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By Pamela S. Erickson, M.A., CEO
Public Action Management, PLC
Former Director, OLCC Director and Prevention Advocate for Oregon Partnership
August 18, 2010
Strategies that reduce
cheap alcohol, curtail CADCA reported in
promotional practices, and February 2010: “…only 17%
of coalitions report being
limit availability (location, involved in limiting or
hours, products) are very restricting location and
effective. density of alcohol outlets.”
67% did compliance checks
Adding such strategies will and 64% helped enforce
complement enforcement laws.
efforts and provide a more
comprehensive prevention
program.
Why do we need special regulations
for businesses that sell alcohol?
Because some
normal business
practices — quite
legitimate for other
commodities —
may produce social
harm when alcohol
is sold.
As an illustration, imagine you decide
to buy a floral business…
Your business plan would
include:
1. Efforts to retain and increase customers
who are “frequent buyers” of flowers
2. Discounts and promotions to gain new
“flower-loving” customers
3. Advertising to young people to build a
future customer base
Your business plan calls for:
Marketing to heavy drinkers
and alcoholics. Estimates of Market Regulations
underage market are 11-18%; Prevent this
5-20% drink heavily or above Scenario: Large
recommended levels. Quantities of Cheap
Use of volume discounts to Alcohol Widely
encourage heavy use. Available and
Heavily Promoted
Marketing to youth to
encourage present and future
alcohol use.
The United Kingdom is an
example. Today alcohol is
available in bars, clubs and
grocery stores 24 hours a
day, 7 days a week.
They have high taxes, little
regulation, poor
enforcement and lots of
cheap alcohol.
The also have an alcohol
epidemic on their hands.
Source: Statistical handbook 2007 (British
Beer and Pub Association
Four large chains
control 75% of the
market.
Most use alcohol as a
“loss leader”.
Drinking at home has
increased.
The large chains are
locked in price wars.
Large increase in public
disorder crimes around
bars (vomiting, urination,
fights, vandalism).
Serving practices
promote rapid
intoxication.
“Predrinking” at home
increases bar
intoxication.
Hospital Admissions have doubled for liver
disease and acute intoxication.
Drinking and intoxication of youth 15-16 are
at very high rates, according to the European
School Survey.
100
90
80
70
60
50
UK
40
30 US
20
10
0
Use in past 12 Use in past 30 Drunk in past 12 Drunk in past 30
months days months days
Percent of 15-16 years olds consuming 5 or more drinks on 3 or more
occasions in the past 30 days
Availability. Allows alcohol to be sold by the bottle and the drink,
but limits the number, location, types of alcohol products, and
hours of outlets.
No “Bargain Booze”. Regulations balance prices, control price
competition, and restrict dangerous marketing and promotional
practices.
Children and Teens. Age restrictions protect young people from
the serious problems of underage drinking.
Drunk driving. Creates and enforces strict measures against
drinking and driving—sobriety checks, blood alcohol limits,
driver’s license suspension.
Education and Enforcement. Uses the carrot of education
(alcohol awareness programs, “schools” for offenders) and the
stick of enforcement (fines, community service and jail) when
education fails.
Source: Adapted from World Health Organization recommendations.
US SUPERMARKETS SELL DEREGULATION BY LAWSUIT,
CHEAP ALCOHOL LEGISLATION AND BALLOT
Retailer lawsuits against
market regulation e.g.
Costco v. Hoen
Legislative efforts to
increase retail availability
Ballot measure in
Washington State to
radically deregulate
alcohol…supported by big
box chains
How can supermarkets
survive?
“To earn a dollar,
supermarkets would
rather sell a $1 item 100
times, making a penny on
each sale, than 10 times
with a dime markup.”
Net profit for food retailers is
less than two pennies on each
dollar of food sales. Source: Food Marketing Institute
Cheap alcohol in stores
(sometimes 50 cents a
can for beer).
Increase in advertising
and promotion.
Increase in alcohol
availability, i.e. more
types of alcohol in
more places with
longer hours.
American Alcohol Consumption
5%
15%
Do not drink
Drink 1 - 11 per year
39% Drink 3 or less per week
Moderate drinkers
Heavy drinkers
29%
12%
Education about the value of
our regulatory system and the
importance of price, promotion
and availability.
Survey community
environment to assess prices,
promotions and availability of
alcohol.
Review current regulatory
measures that impact price and
availability.
Advocate for current and
enhanced regulatory systems.
Objectives: Methods:
1. Determine Survey prices in stores by
community problems reviewing weekly ad
with low prices. circulars.*
2. Educate local policy- Survey bar ad
makers about the promotional practices.*
research on price and Review laws/rules
problems for underage Report findings,
drinking. summarize research, and
3. Advocate for price make recommendations.
balancing policies. *Not a scientific determination of average or
lowest community prices.
