Trader Joe’s to sell wine in New York–almost!

wine_hangsThe economy’s downturn has left many a gap in the New York State budget. Governor Paterson has proposed some new ways to plug those gaps, such as difficult spending cuts as well as new taxes on private jets, furs and soda. It looks likely that wine will not escape unchanged.

The governor proposes raising the state taxes on wine. Given that the state tax is currently $0.19 per gallon, below the national median of $0.69, we could have seen that one coming.

But he proposes a more far-reaching change: selling wine at grocery stores. Yes, Trader Joe’s, Whole Foods and others might soon be able to sell Sancerre right next to the Camembert without the need for special, at-grade entrances to separate facilities. This could really shake up New York wine retail by offering more convenience to consumers and increase wine sales overall; indeed, the governor estimates that it will bring in $150 million in revenues to the state.

Given that the number of licensees would jump from 2,400 to 19,000, the plan would presumably, remove the limit to one location per licensee. This would allow stores such as Zachys, which has only one location in suburban Scarsdale, to open stores in Manhattan or other successful Manhattan stores to open in other neighborhoods. Presumably, they would also be allowed to sell cheese and bread if they wanted to. Many details clearly need to be worked out and we’ll see how it unfolds between now and March.

In the meantime, have your say in the latest poll!

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29 Responses to “Trader Joe’s to sell wine in New York–almost!”

  1. This is a fantastic idea. I strongly believe in the concept of having wine in the same place I purchase my food. After all, that’s where I randomly decide what I’ll be eating and need to make a pairing. And, as you stated, it seems this would also allow more freedom to the independent retailers with only one location. With wine on every corner, let’s just make sure we enforce the crosswalks.

  2. I’m sort of indifferent to it. As a resident of NYC, I observe that we have a plethora of liquor stores/wine shops all over the place. Most of us are less dependent on supermarkets than people elsewhere, mainly because of the extremely tight, expensive space/rent considerations.

    It makes more of a difference to people who live in more spread out areas, especially where wine retailers may not be exactly thick on the ground.

    The real reason I’m so indifferent is that, with very few exceptions like Whole Foods or Wegman’s, the wine on offer will be the same industrial quaffers that’s already available everywhere from the low-end package stores to simple eateries. It might serve to push already low prices lower, but the wine still wouldn’t be anything you’d truly want to drink.

  3. Terry – per your observation, I just added a third reply option for you, the shrug of our day: “whateva.”

  4. I think it’s a great idea. This idea that alcoholic beverages should be treated any different then any other product is loony(excluding the age limit.. although I have my problems with the 21 for drinking 18 for going to war,voting,contracts etc.).
    People should be able to get wine,cheese, meat bread, meat whatever together on any day at any time!
    I’ve lived in N.C. for 25yrs now and have seen things even loosen up here(although there are still some reallllll bizarre hold overs from the old blue law days.
    I understand that after the repeal of prohibition you had business,govt,and religion trying to come up with something that would piss the least or most people off, depending on your point of view and with each state getting to make it’s own rules,things really got nuts!
    With each step away from the dry minded thinking we get the better for us!
    Now if N.C. would come a little further into the 21st century….

  5. I own a wine store in Manhattan, so I suppose I should be worried at what this could mean for my business. While it is a little concerning to think about the Whole Foods round the corner selling wine, it’s hard to object to something that makes such common sense. But as you mentioned, it opens up a whole can of worms. Will I be able to sell beer? Or cheese? Or bread? Will I be able to franchise my business or open up multiple locations? I don’t get the sense that these issues have quite been thought out, so I’m guessing it will be an interesting ride over the next few months as we see this come to a head. What I don’t believe is that this will benefit the NY wineries. In my former corporate life, I’ve been involved with enough big chains to know they’re probably not going to want to deal with the small winery that drops off the wine in a pick-up truck two or three weeks after you order it.

    In any case, it will be interesting!


  6. I have been sitting at my computer trying to digest all the various possibilities this proposal presents. My mind is spinning. As a wine importer this could be great, however, as an importer that has thrived on smaller retail stores I see many ways this could put many of these small retailers further in a hole. I am very anxious to see what actually ends up passing. I just hope that this wasn’t done so hastily that Gov. Patterson doesn’t realize the can of worms (both positive and negative) he has opened. I wish I could change my vote, I originally voted yes, to dangerously confused.

