Recent Alabama legislation—HB 168, sponsored by state Rep. Reed Ingram—has allowed for local municipalities to authorize Sunday spirits sales without legislative approval from state lawmakers. Despite this shift, the control state’s 174 Alcoholic Beverage Control (ABC) retail stores—estimated to account for two-thirds of all statewide off-premise spirits sales—will remain closed on Sundays. “This means that only about 20% of the Alabama population has access to retail stores on Sundays that sell spirits,” says David Ozgo, senior vice president of economic and strategic analysis at the Distilled Spirits Council. Although there are more than 600 private liquor stores in Alabama, the state’s ABC stores appear to have a competitive advantage. “In revenue terms, the state stores are in more ideal locations,” Ozgo says.
While limited, Sunday spirits sales aren’t new to Alabama, accounting for an estimated several million dollars annually. Ozgo estimates that if Sunday sales were permitted across the entire state, including at ABC stores, the incremental revenue at the retail tier would be $15 million-$20 million. “Given the taxes and markups on spirits in Alabama, the state net—whether it’s profit or taxes—is probably $10 million,” he says.
Many consumers are seemingly unaware that some non-state liquor retailers are open on Sundays. Since its debut in June 2018, LeNell’s Beverage Boutique in Birmingham’s historic Norwood neighborhood has been open seven days a week. Owner LeNell Camacho Santa Ana notes that Sundays don’t see much customer traffic, but it’s worth remaining open. “Many people don’t expect us to be open, and are appreciative when they discover that we are,” she says. “Sunday traffic will grow as more folks find out we’re open.”
Camacho Santa Ana bases this perspective on her experience operating a liquor store in Brooklyn, New York; she saw much success when the Empire State changed its liquor laws in 2003 to allow Sunday sales. “Sunday was our second busiest day in New York,” she says. “That’s not the case here, currently, as people assume we’re closed and are shocked to find out otherwise.”
If a consumer doesn’t live in one of Alabama’s larger metropolitan areas such as Birmingham, Montgomery, or Huntsville, they could be hard pressed to find a private spirits retailer open on Sundays. This fact, coupled with the high cost of spirits, convinces customers to travel outside of the state to purchase beverage alcohol. According to the Washington, D.C.-based Tax Foundation, Alabama has the fourth-highest excise taxes of U.S. states on spirits, which are given a 35% markup followed by a 56% state tax and a 6% sales tax.
“Ultimately, Sunday sales are all about convenience,” Ozgo says. “In a state like Alabama, it’s particularly important because there’s such a high markup and high taxation; they have a lot of border bleed. Even though there aren’t huge populations by the borders, a lot of people will drive a couple of hours into Florida, stock up on spirits for the year, and then drive back.”
Changes regarding retail sales of beverage alcohol come slowly in a state where 26 of 67 counties are dry. Within many of the so-called dry counties, however, are wet cities. The contradicting wet and dry classifications make for some unusual local ordinances; in Greene County, for example, Sunday beverage alcohol sales are only permitted within the Greenetrack dog and horseracing track and gaming center.
Since 2002, 21 states have adopted legislation allowing Sunday spirits sales. States prohibiting Sunday retail spirits sales include Mississippi, Montana, North Carolina, South Carolina, Texas, and Utah. “If you’re not open on Sundays you’re at a competitive disadvantage, because surveys show it’s one of the busiest shopping days of the week,” Ozgo says. “Being open on Sundays makes it more likely that people are going to take advantage.”