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California Supermarket Chain Raley’s Ups Its Game In Beverage Alcohol

November 7, 2018

California-based supermarket chain Raley’s is a growing force, with estimated sales of $3 billion and 125 stores in California and Nevada under the Raley’s, Bel Air, and Nob Hill Foods banners.Beverage alcohol makes up about 12% of sales—or $250 million—according to estimates by SND sister publication Market Watch. Curtis Mann, who helms the drinks department as director of wine, beer, spirits, and beverage, came to Raley’s five years ago after a number of years with wine suppliers including Baldacci Family Vineyards and Trinchero Family Estates. He says an enhanced commitment to wine education for both Raley’s staff and customers has resulted in a huge uptick in sales in recent years.

Raley’s team of 35 wine stewards “encourages customers to experiment with different brands and regions they may have not tried before,” according to Mann. The stewards host weekly in-store educational tastings (where legal), and stay on top of their own training with weekly educational calls. “We talk about what they’ll pour at the weekly tastings, what’s new that’s coming into the stores, and some up-and-coming trends so they’re armed with good information when they go out and speak with customers,” says Mann, who was recently named a Market Watch Leader for 2018.

Wine is the biggest driver of beverage alcohol sales at Raley’s, followed by beer and spirits. Depending on the location, stores offer 1,000-2,000 wine SKUs, priced from $3-$300 a 750-ml. Mann is seeing strong performances from Australian wines priced at $10-$25, Oregon Pinot Noir, wines from California’s Central Coast, French rosé, Chablis, and Chianti. “As customers become more educated, they’re looking for appellation wines that have a designated quality attached to the name,” Mann says. But he’s also finding quality in boxed wines, a typically strong seller in supermarkets. “There’s a lot of high-quality wine going into boxed wines like Black Box and Bota Box,” he notes of the $20 3-liter packages. “Customers are realizing they can get quite a price-to-value offering there.”

The spirits selection at Raley’s ranges from 500-800 SKUs, priced from $7-$200 a 750-ml. “Tito’s continues to be a monster,” Mann says. “It’s on fire, and kind of overshadowing everything else.” Whiskies—including Bourbon, Scotch, Irish, and Japanese—also remain strong. “There are more and more interesting releases, and we’re really focused on finding those small-production, single-barrel batches,” Mann notes. Tequila, particularly at $20-$50, is likewise a robust performer. “Customers are starting to see that there are some really nice Tequilas that are $25,” says Mann.

The beverage alcohol departments at Raley’s stores don’t follow a standard footprint or cookie-cutter format. “Every venue has a different look and feel,” explains Mann. Three locations feature wine and beer bars, where customers can enjoy on-premise drinks along with prepared food items, while eight stores contain Borgen wine cases that can accommodate between 50-75 age-worthy wines. Raley’s sees opportunity ahead with the wine and beer bars, and he plans to open more. The chain also sells beer, wine, and spirits online in California and Nevada. In the Golden State, it provides delivery, though Mann says that most of the company’s online wine sales are through the “click and collect” pickup model.

Looking ahead, Mann aims to continue emphasizing the education piece. “We’ll continue to integrate customer service with the assortment,” he says. “And we’ll leverage our wine stewards even more. Education will be our biggest opportunity in the future.”Terri Allan

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