Changes to Case Discounts
Please be aware of changes to laws related to case discount pricing that go into effect on January 1, 2023. Retailers will no longer be allowed to offer case discounts that reduce the retail price of wine less than 20% above wholesale cost or liquor less than 10% above wholesale cost.
2018 Pub.Acts, c. 783, set a minimum retail price for liquor. See also T.C.A. 57-3-1001, et seq. The act required retailers to sell liquor for at least 10% more than their wholesale cost. The act created some exceptions to this minimum markup. One exception was for case discounts. Under the act, a retailer was allowed to discount their prices for customers who purchased cases of liquor to less than the minimum markup, though they were still prohibited from selling below their original wholesale cost.
Similarly, 2014 Pub.Acts, c. 554, set a minimum retail price for wine. See also T.C.A. 57-3-901, et seq. Retailers were prohibited from selling wine for less than 20% more than their wholesale cost. The act created some exceptions to this minimum markup. One exception was for case discounts. Under the act, a retailer was allowed to discount their prices for customers who purchased cases of liquor to less than the minimum markup, though they were still prohibited from selling below their original wholesale cost.
2022 Pub.Acts. c. 859, which goes into effect January 1, 2023, deletes these two exceptions to the minimum markup requirements for wine and liquor.
Beginning January 1, 2023, case discounts will no longer be excluded from the general minimum markup requirements. A retailer may still offer discounts to customers for purchases of wine or liquor by the case, but those discounts may not reduce the price below the general minimum markup requirements.
