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Texas Shows Sharp Volume Increases In 2011 As Top Retailers Expand Across State

July 12, 2011

In the first half of 2011, wine, spirits and beer sales in Texas have shown significant acceleration, according to the Texas Alcoholic Beverage Commission. Wine volumes were up 8.2% in the six months through June, while spirits jumped by 5.3%. Beer’s turnaround was also strong: after sliding 2.2% to 265 million (2.25-gallon) cases in 2010, beer volumes rose by 2% in the first half.

A key development reshaping Texas in recent years has been retail consolidation. Houston-based Spec’s, with over $500 million in annual revenues (75% of which is from wine and spirits) has been opening as many as 10 new stores annually in recent years. Now at 90 units, Spec’s entered El Paso earlier this month, christening a 30,000 square-foot location that represents its first West Texas foothold. Another major retailer that continues to expand is Twin Liquors, the Austin-based retailer that’s grown into a 66-unit operation with stores blanketing the area from its home city down into San Antonio.

Centennial Fine Wine & Spirits, meanwhile, roughly doubled its number of stores and expanded its geographic reach with the purchase of Majestic Liquor’s 32 units in April for roughly $30 million. Centennial, which now has 67 stores, plans to add five more by next February, including two in formerly dry municipalities that recently went wet—Trophy Club near Fort Worth and Lowry Crossing in Collin County. The steady conversion of formerly dry counties in Texas (more than 20 since 2002) has opened up new markets for the industry. Centennial president Greg Wonsmos projects revenues of $250 million this year.

The craft beer surge has been slow to develop in Texas, but it now appears to be gaining momentum. Wonsmos said his company “is moving its focus to imports and craft beers.” Top Texas beer distributors Silver Eagle and Ben E. Keith have ramped up their craft activities, adding labels like Sierra Nevada, Magic Hat, Anchor, Dogfish Head and local Texas brew St. Arnold’s to their Anheuser-Busch-led rosters. Ben E. Keith went statewide with its craft distribution last year.

Texas is the fourth-largest market in the U.S. for both spirits and wine and second-largest for beverage alcohol overall, behind California. With growth accelerating in the first half of 2011, the ongoing expansion of its major retailers is likely to continue.

Texas – Alcoholic Beverage Consumption
(millions of gallons)
Calendar Year Percent Change1 Year-to-Date June Percent
Category 2008 2009 2010 2008-09 2009-10 2010 2011 Change1
Distilled Spirits 26.9 27.4 28.5 1.9% 3.9% 14.5 15.3 5.3%
Wine 40.5 42.2 44.4 4.1% 5.2% 22.2 24.0 8.2%
Beer/Ale 607.7 609.5 596.2 0.3% -2.2% 286.1 291.8 2.0%
Total Texas2 675.1 679.2 669.1 0.6% -1.5% 322.8 331.1 2.6%
1 based on unrounded data
2 addition of columns may not agree due to rounding 

Source: Texas Alcoholic Beverage Commission

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