Early Numbers Show Arkansas Wine Sales Rising

Since October, when the state lifted a 21-year restriction, 47 grocery and convenience stores in Arkansas have received permits to sell wines grown in the state.

The grocery industry and the state’s five commercial wineries believe the change is a good one, and early figures from the state’s Revenue Division show a marked increase in money collected from native wine sales.

Arkansas charges a 5-cent tax on each case of native wine and collected 43.8 percent more revenue in January 2002 than in January of last year. In January 2001, the state collected tax on 3,799 cases of Arkansas-made wine sold in the state, while sales last month jumped to 5,464.

“This spring, [farmers will] be able to plant more grapes and vegetables. Agricultural needs ought to be greater and will stimulate their economic development,” said Polly Martin, president of the Arkansas Grocers and Retail Merchants Association.

Although grocery stores in Arkansas have been prohibited from selling wines, it wasn’t always that way.

Shortly after the end of Prohibition in 1933, the state’s Alcoholic Beverage Control Board began allowing grocery stores to sell wines made in the state. The practice continued until 1980, when the ABC board passed a regulation forbidding the sale of native wines in grocery and convenience stores. This put Arkansas wines on the same footing as wines made outside the state, which since 1935 had been sold only in package stores and restaurants.

The 73 stores that held native wine permits at the time of the moratorium were allowed to continue selling Arkansas wines, said Robert Moore, director of the ABC division. But only 28 of those have continued to operate under their original permits.

Legislation that would have allowed any type of wine to be sold in grocery stores failed in the General Assembly last year.

Liquor store owners objected to the bill, but no one objected when the ABC decided to lift its restriction on the sale of only Arkansas wines.

And, Moore said, no one has challenged a policy that clearly gives state-produced wines an advantage.

“There certainly is a constitutional challenge that can be made as to the current state of Arkansas law that, in essence, allows native wines to be sold on a broader basis in retail than out-of-state wines,” he said.

Now that grocers are permitted to sell the wines, the choice still belongs to the individual grocery store, including those within major chains.

“We’re glad we’ve been given the choice to make the decision independently,” Martin said.

Harvest Foods, for example, has been issued 14 retail wine permits, while Kroger has yet to obtain any.

“I think it’s good for the industry. I think it’s good for the farmer because we’ll be able to get more acres of grapes growing and planted that can be made into wines and juices,” said Al Wiederkehr, owner of Wiederkehr Wine Cellars in Wiederkehr Village (Franklin County).

Allowing wines back in the grocery stores will recruit a new demographic of wine users, said Paul Post, vice president of Post Familie Winery in Altus.

And while liquor store owners may argue that their business will suffer from the new competition, Post argues just the opposite.

“We see it [this way]: If Arkansans do taste the wines [from the grocery store], they’ll probably go to the package stores to see what’s out there,” Post said.

He expects to increase overall production at his family’s winery by at least 10 percent, or 15,000 gallons per year.

Robert Cowie of Cowie Wine Cellars of Carbon City (Logan County) also predicted that his sales will increase by 10 percent because a new group of customers will emerge.

“If the state doesn’t toot it’s own horn, why should we toot California’s? … Arkansas wine is good wine, and we have done a poor job of letting people know this,” Cowie said. “Anything this state produces by people in this state ought to be pushed. We push rice.”