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Sunday, 09 April 2017 20:00

With alcohol delivery legalized, some retailers take advantage; others remain wary

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With alcohol delivery legalized, some retailers take advantage; others remain wary COURTESY PHOTO

COMSTOCK PARK — Maninderpal Singh said he’s been fighting for the better part of a decade to make alcohol home-delivery legal.

Now the owner of Cap & Cork LLC in Comstock Park is ready to take advantage of Public Act 520 of 2016, which went into effect March 29 and outlines guidelines for retailers to deliver alcohol.

“We’ve been wanting to do this forever because it gives us more access to our customers,” Singh said. “In the middle of a party, when you don’t want to leave, it just makes it a lot more accessible.”

The benefit to retailers aside, Singh attributes the state’s support primarily to a desire to reduce alcohol-related driving offenses.

“On a Friday night, the story’s pretty obvious: It’s safer for us to come to you than for you to come to us,” he said.

The act has multiple provisions to increase the safety of that transaction, as well. First, the retailer must pay a licensing fee, which is $1,000 per year. Then, the store’s vehicle needs to be registered, the employees performing the delivery must be Training for Intervention Procedures (TIPS) certified, and payment can only be accepted in-person after the employee has verified that the customer is older than 21, among other stipulations.

With delivery kicking off last Friday, Singh is more than willing to meet these requirements, while also putting some of his own guidelines in place. The store isn’t starting off with a minimum requirement for delivery, but a small fee will be charged and delivery will be available only during the evening.

Singh said he expects other stores to begin delivering as well, “but not everyone’s going to last.”

“Because when next year’s licensing payment comes around, I don’t think everyone’s going to think it’s worth it,” he said.

For his store, however, Singh is optimistic. He believes Cap & Cork’s broad selection and his rapport with customers will play a large part in his success.

“We’re bringing pretty much any beverage you can buy inside the state of Michigan to you,” he said. “Say you want Perrin No Rules and I have extra, I’m going to deliver it for you. You want some type of crazy Scotch you see on Facebook, give me a call. I think people are going to be calling me, asking, ‘Hey Manu, make me a six-pack of something I’m going to like.’”

Most of all, Singh sees this as an opportunity to get a leg up on the big-box retailers like Meijer Inc. that have been improving their craft beverage selection.

“We’ve been getting beat up so long from big box stores, where everyone just goes and gets their shopping done at once,” he said. “We’ve been taking a gradual decrease in business over the years ever since Meijer has been increasing [their selection]. … For once, we have an advantage over them.”

Meijer recently partnered with the Birmingham, Ala.-based Shipt Inc. to offer home delivery for groceries. Shipt currently doesn’t deliver alcohol or tobacco products, but a representative for the company said alcohol delivery “is an exciting potential opportunity that we are investigating for our members.”

With that door being open for larger retailers, Rishi Makkar of Rishi’s International Beverage is less optimistic. Makkar said the new law may benefit certain stores, especially those in highly-concentrated areas of population like downtown Grand Rapids, but it also opens the door for larger retailers to deliver. And with all of the infrastructure required to make delivery viable, he believes the larger stores may win in the end.

Based on 28th Street in Grand Rapids, Rishi’s is farther from dense residential areas than many beverage stores, which makes delivery more expensive. Makkar also is very concerned about his employees’ safety.

“You don’t know what state of mind you’re going to find someone in. There’s a nasty side of this business that’s often not exposed,” he said. “I’ve heard horror stories from pizza delivery drivers. Now you’re delivering to an intoxicated household?”

For his part, Singh shares those concerns, but plans to adapt his service accordingly and take whatever precautions are necessary.

Makkar said Rishi’s may end up needing to adapt as well if demand for delivery grows enough, especially if larger retailers enter the arena.

While Meijer doesn’t yet offer the service, Makkar said larger stores and online retailers were the driving forces behind the new law, which is not a good sign for the future of independent stores. In general, he feels that the drive to support local business in Michigan was for a time so successful that it has turned into complacency. Now many new legal regulations benefit larger retailers.

“Meijer’s competing with Wal-mart and Costco and Sam’s Club, but all of them are competing with Amazon. Somewhere in the middle, little guys like us are getting trampled on,” he said. “It’s kind of like the battle of the titans, and we’re the mosquitoes under their feet. Every once in awhile, one of us gets stepped on, whether it’s on purpose or just a casualty of war.”

Additionally, new online services have jumped into on-demand alcohol delivery in recent years. Among them is Boston-based tech startup Drizly, which has raised $32.8 million in venture capital since it was formed in 2012. The company currently serves 25 markets in the U.S. and Canada, but has yet to enter Michigan.

If fierce competition does end up forcing independent stores to close, Makkar fears what impact that will have on the communities they serve and for consumers’ choice, as larger retailers likely will never have the same variety and niche products that independent stores offer. As such, he has a plea for those who love craft beverages.

“Please continue to support your locals,” Makkar said. “Whenever you’re able to, please support those guys, because they need it more than a billion-dollar corporation does. And if that narrative gets forgotten, then our days are numbered.”

Read 2850 times Last modified on Monday, 10 April 2017 10:00

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