Will Tennessee Wine in Grocery Store Law Be Changed?

Will Tennessee Wine in Grocery Store Law Be Changed?

Strong popular support of wine in grocery stores was a key factor behind passage of the Tennessee wine in grocery store law this year (which we affectionately call WIGS).  We have heard that consumers do not like the fact that wine cannot be sold in groceries before July 1, 2016.

Ron Ramsey, the leader of the state Senate, was recently quoted as saying that consumers will be disappointed when they learn how long they will have to wait for wine sales.  Two years are an eternity for shoppers.

WIGS was a bloody compromise between competing forces - a battle we presume no one wants to revisit.

Michael Jackson knows it:

I'm Gonna Make A Change,
For Once In My Life
It's Gonna Feel Real Good,
Gonna Make A Difference
Gonna Make It Right . . .
Although convenience stores fought hard for WIGS, the 20% food requirement disqualifies nearly every C Store.  The definition of food in WIGS excludes prepared foods like grab and go breakfast biscuits, hot dogs, pizzas, chips, sodas and other snacks.  C stores do not sell enough flour, pasta and other food items that require cooking.

Pharmacies like Walgreens and CVS were also left high and dry by WIGS, with the 20% food requirement probably disqualifying every pharmacy in Tennessee.

We suspect that many business-friendly legislators will regret requiring an across the board 20% mark up on prices for wine.  Pro-business forces have to ask why the state is dictating prices.  For example, a 20% mark up on a $10 bottle of wine might be reasonable, but why require that a $100 bottle of champagne be marked up $20?

WIGS also prohibits discounting based on multi-store purchasing power.  This was a compromise to protect mom and pop liquor stores from the buying power of goliaths like Wal-Mart and Kroger.  Although it may make sense for WIGS, business-friendly legislators will face tough questions about interfering with the free market.

WIGS was a delicate compromise that took years to negotiate.  Like any other settlement, no one got what they wanted.  We suspect that any changes to WIGS will be difficult, if not impossible.

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