Alcohol remains essential. As states across the country reacted to the coronavirus outbreak by locking down businesses — devastating on-premise — liquor stores wondered whether they, too, would have to shutter. So far, with rare exception, the answer is no.
The result has been a boom in sales as customers rush out to buy alcohol as the pandemic engulfs America. While this shopping spree has ebbed in recent days, many liquor stores still report higher-than-usual numbers.
Such a rise in customers complicates efforts to maintain safety. Retailers have needed to adapt. Nationwide, stores have implemented new practices that better protect customers and staff from the spread of COVID-19.
In this Part 1 of a two-part series on alcohol retail during the coronavirus, we look at these safety measures, current trends in consumer purchases, how else stores have adapted, and what all this means for beverage alcohol retail sales moving forwards.
The Initial Sales Boom
The week of March 9 was when many Americans first grasped the true extent of the pandemic’s threat. In a rash of troubling news, the NBA suspended its season, President Trump barred a litany of foreign flights, and “America’s Father” Tom Hanks tested positive for COVID-19.
Consumers reacted with panic and preparation, flocking to stores to stock up. Sales skyrocketed.
“For our New Jersey locations, during the week ending March 15, we saw a 62% increase in overall sales, a 20% increase in overall in-store foot traffic and a 300% increase in local delivery and pickup orders,” says Gary Fisch, founder and owner of Gary’s Wine & Marketplace.
This trend continued into the following week, as lockdowns took effect nationwide. At Caesar’s Wine & Liquor in Tennessee, during the 18-day period of March 12-29, total sales were up 71%, year over year.
Items per sale grew 20%, reports Caesar’s President Gary Gordin, while the average dollar amount per sale increased 41%. Customer count grew by 21%.
“Sales started leveling off Thursday, March 26, but dollar sales have continued the increase by 20%,” Gordin adds.
Womply, a data science company, reports a national weekly revenue climb of 145%, year over year, for liquor stores during that first week of the pandemic. This includes a spike of 278% on Monday, March 16.
“The data reveals what many have heard about or seen first hand,” says Dallin Hatch, Womply director of marketing communications. “COVID-19 is driving panic buying of liquor.”
Hadley Douglas, co-owner of the Urban Grape in Boston with her husband TJ, says that their sales have increased 130% these last two weeks.
For Peco’s Liquor Store in Wilmington, DE, this past week has seen a 15-20% sales jump, reports Owner Edward Mulvihill. And the week before that at Peco’s — as America settled frantically into its new reality, and the neighboring state of Pennsylvania closed down all liquor stores — sales were up 300%.
Taking Safety Precautions
With liquor stores experiencing numbers like another round of holiday season shopping, except during a spreading pandemic, additional safety measures were necessary. Retailers began these slowly at first, and then expanded.
“We ran our usual public tastings that first weekend [March 14-15], and then realized that we could not do that again,” says Douglas of The Urban Grape. “The news was getting progressively worse. We began reassessing what felt safe on a constant, almost hourly, basis.”
Boston being one of the first U.S. cities hit hard by COVID-19, The Urban Grape quickly adapted. On March 19, Douglas and her husband decided to shrink store hours. They no longer opened on Sundays, and also moved up closing time by three hours on the other days.
The Urban Grape is a boutique wine store in Boston’s trendy South End. “We decided that we would not open the store unless one of the owners was present,” Hadley says, “for the safety of our clients, employees and business.”
Now, only one customer is allowed in the store at a time. They cannot bring in kids or pets. They cannot touch product. They must sanitize their hands upon entering. After customers leave, The Urban Grape sanitizes door handles and the POS register touchpad.
The store also offers curbside pickup, and digital delivery.
“Most of our customers have moved to delivery,” Hadley says. “We don’t use a third party for delivery, so we’ve been able to give delivery shifts to industry people who otherwise were out of a job.”
Liquor stores can remain open in Minnesota, but many city-owned liquor stores have shut down as the cities close public buildings, says Tom Agnes, liquor operations manager at the two-unit Brooklyn Center Liquor in Brooklyn Center, MN.
“Some stores are staying open with some rules: steady sanitizing, distancing required, credit cards only, limiting 15 customers in the store at a time, no carry out or show-floor help, and one store put up Plexiglas shields,” Agnes adds. “We are considering the idea of opening with a parking lot delivery option.”
Delaware does not allow alcohol delivery sales, so Peco’s has implemented curbside pickup. People call in orders and the boutique store packs them up and runs them out to the customer’s car.
“That’s been very popular,” says Mulvihill. “A lot of people are traveling to our store because other stores aren’t doing pickup yet.”
Peco’s has limited the number of customers in their store to 10. Tape on the floor keeps people six feet apart while queuing at the register. After finding bulk hand sanitizer in the back, Peco’s put up hand washing stations throughout the store, but had to move these upfront after discovering that people were stealing the product.
Staff wear gloves, and sanitize the store whenever there’s a free moment. The sink for the growler station behind the register has made washing hands convenient for employees.
Gary’s Wine & Marketplace in New Jersey — another state walloped early on by the virus — took an even tougher approach.
“On March 21, in order to ensure the health and safety of our team and community, we decided to offer local delivery and curbside pickup only, closing our stores to in-store shopping in an effort to protect our employees and community, despite being deemed an essential business,” says Fisch. “Since this change, our team has successfully converted 100% of our in-store foot traffic to local delivery and curbside pickup orders that are placed through our mobile app and a new temporary website, www.garyslocal.com.”
This move, plus the inevitable decline in consumer panic purchasing, has impacted sales.
“For the week ending March 29, we began to see sales flatten,” Fisch says. “Our customer count was down 46% year over year, but this was offset by a 125% increase in basket size, year over year. The increase in basket size was largely driven by a doubling of our shipping business, where we tend to see larger basket sizes in general. We expect to continue to see a decrease in both customer count and basket size in the coming weeks.”
As expected, Gary’s already has a plan in place to deal with these large and evolving changes. In Part 2 of this series, coming early next week, we will examine how liquor stores have adapted strategy-wise to the coronavirus crisis, while also looking at what beverage alcohol products have sold best as America grapples with COVID-19.