Mail-Order Alcohol: why you can’t get that niche bourbon (and why you might be able to soon)

Mail-order alcohol is having a hell of a moment right now. Lots of us are stuck at home, avoiding the bar and the liquor store, spending hours online looking for ways to entertain ourselves. I put in an order through a local booze delivery app a few weeks ago, and since then my corner of the internet has been inundated with ads for companies like Drizly, Caskers and Wine.com. I could clear my cookies but hey, the ads are going to be there anyway; they might as well be on point.


Mail-order alcohol first appeared on the scene in the 1970s, with the founding of the Wine of the Month Club. This was the vanguard of the connoisseurship era, when Julia Child, Alice Waters and their ilk were introducing Americans to the European traditions of fine food and fine drink, and the Judgement of Paris lifted California wine to previously unthinkable heights. People wanted to expand their palates or try a specific wine that might not be available in their neighborhood liquor store, and businesses were eager to help.

The problem was, many states had strict laws against exactly this. Governments thought it sounded like an easy way for minors to get their hands on alcohol, and for businesses to skirt taxes. As demand grew, many of them started to allow deliveries from in-state wineries, but still prohibited it from everywhere else. It was easier to keep an eye on the in-state sellers, and it had the added bonus of giving homegrown business a leg up on the competition. (I wrote about the wide-ranging attempts to boost in-state wine industries last year). Problem is, that’s legally questionable at best. The Constitution’s Dormant Commerce Clause says that states can’t pass laws that favor their own businesses at the expense of interstate commerce, and in a 5-4 decision in 2005, the Supreme Court said that these wine shipping laws did exactly that. In Michigan, New York, Pennsylvania and Massachusetts, laws were struck down, and at this point your in-state and out-of-state wineries are on a more even footing.

That’s just wine, though. While all but four states (Alabama, Utah, Mississippi, and Oklahoma) allow some kind of direct booze shipping, only eight allow beer and only five allow spirits (and even then it’s only under specific circumstances). The Supreme Court decision was quite narrow (as, on purpose, they often are), and while it would stand to reason that laws that favor in-state producers of spirits or beer (or anything else, for that matter) would fall under the same principle, the ruling didn’t say that. So today, I can order a nice bottle of Rye Malt Whiskey direct from Coppersea Distilling just across the Hudson from me, but I can’t get any of my favorites from when I lived in Texas. One set of rules in-state, another set out-of-state, at least until we get a broader court case that changes that.

And yet, the market adapts. Rules in most states are very different when it comes to shipping from a retail outlet, as opposed to the actual producer, so myriad online middlemen have popped up to partner with in-state stores in getting alcohol from their shelves to your door. Some offer same-day delivery from your local store, delivered just in time to keep the jungle juice flowing at your house party. Others offer a big selection of hard-to-find wines that will arrive in the mail (gift wrapped and engraved, if you like) from some store a few hours away. Regardless, that package came from a liquor store in your state.

This corner of the liquor law world seems to be liberalizing. Barriers to out-of-state wine shipping have fallen, and at some point a new court case will probably do the same for liquor and beer. The COVID-19 pandemic might also accelerate the change in some places, as booze delivery companies gain new customers and a broader acceptance. What will that mean for retailers and distributors? Will it actually break the three-tier system, or will states find a way to write that into the law? Get ready for the Amazoning of alcohol.


Sources:

Kte’pi, Bill. “Mail Order Alcohol.” The Sage Encyclopedia of Alcohol: Social, Cultural, and Historical Perspectives. Scott C. Martin, ed. Sage, Thousand Oaks, CA: 2015

National Conference of State Legislatures. “Direct Shipment of Alcohol State Statutes.” Accessed 4/14/20. https://www.ncsl.org/research/financial-services-and-commerce/direct-shipment-of-alcohol-state-statutes.aspx

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