Exclusive news and research on the wine, spirits and beer business

Retailers Across The Nation Are Still Rushing To Keep Pace With Demand

March 20, 2020

As the week began drawing to a close, beverage alcohol retailers nationwide were still scrambling to restock their shelves amid a run on purchases, while also taking steps to keep customers and staff safe.

Exit 9 Wine & Liquor Warehouse near Albany, New York, has seen its business quadruple over the last week. “It all started on Thursday of last week and then just went crazy,” said owner Mark O’Callaghan, whose one-unit operation does more than $18 million in annual sales. “This is higher than our holiday numbers. It’s insane. We sold out of just about every staple you can imagine, and we’re just now getting everything replenished. The weekly numbers are about 400% higher than what we normally do at this time of year, and our online pickup and curbside delivery are through the roof. We usually have one or two deliveries a day, and we’re now doing about 40-50. We bring the purchases out to customers’ cars after they order online.”

Armando Luis, president and owner of the 2-unit Sparrow Wine & Liquor Co. in Hoboken, New Jersey, whose annual sales are at around $10 million, has seen a major jump in foot traffic as well as sales. “We’ve probably had our busiest string of consecutive days ever—definitely busier than around Christmas and New Year’s,” he said. “Delivery-wise, our business is up by something like 300%.” Luis noted that Sparrow’s customers are generally stocking up on wine and beer more than spirits. “Josh Cellars and Kendall-Jackson are flying off the shelves,” he added.

Elsewhere in New Jersey, Gary’s Wine & Marketplace has been getting orders for local delivery at a rate of 1-2 every minute, owner Gary Fisch told SND yesterday, adding that his stores remain open. “I keep reminding my team that they don’t have to come in, but we haven’t gotten any takers so far,” Fisch said. Gary’s does annual revenues of around $55 million.

At Zachy’s Wine & Liquor in Scarsdale, New York, the number of online and in-store pickups also has jumped significantly, with customers mainly focused on mid-tier offerings. “But we’re still very busy both with in-store traffic as well as the web, and most of our orders have been a bit smaller than usual,” said Zachy’s president Jeff Zacharia. “Right now people are focused on regular wines and liquors more than the high end.”

In Louisville, Kentucky, Westport Whiskey & Wine has seen major sales spikes, despite reduced store hours and tasting events being canceled. “We’ve seen a lot of traffic—particularly from tourists who came to do the Bourbon Trail, only to learn that distilleries were stopping their tours,” said owner Chris Zaborowski, adding that this week’s announcement of a Kentucky-wide restaurant shutdown “spurred a round of grocery panic.” Zaborowski noted that customers are stockpiling beer, and that most other purchases have been for everyday, mid-tier products, with curbside pickup sales growing daily. Starting today, Westport is launching a To Go Menu that features pre-picked selections at moderate price points. “All wines will be 6 bottles in a tote bag, priced at least 15% off shelf prices,” Zaborowski said. “There will also be cocktail kits, like the Margarita and Old Fashioned. We’re even promoting a Bourbon Tasting Kit, inspired by the Whisky Advocate post from earlier this week (that encouraged social media tasting among whiskey lovers).”

Meanwhile, the focus on hygiene has intensified, with retailers enforcing stricter cleaning rules and social distancing. Yesterday, New York City retailer Astor Wine & Spirits converted totally to delivery and in-store pick-up. “But we’re still open for business and working, even though we’re backed up,” said wine buyer Lorena Ascencios. “Normally we can schedule deliveries for the next day, or maybe the day after. Now we’re a few days behind—we’re just trying to make it all work.” Ascensios added that people are buying a wider variety of products than usual. “The average ring is higher because we see people buying wine and spirits together,” she said, with wine’s sales boost coming mainly at the $20 tier.

Similar to Astor, Los Angeles retailer The Wine House is moving away from in-store sales. “Most likely, we’ll soon be heading in the direction of curbside pickup only,” said co-owner Glen Knight, noting that sales this week have been up 25%. “We’ll also be shortening our business hours by two to three hours a day.” Knight’s customers have been focused on mid-tier wines at under $25, and spirits at all price points. “The section with the largest increase in sales has been spirits,” he says. “Many of the spirits shelves—particularly for gin, Tequila, and whiskies—were emptied out last weekend.”

