$2 Billion Retail Powerhouse Spec’s Surfs Changing Trends In Texas Market

The Lone Star State is home to many large drinks retailers, but few have the scope and scale of Spec’s Wines, Spirits & Finer Foods. What started as a small family shop in Houston in 1962 has grown into a beverage behemoth of 216 stores and $2 billion in annual revenue. The business was started by Carroll “Spec” Jackson, and today his family’s fourth generation is joining the fold.

Though they’re all within the borders of Texas, Spec’s stores span a huge geographical area. The company has units in the state’s major cities—Houston, Austin, Dallas, and San Antonio—and also in markets like El Paso, Killeen, and Lubbock. Because Texas state laws prohibit beverage retailers from transporting products across county lines, Spec’s operations also include a network of distribution centers around the state.

“Spec started the business with the idea of giving customers a wide choice of items in all sizes and at fair prices, and he started with very little money in one small store,” says president and owner John Rydman, who married Spec Jackson’s daughter Lindy in 1971. Today, he says, “we’re doing well despite the lower customer counts and smaller purchases.”

Market Watch named Spec Jackson a Leader in its inaugural class of 1984. John and Lindy Rydman followed as Leaders in 1994 and elevated the store’s profile by being named Retailers of the Year in 1998, and they’ve also received awards for Community Service and Best Merchandising in 2012 and 2010, respectively. Their daughter Lisa Rydman-Lindsey was named a Market Watch Leader in 2016.

Spec’s stores range from 5,000 to 50,000 square feet and none of them are the same. “The product mix between spirits, wine, and beer changes based on the store size, demographics, and our vision for each location,” says lead spirits buyer Chris Detmore. Spirits dominate at 70% of total sales across the chain, followed by wine at 13%, beer at 8%, and food and non-alcohol items at 9%.

Rydman embraced wine early in his retail career, and he expanded Spec’s wine department from just 19 labels in 1972 to more than 15,000 today. Director of operations Steve Moore says sweet whites and reds are doing well, and that Provence-style roses also have a dedicated following. Overall, value-priced wines for less than $10 a 750-ml. are moving fastest, while wine-based RTD cocktails like Mimosas and Margaritas are also popular.

The chain’s top-performing wine brands range from Kendall-Jackson Vintner’s Reserve Chardonnay ($11) and Oyster Bay Sauvignon Blanc ($10) to Meiomi Pinot Noir ($17) and Josh Cellars Cabernet Sauvignon ($11). In addition, La Marca Prosecco ($14), Highway 12 Cabernet Sauvignon ($17), and La Crema Sonoma Coast Chardonnay ($16) are doing well.

In spirits, Detmore says boutique Bourbons, premium Tequilas, and spirits-based RTDs are dominant at Spec’s. Rising Tequila brands include El Tequileño, Don Julio, and Lalo, while Buffalo Trace is showing significant growth for Bourbon, and spirits-based RTDs like High Noon, Finnish Long Drink, and Jack Daniel’s & Coca Cola remain robust.

Of course, national powerhouses like Tito’s vodka ($32 a 1.75-liter; $18 a 750-ml.) and Svedka vodka ($17 a 1.75-liter) are strong performers, as are such whiskies as Jack Daniel’s black label ($39), Jim Beam ($23), Jameson ($26 a 750-ml.; $49 a 1.75-liter), and Crown Royal ($24-$27 a 750-ml., depending on the flavor).

“There have been some shifts from super-premium Tequilas to more affordable brands in the additive-free space, as well as a surge in reposado Tequilas,” Detmore says. “Bourbons, especially established well-known brands, are picking up steam and holding their own. The Buzzballz line has also become very popular, and another category doing well is flavored whiskey.” Detmore adds that THC seltzers, while still new in Texas, are also showing promise, and he expects flavored Tequilas to be an up-and-coming growth category as well.—Laura Pelner

Tagged : Buffalo Trace, Don Julio, Josh, kendall-jackson, Lalo, Meiomi, oyster bay, Spec's

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