Spoetzl Brewery Gift Shop in Shiner

[n5wmk]

Last week, I was at a car event in La Grange, and on Friday we had a drive to the Spoetzl Brewery in Shiner. Prior to the event, I had checked the TABC website, while there are three licenses for Spoetzl Brewery, the "Gun Sign" is blank. And while I did carry to the car event, I did not carry on the drive to the brewery, as I knew that I would be having some of their free samples.

As we walked in to the gift shop (where the free samples are served), from habit I looked for any signage at the entry point. Nothing posted. There was a long line to the back of the shop where the beer taps are, and when I got there I saw that they had the red 51% signs on the mirror behind the bar. I was a bit surprised by that. I don't find any evidence that the sign is required by the TABC (Spoetzl Brewery, Lavaca county is how I searched), and anyway the signs were not posted at the entrance.

And I don't think they could say that they derive 51% of their revenue for the sale of the beer in the gift shop, because they don't actually sell it. You walk up to the bar and they give you one sample and three more wooden tokens good for three more (total of four) tastings of their beers. The get a large revenue stream from the gift sales.

Just curious if I missed the TABC requirement somewhere (like maybe the gift shop uses a different trade name?), or if that is an improper posting.

Not that I plan on being back there anytime soon, but just wondering about it.

[RoyGBiv]

It's possible that the bar has a separate business license from the gift shop.

Not uncommon.

[KC5AV]

It's also possible that they just have the wrong sign.

[Carry-a-Kimber]

It's also possible that they just have the wrong sign.

This.
It is not allowed by TABC to sell beer at a brewery if it is also sold elsewhere. In Texas beer has to be "distributed" before it can be sold or only sold at the brewery, not both. Something about 2 revenue streams from one product.

[AEA]

The 51% is for CONSUMPTION on premises. Either bought, or in this case "free". That's my understanding anyway, but.....I don't get out much! LOL!

I am guessing the posted 51% at the bar (not at the entrance to the gift shop) is correct and that the bar is a portion of the brewery which does in fact get 51% or greater from the wholesale of their product (not a portion of the gift shop that requires no license at all).

[Jaguar]

If they are "giving it away", how can 51% of their revenue come from sales for on premise consumption?

[AEA]

It doesn't. That's the point.
If I could quote the 51% statue I would, but I can't remember it exactly. But I believe it says "Sales & Consumption".

I don't think it regulates "give it away" for consumption at all.

Another example would be this.......
We all know you can carry in a Liqueur Store. But, what about a Liqueur Store that is giving free samples of wine?

Another Gray Area. One that could be eliminated with "CHL carry wherever LEO's can carry".

[Carry-a-Kimber]

It doesn't. That's the point.
If I could quote the 51% statue I would, but I can't remember it exactly. But I believe it says "Sales & Consumption".

I don't think it regulates "give it away" for consumption at all.

Another example would be this.......
We all know you can carry in a Liqueur Store. But, what about a Liqueur Store that is giving free samples of wine?

Another Gray Area. One that could be eliminated with "CHL carry wherever LEO's can carry".

Not a gray area at all. Liquor stores and breweries are NOT licensed for on site consumption so, by law, the CAN NOT derive 51% of their income from the sale of on site consumable alcohol.
From TABC's website.

The second sign, the 51% sign, is to be posted on the premises of establishments where the possession of any concealed weapon is illegal. These are establishments that are licensed to sell alcoholic beverages for on-premises consumption whose alcohol sales constitutes more than half of gross receipts. These signs have 51% in large red letters superimposed over the warning and the warning notes that possession of a concealed weapon on the premises is a felony.

[JJVP]

Last week, I was at a car event in La Grange, and on Friday we had a drive to the Spoetzl Brewery in Shiner. Prior to the event, I had checked the TABC website, while there are three licenses for Spoetzl Brewery, the "Gun Sign" is blank. And while I did carry to the car event, I did not carry on the drive to the brewery, as I knew that I would be having some of their free samples.

As we walked in to the gift shop (where the free samples are served), from habit I looked for any signage at the entry point. Nothing posted. There was a long line to the back of the shop where the beer taps are, and when I got there I saw that they had the red 51% signs on the mirror behind the bar. I was a bit surprised by that. I don't find any evidence that the sign is required by the TABC (Spoetzl Brewery, Lavaca county is how I searched), and anyway the signs were not posted at the entrance.

And I don't think they could say that they derive 51% of their revenue for the sale of the beer in the gift shop, because they don't actually sell it. You walk up to the bar and they give you one sample and three more wooden tokens good for three more (total of four) tastings of their beers. The get a large revenue stream from the gift sales.

