In the early days of the pandemic, revenues at The Violet Hour in Chicago had slowed to a trickle. This craft cocktail venue was already highly experienced in creating batched cocktails, due to a thriving events business.
So when the law changed to allow for cocktails to-go and cocktail delivery, the bar team jumped on the chance to secure their survival. “We immediately pivoted, and (to-go cocktails) were our sole income for a couple months,” says Terry Alexander, partner at The Violet Hour, who notes that unlike many states, Illinois does not have a food order requirement when selling drinks to-go. “That was all we were living on, basically.” The lounge quickly expanded its offerings and even launched a subscription service for cocktail delivery.
Fast forward to today, and to-go cocktails make up about 15% of total revenue at The Violet Hour, plus a bit more during the holidays when takeaway specialty cocktails grab the attention of consumers. It’s become a crucial part of revenue in a difficult time. “For us in Chicago, both the smaller and larger restaurants are really struggling right now,” Alexander says. “To take that away in Chicago would be really difficult for a lot of places.” Last spring, Illinois lawmakers passed legislation to continue allowing bars and restaurants to serve cocktails to-go. The measure is now set to expire on January 1, 2024.
Bars and restaurants in Massachusetts are facing a tighter window on their to-go sales, with the latest law allowing drinks carryout set to expire on May 1. Emma Hollander, co-owner of Starlite MGMT Co., which operates Trina’s Starlite Lounge and three other concepts, says to-go cocktails helped her company survive during the worst of the pandemic. They’re less important now, but still contribute to the bottom line. “It’s not the revenue that we were seeing a year or more ago, but anything that will make independently owned restaurants another dollar is something we need,” Hollander says.
Starlite Lounge and The Violet Hour are just two among thousands of restaurants and bars nationwide that have incor- porated to-go cocktails into their repertoire. Many on-premise venues see it as a solid revenue stream at a time of upheaval for the industry, and many state governments see benefits as well. As of mid-February, 17 states had permanent laws permitting cocktails to-go, and another 14 states had extensions of pandemic-inspired laws in place—a handful of those expire this year, but most extend to mid-2023 or beyond, according to the Distilled Spirits Council of the United States (DISCUS). Thus far in 2022, at least 11 states are considering legislation to either allow to-go cocktail sales permanently or to extend expiring or expired temporary measures.
DISCUS is working hard to expand those numbers further. “It’s a priority for sure,” says Chris Swonger, DISCUS president and CEO. “For those states that adopted it under emergency order, it makes it a little bit easier because they saw first-hand how it helped restaurants and how it can be done safely and appropriately.”
But while many states seem to be receptive to carryout cocktails, a few have reversed course after temporarily allowing the practice. New York, Pennsylvania, and North Carolina all let their temporary measures expire, according to DISCUS. In North Carolina, Jason Smith, chef and proprietor of Raleigh-based 18 Restaurant Group ramped up quickly when the state finally allowed cocktails to-go in late December 2021—months after many other states had made the move. But by June 1, the last of Gov. Roy Cooper’s executive orders allowing cocktails to-go had expired. “The cocktail to-go opportunity was on a month-to-month basis under a tempo- rary order,” Smith notes. “It was a great success for me, but seemed to require a lot of heavy lifting to get put in place permanently.”
Unlike in many other states, restaurants and bars in North Carolina apparently didn’t have much of an appetite for the opportunity. Jason Ruth, vice president of the North Carolina Bar Owners Association, told the local Citizen Times newspaper that only five of roughly 700 bars even tried selling to-go cocktails. “It wasn’t a huge game changer,” says North Carolina Restaurant and Lodging Association president Lynn Minges.
New York Standoff
New York, however, is a different story. There is a strong push from bars and restaurants to resurface the to-go cocktail allow- ance that was put in place in March 2020. That rule expired in June 2021. “Former Governor Cuomo was one of the first to put to-go cocktails in place, and sadly our off-premise part- ners didn’t like it, and it died in June of 2021,” says DISCUS’s Swonger. “But the new governor has resurfaced it. We really applaud the governor for recommending it as a policy.”
In fact, current New York Governor Kathy Hochul pushed for the measure in her January state-of-the-state address in Albany. “We’re also going to do something our bars and restaurants have been asking for, to once again allow the sale of to-go drinks, a critical revenue stream during the lean times last year,” she is quoted as saying. “So, cheers, New York.” But passage might not be simple. The Metropolitan Package Store Association is a powerful lobbying force in the New York state capitol, and it’s digging in its heels on the to-go issue. In a February statement, the MPSA noted the “arduous rules and regulations” have long governed sales of beverage alcohol at retail. “We believe that opening the door for large national franchises and restaurant chains, as well as tens of thousands of prepared food sellers across the state, to begin selling to-go wine and liquor creates a scenario that is untenable, impossi- ble to regulate and enforce, and will threaten the livelihood of thousands in our industry,” the organization says.
