Finding per-state alcohol prices?

May 15, 2007 1:43 PM

AlcoholPricingFilter: Search engines are failing me. I'd like to know more about how prices are determined for various bottles of alcohol across the USA. Published data, liquor taxes, and math... fun!

I'm in the process of doing some research, and what I'd like to do is figure out what a consumer would likely pay for a specific bottle of alcohol in a specific state. This is somewhat challenging since I know that states regulate and tax alcohol in different ways.

I found a price list of every alcohol sold by Virginia's state-run ABC store here (CSV format). Their site says that the prices INCLUDE a 20% state tax on distilled spirits.

So, if I normalized the Virginia price list by removing the 20% liquor tax, and then applied the liquor taxes present in each other state, would I have a reasonable approximation of per-state prices? (I know, there are a lot of different formulas in effect around the nation... yikes!)

I suppose it all comes down to whether the companies providing the alcohol to each state are charging the same prices across the board. Does anyone know of any published pre-tax MSRPs for alcohol? Any other resources I could tap into to get price data for non-Virginia states? Wine and beer data?

I welcome any facts and anecdotes that can point me in the right direction. Thanks Mefi!

posted by adamk to work & money (9 comments total)

I heard anecdotally that, in Virginia, Trader Joe's had some problems with their "Two Buck Chuck." It had to do with mandatory minimum pricing. I think what happened was that their sale price plus the alcohol tax plus sales tax was still below some threshold for which that quantity of alcohol could be sold. So, just taking 20% off the sale price may not get you to the "real" price. Just another wrinkle...Sorry I don't have a good media source for it.
posted by redarmycomrade at 2:22 PM on May 15, 2007

Different municipalities can also add their own tax, so there will be a difference between some counties in the same state, and even a difference between cities.

I did find a site with some liquor tax information.
posted by borkencode at 2:25 PM on May 15, 2007

Well, any state that has state-run liquor stores will publish price lists. Oregon publishes a PDF every month with liquor prices, as well as monthly discounts (there are a lot of them). There's a fair amount of bouncing around of prices even without sales, just a buck or two every few months, sometimes down, usually up. Liquor in California varies hugely. You can get a bottle at Costco for dirt cheap (way below Oregon's), and the same bottle at a small liquor store for maybe $10 more. I have no idea how you'd go about determining a 'standard' price for states like that.
posted by devilsbrigade at 2:40 PM on May 15, 2007

Within a state, the price will be different depending on where the alcohol is purchased. Pretty much just like everything else you buy, convience stores are more expensive than Costco.

Here in NM, two buck chuck is $ 2.99, plus sales tax.
posted by yohko at 2:50 PM on May 15, 2007

This doesn't apply specifically to liquor, but when I worked in the back-office of [insert name of large national pet-supply retailer here], I learned that their pricing varied according to neighborhood demographics and geographically varying costs of doing business. It wasn't just on the MSRP or a standard markup. For example, in their case they charged the highest prices for their goods in West LA and NYC, and some of the lowest prices were in middle-class areas just a few miles away.

I would expect that the same calculations might come into play when selling alcohol. Although the national-chain factor is also affected by state and local laws, you could compare the cost of a 6-pack of Budweiser in an LA Kroger with the same in a Portalnd Fred Myer with the same in a Houston Kroger with the same in a Cincinatti Kroger, and so on. I expect that they would vary, and not just because of taxes.
posted by Robert Angelo at 2:52 PM on May 15, 2007

Some good input, thanks!

How about wholesale pricing though? Do large-scale purchasers (liquor store chains, etc) across the nation obtain the goods from distributors at roughly the same price? I'd imagine there might be some variability due to shipping costs, but taking those into account would it hold that Grey Goose will tend to be more expensive than Smirnoff by (roughly) the same amount in every location?
posted by adamk at 5:08 PM on May 15, 2007

The economics of alcohol in the US are pretty interesting and extensive. The chain of distribution is heavily regulated amd decidedly non-competitive. As an outsider without a good relationship with a liquor distributor, determining cost of goods sold for a liquor store is certainly possible but probably pretty difficult even for a specific store, let along many, many stores. That's probably the biggest unknown. Your best bet to get that piece is with an estimate using stores' approximate costs of operations, the market in the area, taxes, any state regulations on price and actual selling price, all of which can be determined by observation, research and simple estimation. But since you're trying to determine the retail price without the cost of goods, you're going to have to have some idea what retail stores generally pay for their product. Even with all that data, any "formula" is going to be a complex task, and it sounds like you take a slightly more deterministic approach to procing than most think to be accurate. Access to that data in usable format will not likely be free if you can even find it. This is more of a career's work than an afternoon's idle Googling. At least that is my take...
posted by jcwagner at 7:33 PM on May 15, 2007

I used to work in the wine business, I can share what little I know. Each brand/label of alcohol will have only one distributor for a particular region. A region is usually a state, but in the case of a large state like California it's sometime split into north/south, etc and occasionally it can include multiple states. Like many other commodities there is a "rack rate" which is the standard list price, and then volume and/or sale discounts are applied. A winery or distillery will typically set a price at which they sell to the distributor, not the shelf price. This is further complicated by multiple price structures, for example one wholesale price for retail sales, another wholesale price for bottle sales at bars and restaurants and a third for "by the glass". By the glass is the lowest rate since it provides such great exposure and it's easy for people to commit to a glass of something untried as opposed to shelling out for a bottle. Finally, if you buy it at the production facility you will pay a small premium over standard retail, to avoid competing with and antagonizing the distributors. Not complicated enough? Keep in mind that the tax charged will vary not only by state but also by alcohol percentage, and that many brands are not available in every or even most states.

The largest distributor of wine and spirits in the US is Southern Wine and Spirits, if you can get some of their price books (there will be different ones for different regions) you'll have a good start. Any business that purchases alcohol at wholesale is likely to have one in the vast majority of states. Good luck!
posted by cali at 9:55 PM on May 15, 2007 [1 favorite]

yohko: Within a state, the price will be different depending on where the alcohol is purchased.

Not all states. F'rex, MI doesn't have state liquor stores, but they do regulate all alcohol sold in the state (most, if not all, is distributed through the State Liquor Control Commission), and it doesn't matter where you buy that bottle of Tanqueray, it's going to be about the same price everywhere. Beer and wine prices are slightly less regulated than 'hard' liquor, so you'll see occasional "sales" on them (fvo "sale" being $1 off per 6pack or bottle).
posted by jlkr at 4:23 AM on May 16, 2007