Just curious if I missed the TABC requirement somewhere (like maybe the gift shop uses a different trade name?), or if that is an improper posting.

Not that I plan on being back there anytime soon, but just wondering about it.

For some reason the "Gun Sign" entry is blank.

License #: B 464640

Trade Name: SPOETZL BREWERY INC
Owner: SPOETZL BREWERY INC.
Location Address:
603 E BREWERY STREET
SHINER , TX 77984
Mailing Address:
14800 SAN PEDRO 3RD FLOOR
SAN ANTONIO , TX 78232
County: Lavaca Orig. Issue Date: 1/3/2000
Status: Current Exp. Date: 1/2/2014
Wine Percent:
Location Phone No.: 2104909128
Subordinates: O
Related To: BA464642 Gun Sign:


License #: BA464642

Trade Name: SPOETZL BREWERY INC
Owner: SPOETZL BREWERY INC.
Location Address:
603 E BREWERY STREET
SHINER , TX 77984
Mailing Address:
14800 SAN PEDRO 3RD FLOOR
SAN ANTONIO , TX 78232
County: Lavaca Orig. Issue Date: 1/3/2000
Status: Current Exp. Date: 1/2/2014
Wine Percent:
Location Phone No.: 2104909128
Subordinates:
Related To: B 464640 Gun Sign:
License #: BI464643

Trade Name: SPOETZL BREWERY INC
Owner: SPOETZL BREWERY INC.
Location Address:
603 E BREWERY STREET
SHINER , TX 77984
Mailing Address:
14800 SAN PEDRO 3RD FLOOR
SAN ANTONIO , TX 78232
County: Lavaca Orig. Issue Date: 1/3/2000
Status: Current Exp. Date: 1/2/2014
Wine Percent:
Location Phone No.: 2104909128
Subordinates:
Related To: Gun Sign:

[Happily Ever After]

It doesn't. That's the point.
If I could quote the 51% statue I would, but I can't remember it exactly. But I believe it says "Sales & Consumption".

It says "if the business derives 51 percent or more of its income from the sale or service of alcoholic beverages for on-premises consumption" and they're giving it away so $0 income. I guarantee they're not giving it away to grocery stores.

[AEA]

It doesn't. That's the point.
If I could quote the 51% statue I would, but I can't remember it exactly. But I believe it says "Sales & Consumption".

I don't think it regulates "give it away" for consumption at all.

Another example would be this.......
We all know you can carry in a Liqueur Store. But, what about a Liqueur Store that is giving free samples of wine?

Another Gray Area. One that could be eliminated with "CHL carry wherever LEO's can carry".

Not a gray area at all. Liquor stores and breweries are NOT licensed for on site consumption so, by law, the CAN NOT derive 51% of their income from the sale of on site consumable alcohol.
From TABC's website.

The second sign, the 51% sign, is to be posted on the premises of establishments where the possession of any concealed weapon is illegal. These are establishments that are licensed to sell alcoholic beverages for on-premises consumption whose alcohol sales constitutes more than half of gross receipts. These signs have 51% in large red letters superimposed over the warning and the warning notes that possession of a concealed weapon on the premises is a felony.

Well, I'm totally confused now.......
The point I was trying to make was the difference between sales & on site consumption and free & on site consumption.

So I'll just bow out of this thread now and let others sort it out (as I should have done in the first place).

[srothstein]

Ok, let's try to clear it up for anyone who is confused. The 51% law is solely pertaining to income received from sales for on premises consumption. The law is Government Code section 411.204 and it specifically says "derives 51 percent or more of its income from the sale of alcoholic beverages for on-premises consumption". As you can clearly imagine, there is no way Spoetzl Brewery gets more than half of its income from sale for on-premises consumption.

Texas has, by law, what is called a three tier system of alcoholic beverage sales. This means that it is generally illegal for anyone who owns any part of a manufacturer to also own any part of a wholesaler or retailer. The same concept applies for all three levels. In other words, because Spoetzl is a manufacturer, it is illegal for them to sell their product to anyone other than a distributor, which must only sell it to a retailer. There has been some change in this as the business world has changed, so micro-breweries are now legal where they can manufacture for sale on their own premises only, as are wineries.

And that also explains why there is no gun sign line on the Spoetzl license in the database. Since it is impossible for them to get retail income, there is no question about the sign that should be present. There is no place in the manufacturer's license database for the question.

