Will Cheek Discusses Hot Topic: Krogering for Wine

Krogering for Wine

By William T. Cheek, III
Alcoholic Beverage Group Team Leader

Much to the chagrin of many Tennesseans, the Tennessee Legislature has tabled a bill that would have allowed the sale of wine at retail food stores.  Although similar bills have been introduced in the legislature for years, this year’s legislation had strong support from grocery and convenience stores.  Sponsors of the bill engaged a new lobbyist and hired two reputable public relations firms.  The bill received considerable attention in the Nashville media and broad coverage in other major media markets throughout Tennessee.

With the legislative session approaching recess for the year, don’t look for wine at your local grocery store any time soon.  The sponsors are likely to press for approval of wine sales next year.

The sale of wine at grocery stores is controversial because of moral issues, as well as a complicated set of laws that governs how wine is currently sold.  Since enactment of “modern” day liquor laws in 1963, state law treats wine like whiskey and other spirits. 

The laws significantly limit the sale of wine and spirits.  For example, in Tennessee, a liquor store cannot sell beer, cork screws, wine glasses, mixers, cheese or other items.  Liquor store owners must be Tennessee residents and can only own one liquor store.  If a liquor store owner wants to sell beer, cigarettes, ice, mixers and other items folks might want to buy when purchasing wine or spirits, the owner must set up a separate company, lease separate space and operate a separate store.

Grocery and convenience stores tend to be owned by large companies and operate several stores in a market.  Most grocery stores and many convenience stores are owned by out of state corporations.  There are very few restrictions on what a grocery or convenience store can sell.

From a liquor industry viewpoint, the bill proposed this year was unnecessarily unfair to liquor store owners.  The bill would have allowed large out-of-state corporations to sell wine without complying with most of the key restrictions imposed on Tennessee liquor store owners.  The bill did not change the restrictions imposed on liquor stores. 

The marketing efforts behind the campaign were also problematic.  Public relations and lobbying efforts promoted the law as a way for consumers to buy wine with their food.  The group launched a website at www.redwhiteandfood.com, describing Red White and Food as “a campaign to allow Tennessee retail food stores the choice of selling wine to their customers.”  The Red White and Food sponsors did not advertise that the bill also allowed wine to be sold at convenience stores, which was apparently perceived as being more controversial.  The concept of buying wine at the grocery store to drink with dinner has more curb appeal than promoting a bill that allows consumers to pick up a bottle of cheap wine with cigarettes and a lottery ticket.  Tennessee has historically favored the sale of wine and spirits with a meal, which is generally accepted as promoting responsible consumption of alcohol.

The liquor industries’ marketing efforts were also less than forthright.  Media reported that the liquor wholesalers funded a “grass roots” campaign against teenage drinking known as Tennesseans Against Teen Drinking.  The group’s website sent a flood of emails to legislators, which lead to an official lobbying investigation.  The website has a “petition” that was – at least at one time - automatically sent to legislators.  The petition described the wine bill as follows:

"Wine in Grocery Stores – This bill would put wine on the shelves of grocery and big box stores across the state – and right in the line of sight of any teenager entering their doors. The state Fiscal Review Committee estimates 2,700 new stores will be able to sell wine — more than 5x the number that can sell it today. The alcohol content of wine is at least double that of beer, and studies show that more minors experiment with wine than beer."

As of press time, the group’s internet site was www.stopteendrinkingtn.org.

Look for more wine action in the legislature next winter.  

To sign up for The Tennessee Liquor Observer, Bone McAllester Norton's Alcoholic Beverage Practice Group E-News, please email wcheek@bonelaw.com. 

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