Relaxed NY Liquor Authority Laws Provide Hope For Economic Viability of Restaurants & Bars

canned cocktails Relaxed Liquor Laws
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Until March of 2020 the only way New Yorkers were enjoying a to-go cocktail was if they were hiding it in a paper bag.

Unlike cities such as New Orleans and Mobile, which allow public consumption of alcohol beverages, New York’s State Liquor Authority forbids the practice walking out the door of a bar or restaurant with cocktail in hand.  That is until the COVID-19 pandemic hit, bars and restaurants were shuttered, and the reality became that up to 60% of these establishments would not survive without some extraordinary solutions. Cue the lobbying from groups like NYC Hospitality Alliance resulting in Governor Cuomo’s mandate that bars and restaurants could sell cocktails to-go along with a food item. This relaxed legislation took businesses from screeching halt to head scratching about execution.

Bars were on their own trying to navigate the new regulations in a profitable way.  Bill Edwards, SVP of National Accounts for Southern Glazers Wine & Spirits, notes, “To-go cocktails were a lifeline for a lot of our customers to pivot and take care of guests and have some sort of revenue stream.  I think early on people were just trying to do anything just to get something up and running and looking at whatever they had in their back storeroom and said, ‘Let’s get something to generate revenue.’”

Alyssa Sartor scrambled with a plan. Her newly opened August Laura in the East Village didn’t have the luxury of resting on an established reputation. She comments, “Being a new business this lull was detrimental because we ran the risk of not being remembered.”

Karl Franz, Owner of 67 Orange Street took a beat to do some serious financial assessments along with critical competitive research. He explains how he sprang into action to evaluate their survival, “In just looking at our holding costs – rent, insurance, utilities – we’d burn through our reserves really quickly. And I wondered, if we lost two weeks of revenue entirely, could we make it up by offering to-go cocktails?  So, what I did was to start looking at what our competition was going to be; it was going to be other bars, and liquor stores.”

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67 Orange Street Cocktails

This pandemic only ratcheted up the usual competition of bars and retailers vying for customer dollars and forced many bars and restaurants to re-evaluate their pricing in a to-go world. Franz notes, “I knew I couldn’t shoot for $17 per drink like I normally would when I’m competing with a liquor store that runs at a 40% margin.  At that gap people won’t buy my stuff.  So, we dropped our margins to mirror what liquor stores were charging.  Our initial offerings were cocktail kits that had all ingredients plus a full bottle of liquor to make the cocktails or they could order a punch that was pre-made.   The benefit to the customers was convenience; they didn’t have to make two stops – grocery store and liquor store – they could get it all in one place from us.”

Consumers are willing to pay a premium over retail for having it delivered, but it cannot be the same pricing strategy as it was for people sitting in your restaurant.

Edwards notes, “Restaurants need to look at their strategies and understand the consumer need. For example, broadcasting the fact that you are taking extra steps by offering packaging that is tamper proof/tamper evident – it all plays into the psyche of how they’re going to choose.  You can’t just say ‘I used to charge $xx for this wine on my wine list and that is what it will be now.”

Moonrise Izakaya Sorta OpenNow Josh Battista, Beverage Director of Moonrise Izakaya holds court at a bar without customers gathered around it.  Gone is his opportunity for individual conversations about his sake and highballs only menu.  To-go forced this neighborhood gem flex their cocktail muscles and converting their cocktail program has proven to be successful.  Battista explains, “Our cocktail program is one of the things that is keeping the doors open.  We went from our only options of highballs, which are great, but they’re not popular enough to get attention, to creating a menu of things people want to drink for summer.”

This included investing in a frozen drink machine.  Demand is so high Battista is batching multiple times a week, keeping his distributor and liquor partners happy, as well as his customers. Offering familiar flavor profiles entices guests to try new ingredients, like yuzu, without worry about waste.  Battista shares “Because you are creating in bulk (i.e. batching the cocktails) it allows you to order in bulk with low storage.”

In addition to respecting inventory considerations, the guest experience remains top of mind.  At The Smith, Vice President of Operations Adam Burke notes that the guest experience at home with a to-go cocktail should mirror the old way of dining as much as possible.

The Smith jarred drinksHe explains, “For us it was very important that our to-go cocktails reflected what people know of us.  We took a look at this opportunity to figure out what is the easiest way we can bring this to people to try and recreate their Smith experience.  We selected our best sellers on our list and offer them as two drinks in one vessel in a way that is accessible and super easy to enjoy throughout a meal.  Now when our guests call in an order they can remember, ‘I’m getting the chicken salad I love and can now also get the cocktails I love.’  Our cocktail to-go program offers something a little closer to what they’d been missing when dining at the restaurant wasn’t possible.”

Even though a return to the dining room is now possible throughout New York the reduced capacity restrictions means that to-go drinks are not going anywhere soon. On September 24th, the Governor’s office announced they had extended once again the window for to-go cocktails.  “By extending cocktails to-go, Governor Cuomo will provide a critical lifeline to local hospitality businesses that continue to struggle with the devastating impacts of COVID-19,” said Jay Hibbard of the Distilled Spirits Council of the United States.

Operators like Franz, Burke, Battista and Sartor are hoping that the Governor will shift from renewing these relaxed regulations every 30 days, leaving them unable to forecast and instead follow in the footsteps of Iowa and Ohio, both of whom have made a to-go measure in response to COVID-19 permanent.

A permanent to-go cocktail policy in New York would be most appreciated.  It is an easy way for people to enjoy dining at home at an otherwise stressful time.  It has also given people a new way to interface with their favorite bars and restaurants.  According to studies cited by Southern Glazer’s 63% of guests intend to continue ordering cocktails to go, even when dining in restaurants is possible.

So, as Edwards says, “It seems to be common sense that this is something we look to extend because it is for the greater good.”

  • Easy Ice
  • Cuisine Solutions
  • Imperial Dade
  • T&S Brass Eversteel Pre-Rinse Units
  • BelGioioso Burrata
  • Day & Nite
  • AHF National Conference 2024
  • Atosa USA
  • RAK Porcelain
  • RATIONAL USA
  • AyrKing Mixstir
  • DAVO by Avalara
  • Simplot Frozen Avocado
  • McKee Foodservice
Francine Cohen
Francine Cohen is an award-winning journalist covering the business of the f&b/hospitality industry, and a proud native Washingtonian (DC). In addition to her work as a journalist she keeps busy fundraising for Citymeals on Wheels, Les Dames d’Escoffier, NY Women’s Culinary Alliance, and the USBG Foundation and serves as chief storyteller and brand steward for clients in the food and beverage sector by providing them with strategic marketing and business growth guidance. She has never met a cheese or beverage she does not like, and lives with her husband in New York; leaving him behind to visit New Orleans every summer. (Except 2020. Darn pandemic.) You can reach her at francinecohen@mindspring.com
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