And that gets us to which sign should be there. One of the other tricks to remember is that there is only one license allowed to be issued per company at any single premise. So, if the property is owned and operated by Spoetzl, they MUST post a blue sign at the entrances to the property. Note that this is not the entrance to the sample room, but to the licensed property. If they have contracted out the operation of the sample room, then a red 51% sign MIGHT be possible, except for two other things. First, note again that the sign is income based. There is no income from giving away samples. So, if they sold a single other item or souvenir, they could not possibly get half their income from the sale of alcoholic beverages and it would be a blue sign. Second, as proof that it is not a contractor, there is another clause in our laws that prohibits what are called tied houses. A retailer must offer brands from more than one manufacturer for sale. If you went and they only offered Spoetzl's brands in the sample house, it must be part of the master license for the manufacturer.

My conclusion is that the red 51% sign must be wrong. I will give the caveat that it has been a few years since I dealt with this area and I could be wrong. There was a specialist at TABC in marketing practices and it was a very gray area that other agents would call him all the time with questions. There also could have been changes since I worked there. I would recommend a call to the local TABC office to ask them to verify which sign should be there.

[Katygunnut]

Ok, let's try to clear it up for anyone who is confused. The 51% law is solely pertaining to income received from sales for on premises consumption. The law is Government Code section 411.204 and it specifically says "derives 51 percent or more of its income from the sale of alcoholic beverages for on-premises consumption". As you can clearly imagine, there is no way Spoetzl Brewery gets more than half of its income from sale for on-premises consumption.

Texas has, by law, what is called a three tier system of alcoholic beverage sales. This means that it is generally illegal for anyone who owns any part of a manufacturer to also own any part of a wholesaler or retailer. The same concept applies for all three levels. In other words, because Spoetzl is a manufacturer, it is illegal for them to sell their product to anyone other than a distributor, which must only sell it to a retailer. There has been some change in this as the business world has changed, so micro-breweries are now legal where they can manufacture for sale on their own premises only, as are wineries.

And that also explains why there is no gun sign line on the Spoetzl license in the database. Since it is impossible for them to get retail income, there is no question about the sign that should be present. There is no place in the manufacturer's license database for the question.

And that gets us to which sign should be there. One of the other tricks to remember is that there is only one license allowed to be issued per company at any single premise. So, if the property is owned and operated by Spoetzl, they MUST post a blue sign at the entrances to the property. Note that this is not the entrance to the sample room, but to the licensed property. If they have contracted out the operation of the sample room, then a red 51% sign MIGHT be possible, except for two other things. First, note again that the sign is income based. There is no income from giving away samples. So, if they sold a single other item or souvenir, they could not possibly get half their income from the sale of alcoholic beverages and it would be a blue sign. Second, as proof that it is not a contractor, there is another clause in our laws that prohibits what are called tied houses. A retailer must offer brands from more than one manufacturer for sale. If you went and they only offered Spoetzl's brands in the sample house, it must be part of the master license for the manufacturer.

My conclusion is that the red 51% sign must be wrong. I will give the caveat that it has been a few years since I dealt with this area and I could be wrong. There was a specialist at TABC in marketing practices and it was a very gray area that other agents would call him all the time with questions. There also could have been changes since I worked there. I would recommend a call to the local TABC office to ask them to verify which sign should be there.

Just throwing this out there, but what if it is a contracted operation and the brewery pays the contractor for the samples that are "given away" to the public? Still doesn't address your point about a contractor having to sell more than one brand, but if they somehow get around that (possibly by having a few cans of Budweiser under the counter that are available for sale, but not displayed or marketed?), then it is possible that the contractor is deriving revenue for the beer sales even though the beer is free to the public.

[srothstein]

Just throwing this out there, but what if it is a contracted operation and the brewery pays the contractor for the samples that are "given away" to the public? Still doesn't address your point about a contractor having to sell more than one brand, but if they somehow get around that (possibly by having a few cans of Budweiser under the counter that are available for sale, but not displayed or marketed?), then it is possible that the contractor is deriving revenue for the beer sales even though the beer is free to the public.

Well, I have to admit that this would be an interesting case. I don't know if it would be legal for Spoetzl to pay for it, but I can't see how that would be different than me walking into a bar and buying a round for the house (well, besides their having the money to do it).

On a different note, the law about more than one brand actually includes situations like you mention. The other brands have to be prominently displayed and offered publicly, etc. It really is an attempt to force fair competition.

[poppo]

If they are "giving it away", how can 51% of their revenue come from sales for on premise consumption?

Well, technically 51% of $0 = $0. Since $0 is the total sales, then 51% of total sales = 100% of total sales, and thus is more than 51%.

In any case, whether or not the sign is valid, one should probably not be carrying and sampling.