Your favorite liquor store in northeast Jackson, Madison or Ridgeland is most likely taking a wait and see attitude before offering the delivery of alcoholic beverages.
“I don’t know anyone who has jumped into that game,” said Matt Basden, director of McDade’s Wine & Spirits in Jackson.
Liability risks and the expense of providing the service concern some liquor store managers and owners. They also wonder if customers want the option of delivery when it seems like there’s a liquor store on every block and question if customers are willing to pay for the service.
“I think it’s a bad idea,” Basden said. “It’s too much exposure for the business.”
A new law went into effect on July 1 that allows for the delivery of alcoholic beverages, beer, light wine and light spirit products, provided a retailer obtains the necessary permits and pays for a $500 privilege license.
The law also allows a third-party delivery service that obtains the necessary permit to contract with a retailer that sells alcoholic beverages.
So far, just seven businesses in the state have applied for alcohol delivery permits from the Alcoholic Beverage Control division of the Mississippi Department of Revenue and two permits have been issued, according to the Mississippi Department of Revenue.
Saw Inc. in Starkville and Fetcht LLC in Batesville have received permits and Zip Bottles in Jackson, Booze Cruise in Bay St. Louis, MMB Investments in Oxford, Third Base Liquor in Tishomingo and Tupelo to Go in Tupelo have applied for permits.
Ensuring liquor isn’t delivered to anyone under age 21 and anyone intoxicated is a major issue, said Nick Lord, general manager of the Wine & Spirits in the Quarter in Jackson. A store could have its license jerked for either offense.
“Our permit that we have to qualify for each year demands that we check IDs for people who are buying alcohol,” he said. “That liability is on us. We can have our permit taken away if we sell to someone not of age or intoxicated, either or.”
“Those are things my staff are taught from day one. That is the most important thing we do here. We make sure we’re putting alcohol in the hands of people eligible for it and no one else.”
Too many unknowns exist with the delivery of alcohol, Lord said, and that’s why Wine & Spirits in the Quarter has no plans to offer it. A delivery employee could have an accident, encounter problems in an unsafe area of town or face an unexpected situation, he said.
“You don’t know the conditions of the customers when they call in an order,” he said. “There may be a house full of teenagers and one adult who calls in an order.”
In Mississippi, a license holder for a liquor store can only have one store, which makes it doubtful local employees will make deliveries, said Conner Reeves, an attorney with McLaughlin, PC.
“If you had five or six stores and could share employees to do delivery, it would make sense,” he said.
Just as numerous restaurants rely on services such as DoorDash, Grubhub and Uber Eats, liquor stores will most likely follow their lead and partner with a delivery service, Reeves said.
“A good example is Drizly, which just got bought by Uber for $1.1 billion,” he said. “Clearly there’s a market for it.”
Reeves said one of his clients, Raj Ramarao of Madison, plans to enter the delivery business. “He’s a tech guy and going to start his own alcohol delivery service,” he said.
Young consumers who like to have options for doing business, including placing orders on their cell phones, are expected to embrace alcohol delivery, Reeves said.
Using a delivery service, anyone searching for a particular wine or spirits could use their phone or web browser to find it using an inventory online, place an order and have it delivered, saving time and a trip or two to a liquor store, he said.
“It’s useful for someone looking for a particular product,” Reeves said. “It’s not for someone who likes to walk into a store, browse and see the sales.”
The law allows a retail permit holder such as a liquor store, grocery store, bar, brewery or brewpub and a delivery company that contracts with a permit holder to obtain a permit for alcohol delivery.
A liquor store would qualify to deliver liquor and wine but a grocery store could only deliver beer and light wine.
Lord is wary of putting liquor in the hands of a third party to deliver because the store’s liability doesn’t end at its front door as it does now.
“I’m not going to put my permit to operate my store in jeopardy by allowing someone I do not employ to take alcohol from me and deliver it,” he said. “That’s not an option for us.”
Delivering liquor isn’t the same as Amazon delivering a pair of shoes or Walmart delivering bananas, Lord said. Liquor stores sell a controlled substance and employees must ensure buyers are eligible for it, he said.
For a local store to offer delivery on its own would be expensive, Lord said.
“In order for us to deliver, we have to purchase a delivery vehicle, carry $1 million in liability insurance on the vehicle and employ someone to do the delivery,” he said. “A small family-owned liquor store is not going to make enough money back.”
Scott Jackson, owner of Colony Wine Market, said he has read the law about delivery but considers it cumbersome.
“There should be two regulations: that you can’t deliver before 10 a.m. and after 10 p.m. because that’s the hours we’re open and you must check ID,” he said. “Those should be the only regulations.”
Jackson has spoken to third party companies about the delivery of alcohol and said they are studying the demand for it. “They have an eye on it, but they haven’t set it up,” he said.
Delivery services that deal with alcoholic beverages are used to dealing with state laws, Reeves said, and liability risks would shift to them.
“Though not explicitly addressed in this new bill, Mississippi’s dram shop laws that protect licensed retailers from liability in certain circumstances may extend to alcohol delivery, so long as the deliverer does not provide product to a visibly intoxicated person,” Reeves wrote in a blog on the McLaughlin, PC website.
“To reduce potential liability, ADP holders should ensure that their delivery staff receive TIPS training (Training for Intervention Procedures) and follow other company policies.”
The law allows for orders to be placed by phone, the internet or other electronic means such as through an app. The original retail permit holder must maintain control over the receipt of payment and remittance of all applicable taxes to the state.
Deliveries can only be made to individuals within wet counties in Mississippi and within 30 miles of the retail location and delivered products cannot be resold by the recipient. An alcohol delivery permit holder must also be able to verify a delivery recipient’s age using ID scanning software before product changes hands and must keep records of the transaction for 90 days.
So far, consumers have shown little demand for delivery but that could change, said Jackson, director of research for the Mississippi Independent Package Store Association.
“What I see happening is when someone has people over to watch football and run out of vodka, they could want delivery,” he said. “Most stores will have a minimum amount for delivery, so it’s not going to be worth your while to order one bottle.”
Jackson wonders how much consumers will be willing to pay for the service, given that liquor stores are numerous in the metro area. Mississippi has 690 package stores plus 15 private companies that represent, market and sell products to the stores.
“It’s not going to be worth your while to order just one bottle,” he said.
Upgrades to the state’s warehouse and distribution system, run by the ABC division of the Department of Revenue, are still needed in order to keep up with demand and new products and that’s where Jackson wishes the Legislature had placed its focus.
Reeves doesn’t expect consumers to embrace the delivery option quickly.
“Food delivery took restaurants putting up signs in their restaurants and then you had customers remember it was an option,” he said. “It just doesn’t just happen overnight.”