Local Mom-and-Pop Alcohol Outlets Face Tough Road Ahead
Trevor Phipps
When voters gave the green light to allow grocery stores and gas stations to sell beer that was short of the full-3.2 percent level in 2019, many small business owners feared that the move would be detrimental to small mom-and-pop liquor stores.
These business predictions were right on target, and the devasting impacts for independently-run stores, which pride themselves in offering more personal service and diverse products, could continue.
After five years, many of these small businesses have suffered bigtime. But now their concern has shifted to future ballot measures that could make things much worse for them, and even force some popular local stores to shut their doors.
A little more than a year ago, the state allowed big box stores to sell wine along, with full-fledged beer. This followed the passage of Proposition 125 by a narrow margin during the 2022 election. Business insiders say that the ballot measure has caused the revenues of independent liquor stores across the state to drop by approximately 30 percent.
Industry proponents agree that independently-owned liquor stores have already taken a hit due to the two ballot measures over the last two years. However, this could become the beginning of a continual trend due to more laws that are favorable to big box outlets. According to Dean Toth who owns Banana Belt Liquors store in Woodland Park, a proposal is moving forward that would put a measure on the ballot as early as 2026, allowing grocery stores and gas stations to sell hard liquor in addition to wine and beer.
Toth said that Prop. 125 did not hit his store in Woodland Park as hard as other places in the state, but his wine sales have experienced a 6 percent decrease. Shoppers now have been able to buy wine in grocery stores, such as Safeway, City Market and Walmart. These same concerns have been echoed by other local liquor store operators. Toth, whose business has been voted as the best liquor store in the region for a number of years, fears that allowing corporate chains to sell alcohol could not only harm small businesses in the area, but it could create other issues.
“Just in the city limits of Woodland Park, there will be 14 different stores that can sell beer, liquor and wine,” Toth explained. “Could you imagine trying to police and control all of that?”
He said that over-saturating the local market with alcohol would lead to some of the small, independently-owned businesses to be forced to shut down. He also mentioned that small craft distilleries, such as Black Bear Distillery in Green Mountain Falls, would suffer because some of those smaller producers only sell their products in local liquor stores.
The Banana Belt Liquors owner recently brought the issue up to city officials. He asked the Woodland Park City Council to limit how many liquor store licenses the city issues to a total of three. Currently, the city does not impose any limits on how many liquor licenses they allow.
“When speaking with city officials, our thought processes led to ‘we could have 20 Mexican food restaurants in town,’ but our demographics would not support it,” Toth said. “Soon we would be back to two or three Mexican food restaurants in town.”
A Region and State-wide Concern
And local liquor store owners are not the only ones who are worried about this over-saturation situation. Many business owners from across the state have taken an arguably bigger hit since Prop 125 went into effect just over a year ago. According to Jack Backman, the owner of Cheers Liquor Mart in Colorado Springs, the giant liquor store’s overall sales have dropped 15 percent over the last year, and their wine sales have decreased by as much as 40 percent.
Backman said that more than 50 liquor stores across the state have shuttered in the past year, including the 5,000 square foot Crown Liquors on the north side of Colorado Springs and a 20,000 square-foot store that has been operating in Denver for more than 25 years. “The prediction is that 25-50 percent of the liquor stores will be gone in the next three years,” Backman said in an email newsletter sent out to his customers.
But liquor stores aren’t the only businesses that have suffered, a trend that many say will get worse if hard liquor sales are opened up to big box outlets. According to an article published by Colorado Public Radio, businesses in other industries, such as alcohol production and distribution, have also taken a financial hit since the laws have changed.
Unique wineries, such as Sauvage Spectrum in Palisade, and breweries like the Diebolt Brewing Company in Denver, told CPR that a large part of their business comes from small, independently owned liquor stores. If small mom-and-pop liquor stores go away, then many fear that small craft breweries, wineries and distilleries could also go out of business due to the fact that grocery stores might not choose to carry their products.
State Lawmakers Seek to Curb the Liquor Store Carnage
Recently state legislators introduced House Bill 24-1373, called “Alcohol Beverage Retail Licensees,” that would keep hard alcohol sales available to just small liquor stores. The bill was introduced mid-March with both Republican and Democrat sponsors, but it has already seen opposition from groups, such as the Colorado Retail Council.
The law would prevent large corporations from getting liquor licenses and it would allow restaurants to purchase more alcohol from small liquor stores. If passed, the bill would also require that grocery stores only sell beer and wine in one section of the store.
Sponsors of the bill say that alcohol is currently too easily accessible and that the recently passed laws have taken a toll on the state’s small businesses. But opponents say that the measure goes against the wishes of the voters, and it would make alcohol enforcement harder.
The bill that currently has bipartisan support will be debated on the House floor this month starting with Business Affairs and Labor Committee.