  7. I’m with Christy on this one. My immediate reaction was to worry about what it would do to the small wine shops. Will they be able to compete with the prices considering that TJs and others can buy at a better price point because of volume? Like anything else, it has both positive and negative aspects, but I worry for the small guys.

  8. But wouldn’t Trader Joes’s have greater concern in this scenario — supermarkets and the Koreans selling wine — than someone like Christy?

  9. Let the supermarkets sell only New York State wine(I would say a certain pecentage of NYS wine, but it couldn’t be enforced). This way the Mom & Pop stores and the stores in shopping plazas with supermarkets can still operate. Store owners can make a living and keep their employees, landlords can keep their tenants, NYS wineries would get a boost and NYS would get their license fees. Nobody gets hurt.

  10. Yes, clearly there are a lot of issues that need to discussed. The proposal at this point is just that: a proposal. So hopefully there can be a good discussion before legislation is enacted. I, for one, will be keeping an eye on it. Please send in your thoughts with developments as the issue progresses in the coming months.

    On a somewhat hopeful note for Christy and other independents, there are many states that have grocery stores sales as well as thriving independent wine shops. To a certain extent, grocery stores and independents focus on different wines and customers so even though the product is fermented grape juice in both places, the quality, service and experience can be quite different.

    Costco probably represents the biggest threat/opportunity, depending on your point of view. But their inventory can be more of a “treasure hunt” than something you can rely on.

  11. Way past time for a change when you can’t purchase Gin and Tonic in the same store! And forget about wanting a lime!

  12. This is certainly an interesting proposition, and one that is both exciting and scary at the same time . . .

    For one moment, though, let’s consider we’re talking about almost ANY other industry . . . Toys? Books? Most Food Items? Computers?

    MOST industries have been faced with the onslaught of products being available at ‘superstores’ for years . . . This certainly has made life more interesting for ‘speciality retailers’ and this stands a chance of doing the same for wine stores as well.

    I’m sure folks like Cristy will survive – what kind of customer service would you expect to find at a supermarket when it comes to wine? Who’s there to ask which wine goes with which food, if a wine is currently ‘drinking nicely’, etc?

    Supermarkets will certainly have an adverse effect on certain classes / categories of wine. And therefore retailers may have to be more careful what they bring in.

    Curious to hear what others outside of our industry have to say . . .


  13. Coming from a state where you can buy beer at the gas station and hard liquor at the grocery store, the blue laws in Northeastern states make no practical sense whatsoever and only exist to give the impression of modesty or to have some other ridiculous overtly religious connotation. If it’s good wines you want, you will find them at the non-chains. People who buy Yellow Tail at the local wine shop will still buy the same garbage at Key Food. So what? The possibility of a place like Smith & Vine being able to have multiple locations is pretty great and enough reason for me to support the idea.

  14. I agree with Sal above…if this means a wine store can open up multiple locations, that’s potentially very exciting. As long as the licensing fees don’t skyrocket, New York could be a very friendly place for mini boutique wine chains (think Scoop for wines). Unlike, say NJ, where a license easily goes for 6 digits, small wine retailers that are on their game can actually see this as an opportunity.

  15. Trader Joe’s is cool because you can find a bunch of private label jazz for really cheap that sometimes tastes pretty good. Plus their food just rocks too!

  16. It really depends upon the quality of the wines they stock – most people who like fine wine will already have somewhere they go to for that. So, in all probability, this will be yet another outlet for mass-market wines…

  17. Sal, I’ll take you one further. The state I call home could often be considered a bit backwards. It’s sad to say that we narrowly went red, still, despite everything that the past few years have brought. But at least you can buy beer, wine, and liquor at a gas station, supermarket, or a dedicated store. Not only that but many wine shops sell cheese, and sometimes bread, and often an entire array of gourmet foodstuffs, though they usually focus on the wine or the food with the other as more of a sideline.
    The result? Wine stores are all over the place. They seem to do as well as any other small shops in their respective areas.
    Dr. Vino, you say that a lot of things would have to be worked out, but I don’t think that you believe that. I think that blue laws and shipping restrictions are archaic and anti-competitive, and frankly un-American. And Yes, I know that puritanical and self-damaging laws are as American as apple pie and witch-burning, but I am talking about the commercial America, founded on the idea that businesses should be allowed to compete and that the consumer should be allowed to choose.
    As a final note. I still shop at a variety of wine retail. For holiday quantity wine I go with the least expensive super market where I can get my value brand of choice, Columbia Crest, for several dollars less per bottle then at any other outlet. But their choice is limited, so for the next tier wines I hit the higher-end supermarkets, still have good prices but selection is better. Finally, for specialty I hit the dedicated wine shops, and of course, in this little corner of wine paradise, I also have the option of the internet, complete with legal shipping, even from other states. I know that the vast majority of wine drinkers won’t go to these lengths, and probably don’t have the time or desire to do so. But for me, as an enthusiast, I am so glad to have the options, to have the Freedom, to do so. I think everyone should, because I cannot agree with a single argument against such freedom.

