New law allows for home alcohol delivery

The business of home delivery in Tennessee is expanding into an untapped market: liquor.

Gov. Bill Haslam signed a bill into law last week that will allow third-party restaurant delivery services, such as GrubHub, OrderUp and Delivery Dudes, to purchase alcoholic beverages from licensed retailers and deliver it straight to consumers' doors. The law takes effect July 1.

Packaged liquor stores are already allowed to deliver directly to consumers after legislation passed last year, but many retailers opt not to provide that service. The new law allows companies that already deliver food products or prepared foods to also deliver alcohol.

Guy Stanke, owner of the Nashville-area Delivery Dudes service, anticipates an increase in sales of 50-100 percent once his drivers can start delivering alcohol to consumers.

"It's substantial," he said. "The demand for this kind of thing is very high."

Companies can deliver up to 1 gallon of alcohol per customer per delivery, and delivery drivers must require customers to show a valid form of identification, according to the legislation. Drivers delivering alcohol must also be 21 years old and pass a criminal background check.

In addition at least 50 percent of the delivery service's gross sales must come from food delivery. Delivery service companies and drivers will have to obtain a state license to deliver alcohol.

State Sen. Jack Johnson, R-Franklin, a sponsor of the bill, thinks the regulations in the law are going to prohibit or at least curtail deliveries to minors. He said the price will also likely make the service less attractive to "college kids," considering the service more of a luxury purchase.

The Tennessee Retailers Association and the Tennessee Alcoholic Beverage Commission did not oppose the legislation, Johnson said.

"Our motivation for this was to complement or go alongside with people who are ordering food," Johnson said.

"We don't want this to be just a pure booze delivery kind of system."

Stanke said Delivery Dudes already delivers alcohol to consumers in the South Florida market, and the business "absolutely" plans to start offering alcohol delivery in the Nashville area in July. The delivery service in Florida requires customers to fill out an online consent form and pay with a credit card. Delivery drivers must then check customers' identification and match that with the credit card used to purchase, Stanke said.

"I understand the seriousness of alcohol delivery and the amount of responsibility that carries, so I think that with that said, I believe that we're the right type of organization to do this," Stanke said. "Delivery is what we specialize in; we have the technology and people and training to do it properly."

Bard Quillman Jr., owner of Red Dog Wine & Spirits in Franklin, said although his business could deliver alcohol directly to consumers, he hasn't figured out how to profit from alcohol delivery without an upcharge for the service.

Quillman anticipates alcohol delivery to be more popular among urban dwellers than in the suburbs.

"I don't see there's any impact on our business whatsoever. … Somebody in the business is going to be getting a sale," he said.

Johnson argued the bill removes unnecessary regulation, but acknowledged it's in response to new delivery technologies as well. Although those technologies are relatively controversial at the statehouse — a new bill creating statewide regulations for ride-sharing services such as Lyft and Uber was hotly debated until the end of this year's session — Johnson said the state shouldn't ignore opportunities these technologies create.

"I think you're going to see more and more of this, and we just want Tennessee to be a hospitable place for that type of technology," Johnson said.

Reach Lizzy Alfs at 615-726-5948 and on Twitter @lizzyalfs. Reach Dave Boucher at 615-259-8892 and on Twitter @Dave_Boucher1.