Retailers Cautiously Optimistic On 2023 OutlookFebruary 3, 2023
After historically high sales during Covid, the retail segment has come back to earth over the past year, but retail players still report pockets of solid growth, especially in super-premium spirits and RTDs. “Premium wine and super-premium spirits continue to drive sales growth at Twin Liquors,” says David Jabour, president of the Austin, Texas-based retail chain. “Sales have moderated compared to the prior two years, but they are trending higher than anticipated.”
Some Covid-fueled retail trends have remained strong, while others appear to be tapering off. “E-commerce sales have subsided, and consumers are increasingly opting for an in-store shopping experience,” Jabour says. “Many consumers are choosing to celebrate and socialize at home.”
Retailers have also faced some significant financial hurdles as the on- and off-premise markets rebalanced. “The sheer amount of price and cost changes was something I have never seen in my 27 years in the industry,” says Dustin Mitzel, CEO of Happy Harry’s Bottle Shops in Fargo and Grand Forks, North Dakota. “Other challenges included managing increased freight costs from out-of-state to in-state and working through out-of-stock issues that carried over from 2021 into a large part of 2022. Hopefully all three issues will continue to get better into 2023.”
This year, Twin Liquors’ Jabour is confident that the off-premise will continue to be strong. “Sales volumes in the beverage alcohol retail tier will remain stable despite the prospect of economic headwinds,” he says.
In North Dakota, Mitzel is cautiously optimistic. “If inventory availability continues to improve, price increases slow down, and all internal costs continue to moderate, we should be better able to plan more strategically and see sales growth,” he says. “The last couple of years have been so volatile. It seems all we have been doing is reacting to what has been thrown at us on a seemingly daily basis and making sure we are making the best business decisions.” Market Watch has more.—Kevin BarrySubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.
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