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Wine hits shelves across Colorado grocery stores as liquor store owners brace for economic impact

Among uncertainty, liquor store owners say they'll pivot business model to adjust for increased competition
Posted: 9:00 AM, Mar 01, 2023
Updated: 2023-03-01 19:21:45-05
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DENVER – Coloradans heading to their preferred grocery or convenience store Wednesday will be greeted with a new addition lining the shelves: Wine.

Employees across Colorado grocery stores were hard at work just after midnight stocking the shelves with everything from rosés to sparkling wines and dry reds as Proposition 125 takes effect. The measure, which narrowly passed in November, allows for the sale of wine at grocery and convenience stores.

Grocery stores weren’t the only ones anticipating March 1. Small mom-and-pop liquor store owners who spoke with Denver7 said they still weren’t sure how this change will end up impacting their livelihoods.

“We’re going to pivot accordingly,” said Bruce Gallagher, owner of Bonne Brae Liquor in Denver. “Pivoting could entail for us completely discontinuing a bunch of wines that are grocery-bound, it could be more emphasis on our spirits section, it could be more niche wines. But we don't really know what that entails just yet.”

Gallagher said he’s heard from other smaller liquor store owners who told him they’ll be putting some of their orders on hold as they wait and see what kind of selection grocery stores would have on their shelves.

As more customers move from liquor stores to their neighborhood supermarket for convenience, Gallagher said he’s relying on his regular customers that he’s built up over the years to keep coming back.

Will wine in grocery stores bankrupt Colorado’s smaller liquor stores? The data says likely not

It's been four years since a Prohibition-era law in Colorado which prevented full-strength beer from being sold at supermarkets was scrapped from the books and research shows the transition had minimal impact on liquor stores.

The study, which surveyed 76 Colorado craft breweries nearly a full year after then Gov. John Hickenlooper signed the measure into law, found that full-strength beer sales “did not appear to have harmed the regional competitiveness of the craft beer industry, but neither has it produced visible benefits.”

Using cell phone tracking data to analyze liquor store traffic, researchers found a 5% decrease in foot traffic in liquor stores, “which all things considered, wasn’t gigantic,” according to Marco Costanigro, a professor of agricultural and resource economics at CSU and one of the study’s co-authors.

The study didn’t track sales data because those figures were hard to come by, but they find that craft beer sales in liquor stores declined by the equivalent of 5.6 million bottles of beer while grocery store beer sales jumped by more than 9.2 million bottles.

Impact of wine in grocery stores: The story told by beer sales in 2019

Those challenges made it easier for those smaller breweries to partner with smaller liquor stores that had fewer logistical challenges to get through in terms of distribution, according to study co-author Joe Cannon, a professor of marketing at CSU.

“I think the sale of wine in grocery stores will further erode the share of liquor store sales that happen in liquor stores,” Cannon said. “However, we’ve seen some smaller liquor stores respond by stocking a greater variety of craft beer, which in turn helps those small brewers.”

But Cannon and Costanigro agreed – in order to survive this expansion, mom-and-pop liquor stores will need to specialize in offering more niche products to consumers if they hope to remain competitive.

RELATED: 'We don't plan to go anywhere': Colorado liquor stores prepare for wine to hit grocery store shelves

Kevin Webber, the CEO and Founder of Carboy Winery told Denver7 this week the expansion into grocery stores is great for business as it will allow local vineyards to partner with retailers to put wines from across the world, but especially from Colorado, into many more hands of Coloradans, which will have a positive net benefit in the economy.

One such retailer was Whole Foods, which took the initiative to partner with local vineyards in two of their stores – Highlands Ranch and Boulder – and has since expanded to all of their locations in the metro.

What about the health concerns of introducing wine at grocery stores?

Rise Above Colorado, drug abuse prevention organization, told Denver7 they’re worried about wine sales expanding to grocery stores by making alcohol easier to access because alcohol use is already up in Colorado.

In 2020, a survey of teenagers found one in four – 25% – lived with someone misusing substances. By 2022, that figured increased to 41%, according to Rise Above Colorado executive director Kent MacLennan.

“I think there is an important distinction of understanding how we, as adults, manage use responsibly, and show that and model that,” MacLennan said.

Their survey found teenagers are twice as likely to misuse substances if they see someone in their household doing so. Teens who are concerned about substance misuse in their homes can get more resources on the website,

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