State liquor sales rose during initial months of privatization

Though state officials said it is too early to glean long-term impacts of Washington’s new privatized liquor system, recent numbers show overall sales between June and September were higher than during the same period the year before.

Spirit sales by volume in Washington rose 2.9 percent during the first four months of liquor privatization compared to those months in 2011, according to data released by the state Department of Revenue.

About 13.6 million liters of spirits were sold statewide between June and September 2012.

During the same months in 2011, when state-run liquor stores were still in operation, about 13.2 million liters were sold.

Initiative 1183, which was approved by state voters in 2011, dismantled the state-run system of liquor sales.

Backers of the measure received massive financial help from Costco Wholesale Corp., which spent about $22 million during the initiative campaign. That campaign was the most cash-flush the state has ever seen.

The state Liquor Control Board closed its retail stores before the law took effect this past June.

Private retailers have quickly filled the void. Many large grocery stores, including Costco, Haggen and Fred Meyer, now sell spirits.

Consumers jump despite higher prices

Consumers shopping in retail stores purchased 7.9 percent more spirits between June and September this year than they purchased from state-run liquor stores during the same months in 2011.

Shoppers bought more booze even as prices increased by an average of 11.6 percent.

The average retail price on a liter of spirits, taxes included, was $24.09 in September 2012, according to the Department of Revenue. It was $21.58 at state-run liquor stores one year earlier.

That increase means consumers today spend nearly $2 more on a standard 750 ml bottle of liquor than they did last year, according to the revenue department.

Mike Gowrylow, the department’s communications director, said the wider availability of spirits was likely a major driver of increased consumer purchases.

“National studies have shown that when you make liquor widely available, people buy more of it, even if the price is a bit higher,” Gowrylow said.

Restaurants, bars buying less

Although overall sales volume of liquor grew during the initial months of privatization, purchases by bars and restaurants of spirits for on-premises consumption fell by 12.6 percent from the same period in 2011, according to the revenue department.

Gowrylow said many bars and restaurants stocked up on sprits in May of this year, the last month state-run liquor stores were open.

Purchases by bars and restaurants that month were up 47 percent from the previous year, according to the revenue department.

Gowrylow said the drop in purchases from bars and restaurants was likely due to several factors:

– Liquor prices for owners of bars and restaurants have increased, just as they have for consumers.

– With a greater number of outlets for consumers to buy spirits, bars and restaurants face weaker demand.

– More outlets selling liquor also creates competition on the distribution level, and bars and restaurants might be finding it more difficult to maintain their inventories, particularly with popular spirits or those with limited production.

Gowrylow said the state would need at least a full year of sales data before any long-term trends with the privatized system could be identified.

He said the state’s Office of Financial Management, along with the liquor board and the revenue department, plans to assess fuller impacts of I-1183, possibly within the next year.

Contact Evan Marczynski at or call 360-647-8805. 

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