In Chicago, the 42-store Binny’s Beverage Depot chain in Illinois has kept all its locations open, though it’s encouraging customers to order online for in-store pickup or delivery through Instacart. Volume of Jameson and Bushmill’s Irish whiskies was particularly strong in the run-up to St. Patrick’s Day. Binny’s and others said the sales mix is essentially unchanged, but the quantities are changing. “The guy who once came in for a bottle or two of Jack Daniel’s is now taking home a case of six bottles,” added another local retailer. “More people are buying wine by the case too.”

While most retailers are remaining open, others besides The Wine House are also finessing their schedules. The single-store Surdyk’s in Minneapolis, for example, was open on Tuesday until 5 p.m. only (9 p.m. is the usual closing), and then offered only home delivery and curbside pick-up on Wednesday as the store went dark. Since then, hours have been limited to 12-6 p.m. “Our deliveries through Drizly and Amazon Prime, as well on our own trucks, have spiked by more than 40% this week,” said co-owner Melissa Surdyk. “People are using curbside pick-up as well.”

At the 11-store Haskell’s chain in Minneapolis, where annual revenues are $65 million, business has been up 50% over normal March levels, said chairman and CEO Jack Farrell. “This has been like a hurricane in Florida, with people rushing to stockpile everything,” Farrell said. “The last few days have been busier than anything we’ve seen since Christmas week.”

Sales at Fort Wayne, Indiana retailer Cap n’ Cork have jumped by nearly 30% at most of its 15 stores this week, noted co-owner Joe Doust. “Restaurants were shuttered here on Monday, and since then our business has been very strong,” Doust added. “Grocery lines are long, and so people seem to prefer shopping for beverages at a specialist.”

In Colorado, Wilbur’s Total Beverage in Fort Collins hasn’t seen much hoarding, said managing partner Mat Dinsmore. “People are buying a couple bottles of things, but not stockpiling—they’re purchasing a few days’ worth of supplies,” Dinsmore added. “Though restaurants are closed, the consumption pattern isn’t going to stop. It’s just shifting channels.”

Still, the situation remains uncertain. Dinsmore worries about breaks in the supply chain in the event that drivers start calling in sick and inventories are unable to be replenished. Perhaps the only positive aspect of the tariff fight with Europe is that wholesalers had stockpiled inventories of relevant European products ahead of implementation. Also, with bars and restaurants closed, the sole distribution focus is now on the off-premise. “I don’t think empty shelves are a threat yet,” said Farrell, noting that Haskell’s has raised weekly orders for Captain Morgan spiced rum at many of its stores from 10-20 cases to 30 or more, and distributors have been able to meet the new demand. Binny’s also reported no problems with shortages.

In addition, the possibility of retail closures remains a worry, at least in some states. Pennsylvania closed its 585 state-owned wine and spirits stores and online ordering on Wednesday, and Alabama has now closed 78 state-owned liquor stores—though it was still allowing limited curbside pick-up at the shuttered stores, with purchases limited to one 750-ml. bottle of wine and/or spirits and a six-pack of beer. Alabama’s 99 other state-owned stores remained open at press time, amid a rapidly changing, fluid situation.

Most retailers won’t close their doors unless they hear news of mandatory shutdowns like the ones that have hit restaurants and bars. “The orders keep coming—we just hope they don’t shut us down before we deliver,” said Fisch.

“Hoboken—a very compact community—has around 125 bars, and they’re all shut now,” Luis says. “Those would-be customers are coming to us for drinks supplies instead. I’m not sure how long this will continue. Obviously, at some point, they’ll probably have enough wine, beer, and liquor at home, and business will slow. But the past few days of traffic will probably more than make up for it.”—David Fleming, with reporting by Kevin Barry, Jessica Beebe, and H. Lee Murphy

Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.

Tagged : , , , ,

Get your first look at 2018 data and 2019 projections for the wine and spirits industries. Order your 2019 Impact Databank Reports. Click here.

Previous :  Next :