  18. […] in supermarkets Jump to Comments Dr. Vino has already brought this up on his blog: Gov. David Paterson has included in his budget, which will then have to be approved […]

  19. We have a Trader Joe’s and also smaller wine shops and it seems that it does not hinder the performance or sales of the smaller shops. I think this is due to the fact that Trader Joe’s has a few things that do not hinder the wine shops – a) Their line of wines are low to mid range (most wines are about $10-15 b) they do not have a big stock of wines – we only have two isles. They do carry a few wines that are their own lables that are pretty good. One wine is about $6 and is a great everyday wine. But it is very handy to buy wine when you are in a pinch or grocery shopping.

  20. Hmm, I’m out west in Tucson Az having a nice glass of wine on my patio at sunset that I just bought at TJ’s. I thought NY was the most progressive city in the US, but I guess politics trumps common sense sometimes. No wine in grocery stores? How archaic? Good luck changing the law.

  21. […] aisle–yes, aisle, and not separate store as with their location 14th street in Manhattan (but that may change soon). The wine selection was more varied, with lots of Italian wines, and the prices seemed lower. But […]

  22. In the beginning when I heard about selling wine in the grocery stores and Trader Joe’s, I thought it’s a great idea. But, if you think carefully it is not a good idea because majority of the Americans dont have knowledge enough what to buy and drink. The grogery stores will not be able to guide the customers with what to buy and drink. The wine will be sitting on the shelf and one have to be very knowledgeable to buy the wine at the grocery store. Most of the time when I go for wine shopping, I spend time wine finding out which wine taste better with what food as there is knowledgeable staff.

  23. […] why he has proposed to allow food stores to sell wine, a subject we discussed the day the idea was floated. To recap the budgetary logic, he proposed to more than double the excise tax on wine and increase […]

  24. […] outlined on December 16, to allow the sale of wine in grocery stores throughout New York State. Dr.Vino wrote a long post about this n December and many local publications have been following the story. I […]

  25. As a NYS wine retailer I am NOT in favor of this legislation. The proposed bill would allow the sale of wine not only in grocery stores but in any business that sells “grocery products”. CVS drug stores, 7 eleven type of shops…it would dilute the market.

    This could also result in the loss of nearly 6000 jobs as close to 1000 shops would be forced to close as a result of losing 60-70% of their business.

    This issue goes beyond New York City. Family owned businesses all across the state will have to close their doors. Walmart, Costco, Trader Joe’s will be contributing directly to loss of thousands of jobs while creating no new positions.

  26. […] of New York wine retail law that would expand wine sales to supermarkets. (See backgrounders here and […]

  27. Being that my parents, own a wine and liquor store, I am NOT in favor of this legislation. Allowing supermarkets to sell liquor would result in many small retailers and mom-and-pop stores to shut their doors, leaving those business owners out of job. Whereas regardless if the new legislation is passed, supermarkets will be able to stand on their two feet.

    My parents have been in this business for over 20 years, and it is all they own and know. It is really distrubing to be that something that they have built from scratch with great passion will be gone. Please vote against supermarkets selling liquor.

  28. Are FJs in NY now allowed to sell wines and if so wehre in Westchester,,,I know CT does not allow this, unfortubnatekly. Had xome cabernet sauvignon at a friend’s home in VA and it was good and very reasonably priced. Would lioke to buy some but so far no luck. Can I buy it onkline like Costco?

  29. Just stumbled here, read the post and I wanted to know what happened to the proposal? I never been to new york but I love wine and I’ll visit new york this year.


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