely available.

Rusty Figgins, master distiller for Seattle distillery Batch 206, said prices for its vodka and gin were slightly lower at Costco than state stores.

A $24.95 bottle at state stores rang up at about $24.50 at Costco.

Figgins started his own distillery in Ellensburg before being lured to Batch 206. His family is well known in Washington's wine industry.

Batch 206 supported Initiative 1183, he said.

"Private enterprise is something we're big on, and the state distribution system really hindered that," Figgins said. "A move like this takes the demonization out of not just sales of alcohol, but also consumption of it."

Many stores celebrated the change with special events, including a Seattle grocery store that held a midnight party where dozens of people showed up early Friday to be the first to buy liquor from a private retailer.

Batch 206 was on hand at five Costco stores to sign bottles and educate customers about the new fees, wishing them a "Happy Repeal Day!"

Many stores saw brisk business, despite only quarter- to half-full shelves.

At Wray's in Yakima, Brown said the store will be stocking products from local and regional distillers in the weeks ahead. The store has long been known for its wine department, which includes a large selection of Washington wines, drawing customers from as far as Seattle.

"If I had known the two main distributors were going to be out of so much, I'd have stocked that now too. I thought we'd bring in the basics first then add all the toys and trinkets," he said. "I guess I should have brought my toys in, too."

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