Retailer

Can a Distributor Offer Free Labor to Install Glycol Draught Systems? Doesn’t the Rules Allowed Us to Provide Free Labor on the Original Installation if the Retailer Pays for the Equipment?

No. 100.210 states: “Distributor servicing, balancing, or inspecting draft beer or wine systems at regular intervals, and providing labor to replace or install rods, taps faucets, fittings and lines in draft beer or wine dispensing equipment, shall not be considered a subsidy. However, free cleaning of coils by a distributor by a company whose services are paid for by a distributor shall be considered a subsidy or something of value…” If free cleaning can’t be provided by a distributor then anything related to coil cleaning like installation of a Glycol system has to be paid for by the retailer.  The rule allowing for free labor is specific to the mechanics of the maintenance and repair of a tap system - not the regular cleaning and not original installation. 

The Commission has earlier stated that if a distributor is found guilty of giving a retailer a draught system or providing free labor to install a brand new system, the distributor may be fined up to $20,000 and have their license suspended for no less than 7 days. ABDI advises any distributor engaging in this activity to cease immediately.

As a distributor am I permitted to give glassware to a retailer if my supplier gives me the glassware free of charge?

No. According to Section 6-6 of the Liquor Control Act, no manufacturer or distributor may “directly or indirectly, sell, supply, furnish, give or pay for, or loan or lease, any furnishing, fixture or equipment on the premises of a place of business of another licensee authorized under this Act to sell alcoholic liquor at retail….”  

Section 6-6 (iv) also states: “…however, such items, for example, as coasters, trays, napkins, glassware and cups shall not be deemed to be inside signs or advertising materials and may only be sold to retailers.”

I realize that we are limited to a certain dollar limit for signs to be displayed at a retailer’s premises. What are the dollar limits again?

Each year a “cost adjustment factor” is used to update the signage dollar limits prescribed in Section 6-6 of the Liquor Control Act. The “cost adjustment factor” means a percentage equal to the change in the Bureau of Labor Statistics Consumer Price index or 5%, whichever is greater. Since 1997 the dollar limits have been significantly increased.

Dollar limits for signage (2016):

  • Permanent Outside Signs = $2,369.27 per brand (1997 amount $893)
  • Permanent Inside Signs = $5,308.19 per manufacturer (1997 amount $2,000)
  • Temporary Inside Signs = $867.21 per manufacturer (1997 amount $325)
  • Temporary Outside Signs = No dollar limit as you may only display one sign per brand

The General Assembly broke signage into 4 categories the mid-90’s (permanent outdoor, temporary outdoor, permanent inside, and temporary inside signs).

 OUTDOOR PERMANENT SIGN:

·         1 per brand

·         Shall only bear manufacturer’s name, logo, brand, symbol, etc.

·         Can include: cold beer, on tap, packaged liquor, etc.

·         Made of permanent materials (wood, glass, metal, mirrors, neon, or other materials reasonably considered to be of a substantially permanent nature).

·         Also includes signs painted on outside walls.

·         Signs attached to the outside of a window are considered outside signs.

·         Signs attached to the inside of a window are considered inside signs.

·         Brands that appear on an outdoor permanent sign may only have 1 temporary sign. In the example above, only 1 Old Style banner may be displayed.

·         MAY NOT BE RETAIL SPECIFIC

·         Must not exceed $2,369 per brand

OUTDOOR TEMPORARY SIGN:

·         1 per brand

·         Includes banners, flags, pennants, streamers and other items of a temporary and non-permanent nature.

·         Must include the manufacturer’s name, brand, trade name, slogan, markings, trademark, or other symbol commonly associated with identifying the product.

·         Signs MAY include the product, price, packaging, date or dates of a promotion and an announcement of a retail licensee’s event if the sign is intended to advertise the product and the event and promotion are simultaneous. STATE LAW DOES NOT REQUIRE OUTDOOR TEMPORARY SIGNS INCLUDE A PRICE!

·         May include, community goodwill expressions, regional sporting event announcements, or seasonal messages. All examples above would be acceptable.

·         There is no limit on the number of times a logo may appear on 1 sign.

·         If two brands are represented on 1 temporary outdoor sign – both brands are not eligible for another temporary outdoor sign.

·         A two-sided banner, flag, pennant, poster, or streamer displaying the brand name on both sides is considered 1 outdoor temporary sign.

·         A multiple sided or wrap around sign or signs affixed to a pole, fence, or other stationary object displaying the same brand on both sides is considered 1 sign.

·         MAY NOT BE RETAIL SPECIFIC

PERMANENT INSIDE SIGN:

·         Unlimited (must not exceed the dollar limit)

·         Made of permanent materials (wood, glass, metal, mirrors, neon, or other materials reasonably considered to be of a substantially permanent nature)

·         Includes neons, lamps, clocks, lamps, mirrors, tap handles, decals, etc.

·         Must include the manufacturer’s name, brand, trade name, slogan, etc.

·         Permanent signs in a beer garden are inside signs

·         MAY NOT BE RETAIL SPECIFIC

·         Must not exceed $5,308 per manufacturer

·         Menus and alcohol lists are permanent inside signs – these MAY be retailer specific

TEMPORARY INSIDE SIGN:

·         Unlimited (must not exceed the dollar limit)

·         Includes lighted chalk boards, acrylic table tent beverage or hors d’oeuvres list holders, banners, banners, flags, pennants, streamers, posters, placards, bowling sheets, table tents, inserts for acrylic table tent holders, sport schedules, etc.

·         DOES NOT INCLUDE: coasters, trays, napkins, glassware and cups. These items MAY ONLY BE SOLD to a retailer.

·         Must include the manufacturer’s name, brand, trade name, slogan, markings, trademark, or other symbol commonly associated with identifying the product.

·         Temporary Inside Signs MAY be retail specific

Must not exceed $867 per manufacturer