Loosened restrictions on beverage alcohol retailing during the Covid-19 crisis are leading to permanent changes and the blurring of lines between the on- and off-premise nationwide. Covid-19 emergency responses included temporary relief measures in 30 states and Washington, D.C. that permitted restaurants and bars to sell cocktails to-go. “State legislatures have stepped in to ensure these measures are made permanent or extended to support the recovery of the hospitality industry,” says David Wojnar, senior vice president and head of state public policy for the Distilled Spirits Council of the United States. He notes that seven states and Washington, D.C., have made cocktails to-go permanent, four states have passed laws extending the measure, and 23 states are considering legislation to either extend the provision or make it permanent.
However, some beverage alcohol retailers anticipate to-go cocktails from the on-premise to end once pandemic states of emergencies are lifted. “We worked with the restaurant association in Massachusetts and our wholesale partners to allow this temporary cocktails-to-go legislation,” says Rob Mellion, executive director of the Massachusetts Package Store Association. “When the emergency is over, we’re going to go back to the way things were to restore balance. What frequently gets overlooked is there are only so many potential consumers.”
Covid-19 emergency measures have triggered a tidal wave of proposed legislative changes nationwide. In New York, the Metropolitan Package Store Association opposes a proposed legislation to make carryout cocktails from restaurants and bars permanent. Mellion notes that in Massachusetts 110 bills regarding the beverage alcohol industry have been introduced in 2021, including some looking to extend cocktails to-go. By comparison, the last two legislative sessions saw 81 and 30 beverage alcohol bills, respectively.
Iowa, which was the first state to make to-go cocktails permanent, is now seeing numerous bills in the state legislature aimed at expanding beverage alcohol retailing. Among Iowa legislation, HF766 permits third-party delivery of beverage alcohol by companies like Drizly, Uber, or DoorDash from retail licensees and permittees, while HF768 would allow in-state producers an additional retail location. Brian Duax, vice president of Central City Liquors in Des Moines, Iowa, says cocktails to-go from the on-premise have slowed considerably since last year and there is no apparent impact on his retail sales. “It hasn’t affected us at all in retail,” he adds.
In fact, Central City Liquors increased its revenue by 35% last year, with Bourbon sales doubling and leading the charge. The No. 1 SKU for the third consecutive year at the store in 2020 was the Fireball 100-ml. ($2). The company also has a separate wholesale arm because beverage alcohol retailers are permitted to sell to the on-premise in Iowa. “I see both sides,” Duax says. “Most people are not still doing a ton of to-go cocktails.”
Nationwide, two other major pandemic-driven trends are beverage alcohol home delivery from retailers, bars, and restaurants and direct-to-consumer shipping from distilleries or online retail platforms. Prior to the pandemic, delivery from off-premise beverage alcohol retailers was permitted in 26 states and Washington, D.C. In response to Covid-19, 13 additional states allowed home delivery from off-premise retailers, including seven states passing permanent laws. Delivery from restaurants and bars prior to Covid-19 was allowed in four states, and now it’s currently permitted in 25 states plus Washington, D.C., while seven states have passed permanent delivery laws—providing further proof of the industry’s adaptability.