Outlet density impacts • More outlets:
problems including • Increase heavy and
underage drinking. frequent drinking.
• Increase violence and
assaults.
• Increase underage
drinking.
• Strain enforcement
resources.
Objectives:
1. Identify problem areas
with high outlet density
and alcohol problems. Methods:
2. Ensure safe Identify a likely problem area
“entertainment districts” by blocks or census tracts.
2. Educate policy-makers
about outlet density and Count outlets and display on
alcohol problems. map.
3. Advocate for policies Obtain crime location data
that provide good balance from police and array on
of outlets for communities map.
and neighborhoods. Develop report for
educational use.
Advocate for local control
over community outlets.
Deregulation is incremental and occurs slowly over time.
Reversal is difficult.
The original purpose and safeguards of retail stores
systems should be recognized as valuable.
Any regulatory change should be carefully evaluated
based on likely change in price, promotion, or availability
and resultant increase in consumption.
Increase in outlets should also be evaluated based on
impact on enforcement resources.
“Alcohol Policy Research & Alcoholic Beverage Control Systems: An
Annotated Bibliography & Review,” NABCA, National Alcohol Beverage
Control Association, 2008
“What are the most effective and cost- effective interventions in alcohol
control?” World Health Organization, February 2004
“Competition and Profit,” Food Marketing Institute Website (PDF about
grocery business today)
“The Dangers of Alcohol Deregulation: The United Kingdom
Experience,” by Pamela S. Erickson, available on-line at
www.healthyalcoholmarket.com.
“What are the most effective and cost-effective interventions in alcohol
control?” World Health Organization, February 2004.
“Alcohol Outlet Density and Public Health,” Marin Institute,
www.MarinInstitute.org.
“Fact Sheet: Alcohol Outlet Density,” Alcohol Issues Committee, Capitol
Neighborhood, Inc., Madison, Wisconsin.
“More Alcohol Sales Sites Mean More Neighborhood Violence, New
Research Finds,” Science Daily, February 22, 2010.
“How Alcohol Outlets Affect Neighborhood Violence,” Kathryn Steward,
Pacific Institute for Research and Evaluation.
“The relationship of alcohol outlet density to heavy and frequent drink and
drinking –related problems among college students at eight universities,”
E.R. Weitzman, et al, Harvard School of Public Health, Health and Place,
www.elsevier.com.
“Why do alcohol outlets matter anyway: A look into the future,” Paul
Gruenewald, Prevention Resource Center, Berkeley CA, Editorial, Addiction,
2008.
Purpose is to get an idea of prices for typical alcohol products that are
readily available. Purpose is not a scientific survey.
Method is to review weekly ad circulars for major grocery and/or liquor
store chains that sell major quantities of product on sale. The best
method would be weekly tracking for 52 weeks and identify change over
time. Prices are seasonal, so expect some ups and downs; for some
weeks alcohol may not on be on sale or advertised in a circular.
Track products that kids are likely to drink: beer (not micro-brews), low
end spirits, usually vodka, and cheap wine. (Remember that girls and
boys drink different products)
Don’t need to decide exactly how cheap is too cheap. There is no
standard in the US. Some Canadian provinces have “social reference
pricing” which is basically a minimum price.
Don’t make it too complicated. This is an informal survey not a
scientific analysis. But, it does answer the question about how cheaply
you can get alcohol in your community.
What is a drink size?
Beer: 12 oz= 1 drink (@ 5% alcohol)
Wine: 750 ml= 5 drinks (@ 12% alcohol )
Spirits: 750 ml= 17 drinks (@40% alcohol or 80 proof)
Calculations:
30 pack of beer @ 15.99 plus 8% tax=$17.27/30 or $.58.
Low end vodka @ 9.99 plus 8% tax=$10.79/17 or $.64
Two-buck Chuck @ 2.00 plus 8 % tax=$2.16/5 or $.43
Large jug wine @ 9.99 plus 8% tax=$10.79/20 or $.53 (large bottle is 3 liters which contains 20
drinks)
Example: Week of July 5-11, Phoenix Metro area
Store 1 (Albertsons):
Cheapest Beer: $.67 for 18 pack
Cheapest Wine: $.51 for 6 bottles of 1.5L wine’ $.57 for 3
Cheapest Spirit: $.23 for 1.75L vodka for 6 or $.26 for one
Store 2 (Safeway):
Cheapest Beer: $.78 for 18 pack
Cheapest Wine: $1.80 for 6 bottles
Cheapest Spirits: $.46 for 1.75 L; $.42 for 6 bottles
Store 3 (Bashas):
Cheapest Beer: $.56 for 30 pack
www.healthyalcoholmarket.com for Healthy Alcohol
Marketplace newsletter and resource material
