I-1100 vs. I-1105: The clear winner emerges
OK, so this blog has been overcome with liquor privatization updates… which is A-OK, considering the importance of ensuring the success of Initiative 1100.
Perhaps you’re unsure of the difference between the two liquor privatization initiatives on the ballot–1100 and 1105. Truthfully, these two initiatives couldn’t be more different, and it’s critical that you understand how.
Our director of government affairs, Bruce Becket, put together this great overview of why the hospitality industry is supporting I-1100 and NOT I-1105. It’s in your best interest to do the same. If you want more information visit Yes to 1100.
Here’s Bruce’s take:
Why Does the Restaurant Industry Support Initiative 1100 over Initiative 1105
Initiative 1100 is good for restaurants and consumers because:
1. It creates competition between manufacturers, distributors and retailers of spirits, beer
and wine.
2. Restaurant customers will receive better value and more product offerings.
3. Important enforcement, education and prevention of underage drinking functions will
be maintained.
Under I-1100, restaurants will have the option to acquire spirits, beer and wine from:
• Retailers such as grocery stores, “big box” outlets, or specialty stores.
• Distributors – including current distributors or new entrants in the market.
• Manufacturers.
Additionally, restaurants can work with their vendors on (1) payment terms (2) quantity
discounts (however, no sales price can be below the cost of acquisition), (3) delivery
options and (4) more flexible marketing and promotional tools.
Restaurants can also inventory supply for their business at an “off-site” location.
Finally, Initiative 1100 will provide resources to protect enforcement, education and prevention of underage drinking programs.
• It leaves the Liquor Control Board with all its powers to enforce liquor laws,
education, and prevention of underage drinking.
• It maintains current taxes on spirits, beer, and wine to fund state and local
government services
o It does, however, eliminate the state’s current 51% markup for spirits.
In contrast, Initiative 1105, does not lead to open competition for spirits, beer and wine, it
preserves existing restrictions in the market for beer and wine, and will have a large
impact on resources available to state and local governments.
Under I-1105, a restaurant can only purchase spirits, beer and wine from licensed
distributors.
- Restaurants would not be able to purchase from other retailers
- Restaurants would not be able to purchase from manufacturers.
- Restaurants would not be able to negotiate quantity discounts for beer and wine.
- Restaurants would not be able to inventory product off premise for their own use.
Additionally, I-1105 repeals the state markup AND ALL liquor taxes, reducing state
revenues by $520 million over 5 years.
8 Comments to “I-1100 vs. I-1105: The clear winner emerges”
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john roberstson - September 13th, 2010 at 8:09 pm
i have no dog in the fight…but i cant see the good of this bill….more liquor stores….cant be good…the major problem mom and pops shop will not get the same price on bud and coors…not fair to them…to many negatives on this bill
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It is time for the state to get out of the liquor business. When prohibition ended 77 years ago, the states were given the right to determine how to regulate liquor. That was back in 1933! That was 13 years after the U.S. allowed women to vote! It is time to put the old thinking behind us. Why shouldn’t we be able to purchase spirits in the same establishments where we purchase wine and beer? If it is about alcohol content, I can purchase 10 bottles of cheap wine for the price of a bottle of vodka and get even more intoxicated. We should be able to determine our own moralities, and not have the state government decide what is best for us. To continue, if we get the regulation out of the liquor business, we definitely will see not only more of a variety of spirit brands, but also more variety of wines. The small “boutique” wineries cannot compete for volume sales to distributors. Think about it before you vote and most of all, get informed so you can make the right decision(s). Let the market decide what is on the shelves, not the distributors and the state.
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Henry - September 29th, 2010 at 1:48 pm
response to John Robertson…
wouldn’t it still be less expensive for the mom and pop’s as you put it to buy their spirits from a big box store, which will have a markup of 10 % instead of the 51.9 % from the state? The lower cost alone would generate more business, wouldn’t it? Isn’t that how it works now? the mom and pop’s shop at the big box stores now. In fact, that was the business model of Costco before they opened it up to the general public. It was suppose to be a place where businesses could go to get the leveraging power of the big box store, so that they could make more money in their smaller shops. You use to have to be a business owner or a member of a business/association/credit uinion in order to join Costco. Did I imagine this? I think that we are all forgetting why Costco sells toilet paper in the huge packages or to that fact why everything is bigger at Costco. It is so that businesses can break apart the packages and sell them as individual uinits. I would have to disagree with your assessment…I don’t think that there are any negatives in passing initiative 1100. Yes to I1100! -
Greg - October 5th, 2010 at 4:08 pm
I’ll definitely be voting for 1100, but I’m still puzzling over the pros and cons of 1105. Some background: I moved here from Georgia, in which liquor was distributed much as mandated by 1105: and the legislative kickbacks from distributors and the resulting corruption were not exactly in the best public interest.
So: should we vote for both 1100 and 1105 in the hopes of wresting control from the state via any means available, or should we vote only for 1100, thinking that we try only for the best solution, and then try again later if it fails?
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Weekend Special: Liquor Initiatives 1100 & 1105 « The Candle Wine Project - October 17th, 2010 at 5:08 am
[...] “I-1100 vs. I-11005: The clear winner emerges.” Washington Restaurant Association Blog, September 19, 2010. [...]
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John Scanlon - October 17th, 2010 at 12:00 pm
If we vote for privatization, let’s do it right and pull our sales and purchasing power back into our own hands. If we vote for 1100 AND 1105, we will end up with a huge bureaucratic mess to amend. If 1100 fails, we’ll try again next year.
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Greg R - October 19th, 2010 at 11:27 pm
Response to john roberstson –
Mom and pop stores will have the option to sell liquor at whatever price they can negotiate. As it is now they don’t have that option at all. Mom and pop stores don’t get toilet paper or cereal at the same price as box stores. Why should Bud, Coors, Jack Daniels, or Absolute be different?
Here are some positives for 1100 passing
- ALL retailers currently selling beer and wine will have the option to get in the liquor biz. Another opportunity for them (including Mom & Pop stores) to make money
- thousands of jobs will hit the market to help with sales in all of the private retailers that decide to get in the Booze Biz
- Consumers have a choice on price and selection
- retailers can go direct (if they choose) to the manufacturers. 1105 would take the monopoly out of the states hands and put it in the hands of the current “liquor” distributor.
- Current “beer and wine” distributors will have the opportunity to get into liquor distribution. Possibly growing their biz
- Since 1100 won’t change the liquor tax the state will NOT lose money because sales will increase.
- Hundreds of thousands if not millions of Washingtonians dollars spent on liquor in other states (& brought back to WA) because our prices are too high will start coming back to this beautiful state
- Above all, for the safety of you, me and our families, 1100 will give us more enforcement to keep minors from buying booze.I am sure that there are hundreds of advantages that will pop up in time.
YES on 1100 and NO on 1105 -
Weekend Special: My Views on Liquor Initiatives 1100 & 1105 « The Candle Wine Project - October 24th, 2010 at 5:13 am
[...] on that. I believe more in a free market trade, where a local winery can go to a local store or local restaurant and have them sell their product without a distributor. It allows things to be done locally and [...]
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