Supporters of selling wine in Oklahoma grocery stores are jumping ahead of a process put in place by state Sen. Clark Jolley in Senate Bill 658. That bill created a task force study group composed of the industry, ABLE Commission, consumers, Oklahoma winemakers, grocery and convenience stores, and Oklahoma mental health officials.
The group was tasked to review the beverage alcohol industry and decide what needs to change and then report to the governor by Feb. 1, 2012.
Supporters of wine in grocery stores (WIGS) have demonstrated that they have no confidence in the task force by going public and claiming that Costco won't come to Oklahoma without WIGS. Costco has the Greater Oklahoma City Chamber to do its bidding; it costs Costco nothing to make claims about coming to Oklahoma.
What the chamber and Costco aren't saying is what Costco's real criteria are before moving into a new market. The average Costco customer is 51.6 years old and has a high income. When the density of the population of this type of consumer hits a certain level, Costco enters that market — as it did in other states, regardless of whether the states allow the sale of wine in grocery stores.
Just to name a few non-WIGS states where Costco has stores: Kansas (two stores), Minnesota (six), Utah (nine), Colorado (12), Tennessee (four), Kentucky (one), New York (15), Connecticut (five) and Massachusetts (six). Oklahoma does have several market areas that meet the Costco criteria, as other upscale grocers such as Sunflower and Whole Foods have discovered. These stores can't sell wine!
Oklahoma's beverage alcohol industry was created in 1959 and is guided by Article 28 of the state constitution. Any change in those guidelines requires a vote of the people. The WIGS proposal covers at least three and possibly four sections of Article 28. Each of those changes would require a separate state question.
Supporters say WIGS would bring prices down and selection up. Currently the distribution system delivers spirit goods to 2,310 licensees at a 9 percent to 10 percent markup and wine goods at 15 percent. If WIGS passed, the number of licensees would increase threefold because not only grocers would be eligible but also convenience stores and drugstores.
The distribution system would be unable to service the market, so consumers would pick up the tab through increased markups. Currently Oklahoma offers 17,000 to 20,000 items. Texas, a WIGS state, offers only 12,000 to 14,000 and Oklahoma is a much smaller state.
It appears Oklahoma's system does have some distinct advantages. From a consumer's point of view, however, we do have a few hard edges. Those consumer complaints will be addressed in upcoming meetings and for the most part can be resolved with changes in state law.
Jolley and the committee should be given a chance to complete their work and give the governor a consensus report.