The MPSA also sought to quell the notion that off-premise retailers had thrived during the pandemic. “In sharp contrast to the assumptions of some persons, the pandemic has been responsible for major losses in many of our businesses, with a typical neighborhood wine and liquor store seeing foot traffic down 35%-50% and double-digit sales losses for a sizeable number of our stores,” the group says. “The proposed legislation would take what remains of these small businesses, their regu- lar customers, and hand them over to another industry that is not being compelled to follow the same burdensome regulations, for nothing in return. Essentially, we are being told there is no burden for us and, even if there is, just ‘take the hit.’”
An Open Tap
The broader industry is watching developments in New York closely, especially now that the governor has weighed in with her support. In many other states, the debate hasn’t been particularly heated, perhaps due to the fact that concerns about safety voiced by legislators in several states when initially debating the merits of to-go cocktails haven’t been realized. Swonger notes that DISCUS has consistently advo- cated for practices “guided by social responsibility” and it invested in training platforms to ensure front-line workers understood and adhered to strict rules so as not to contribute to drunk driving or consumption by minors.
Joseph Infante, a principal attorney at Miller Canfield, who leads the firm’s beverage alcohol regulation practice and is the co-founder and president of the Craft Beverage Lawyers Guild, says that given the success of to-go cocktail programs during the pandemic, he expects a normalization of the practice. “I think it will become part of the fabric because people will get used to it and legislators will see that the ‘parade of horribles’ hasn’t occurred.” By “parade of horribles,” Infante is referencing social ills due to irresponsible consumption.
Moreover, allowing to-go cocktails during the pandemic simply accelerated a trend already underway to liberalize laws related to alcohol beverage consumption, he says. “Every year, something gets a little bit more liberalized, there’s always some loosening of the beverage laws,” Infante notes. Regarding to-go cocktail legis- lation specifically, Infante says the experience over the past two years has paved the way. “I think most consumers want this and have become accustomed to being able to have their cocktails to-go,” he adds. “Most bars and restaurants want this, and it seems like there is a lot of support from legislators. It allows for creativity, and it’s another sales avenue for bars, restaurants, breweries, and distilleries, many of which are really struggling right now.”
Some states, like Infante’s home state of Michigan, have further liberalized their carryout drinks laws. In Michigan, cities can open “social districts” that allow consumers to openly carry drinks within the confines of those set areas. “I can get a cocktail from a bar in a to-go glass, then walk around downtown Grand Rapids or go to the parks with my drink,” he says. Another development that’s pushing the liberalization trend is the ongoing labor challenges nationwide. “Bars and restaurants don’t have a lot of staff right now,” Infante says. “They benefit when people pick up food and drinks to-go because it’s a one-touch transaction.”
As the pandemic eases, opinions are mixed as to whether to-go cocktails will be an important component of a restaurateur’s toolbox. Hollander isn’t convinced they will be. While she welcomes the opportunity to sell, she’s not particularly motivated to fight for another extension to Massachusetts law, nor does she believe her on-premise colleagues are. “I’m part of Massachusetts Restaurants United and it and other groups have really been working hard to get funding and extend patios and extend cocktails to-go,” she says. “At this point I think restaurateurs are so exhausted from fighting for what we need to keep our businesses open that we’re not fighting this one anymore.
“At this point, the issue of to-go cocktails is on the back burner of our effort, because we’re looking for funding and support,” Hollander continues. “I think that everybody welcomes to-go cocktails and nobody sees it as a negative thing. I just don’t think that this far into the pandemic, we have the energy to fight for it. We need to pick our battles.”
In Chicago, expiration is still more than two years away, and by then, Alexander believes it will be part of the fabric of running an on-premise business. The Violet Hour team has now fully incorporated to-go drinks and expanded with a cocktail subscription service, cocktail making Zoom classes and parties, cocktail kits for local and national distribution, and other initiatives. Other restaurants and bars under the parent company One Off Hospitality’s umbrella have also embraced the change. Big Star Mexican restaurant “does really well with Margaritas when people grab food to-go, and even our high-end restaurants all have cocktails to-go,” Alexander says. He thinks over the next two years having the option of ordering cocktails to-go will become ingrained in people’s expectations. On a national scale, Swonger hopes the same.
“Let’s hope in three months’ time we’re all back in bars and restaurants, meeting with each other and spreading cheer and connecting with people,” says Swonger. “Even then, there’s going to be a contingent of consumers who want to entertain at their home. And that is awesome. Cocktails to-go would be a safe and cool way to be able to do that—that’s why we’re on point in trying to make these laws permanent, always guided by the responsibility side of it.”