Minnesota Municipal Beverage Association Newsletter
(January 24, 2010 - January 30, 2010)
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As I See It...... 
 
 

Grab Bag

Awhile back, Brenda from Lakeville Liquor wrote an article in this newsletter about grab bags.

 

This was quite intriguing to me because I used to be a very big fan of the grab bags at Woolworth's.  So I thought I would give the wine "grab bag" a try.

 

However I have to say I was a little bit skeptical.  Who would want a wine in a brown bag?  But, we had quite a bit of clearance and slow movers to sell, so I thought what do I have to lose?

 

I took ten bottles and averaged them out to a cost that worked out to less than $9.99 (all of the bottles were at cost already).  I marked the UPC code with "GB" to note that we will not accept a return on this bottle.  I put the bottles in bags with a code, a $9.99 price tag for grab bag, red or white on the bag or nothing.  I then made an invoice to take the bottles out of inventory and into grab bag.

 

Then I waited.

 

WOW! I was really quite surprised to see the results from just the first week. 13 bottles had sold.  Definitely more than normally went out of the clearance basket!!

 

Now 3 months later, we have sold 137 bottles!!  To me that is just amazing!  Thank you Brenda!!

 

I encourage you to give this a try to move non-movers.  You could also try a liquor grab bag if you have more liquor to move.  Good Luck!!

 

If you have any questions, please feel free to contact me.

 

Virgene Shellenbarger

Liquor Hutch

MMBA Director

 

 

 

Cromwell Liquor Position Opening
Cromwell 
The City of Cromwell is now accepting applications for a liquor store manager.
 
City application, resume and references are required.
 
Deadline is February 12, 2010, 10 AM.
 
 
                                Click Here for More Information 
This Was From the Owners!!
 
No Help 
 
 
 
 
 
 
 
 
 
 
 
            
 
 
           
            Who hired these people?
 

Who trained these people?

How many times have you been in a business and received this kind of attitude?

Well, you won't be going back, and you will tell others the bad news. 

Then the "help" won't be disturbed by anyone.

Wine in Grocery Update 
SMART 

From Politics in Minnesota

 

Regular readers of the Politics in Minnesota (PIM) Morning Report know that we try to flag stories about issues in other states that mirror matters before the Minnesota Legislature. One of the phenomena we've noted in recent months is that groups pushing policy changes are trying to reconfigure those issues into fiscal ones. In other words, groups are trying to frame what would normally be termed policy changes as fiscal remedies for ailing state coffers.


Perhaps the most striking example of this phenomenon is what's going on in New York concerning the sale of wine in grocery stores. Last year, New York grocers introduced a simple bill to allow them to sell wine, and it was soundly defeated by the state's liquor stores. But the grocers of New York got busy, coming up with a comprehensive package that gives something to the liquor industry. This year's proposed "Wine Industry and Liquor Store Revitalization Act" would eliminate Prohibition-era restrictions by allowing liquor store owners to expand their product offerings to such items as wine accessories and snack foods, which they're currently prohibited from doing. (Minnesota, of course, has a similar law.) It would also allow wine to be sold in outlets that are currently licensed to sell beer.

Perhaps the biggest coup for the New York grocers was getting the buy-in from Democratic Gov. David Paterson, whose administration estimates the package would add $147 million annually to the state of New York. The bill is now part of Paterson's proposed $1 billion package of new taxes and fees.

 

Certainly there are differences between how New York and Minnesota currently regulate liquor distribution and sales, but the key point they have in common is that Minnesota also has a liquor law framework predicated on a post-Prohibition market order. Proponents of the revision to New York law now include the New York Farm Bureau, the New York State Grape Growers Association, the New York Wine Industry Association, and the faction of liquor stores that stand to benefit. What percentage of the New York liquor store industry supports the bill is unclear. But the liquor stores that oppose it have taken to calling Wegman's, a major regional grocery store chain, "greedy grocers."

 

We'll keep you posted on what happens in New York. Meanwhile, we checked with the Minnesota Grocers Association. The group does not plan to pursue wine in grocery stores this year, according to Jamie Pfuhl, the group's executive director.   

 

The New York WIG Story

 

Source: Legislative Gazette

by Stephanie I. Witkin

 

January 25, 2010

 

For the second year in a row, Gov. David A. Paterson included in his Executive Budget a proposal that would allow the sale of wine in grocery stores across the state.

 

The legislation would allow almost 19,000 retailers to sell wine alongside beer. The bill was first introduced in 1984 as part of a plan for New York state wineries to increase their marketing opportunities.

 

The bill, (S.5787/A.8632-a), sponsored by Sen. Liz Krueger, D-Manhattan, and Assemblyman Joseph Morelle, D-Irondequoit, was re-introduced in 2009 as part of the solution to alleviate the deficit. Paterson has added it again to his 2010-2011 Executive Budget in an effort to reduce a portion of the mounting $7.4 billion deficit in New York. If the bill passes then an estimated $147 million in new revenue would be generated over the next two years.

 

The most significant source of revenue would come from grocery stores and drug stores applying for licenses that would allow them to sell wine. Since 1998 all licensing fees have been deposited into the General Fund.

 

This year's bill has added new provisions to try to level the playing field between large supermarket chains and small mom-and-pop liquor stores. Some of the new provisions added to the bill are - liquor stores would be allowed to sell items complimentary to their business, they would be allowed to sell directly to restaurants and retailers, they would be able to form buying pools that would allow them to buy in bulk and lower costs. The new law would allow liquor store owners to obtain more than one liquor license which currently isn't allowed. The bill would also create a "medallion" system, through which existing store owners will be able to auction of their existing licenses to the highest bidder, and sell the one additional license this section allows them to obtain from the state Liquor Authority.

 

This bill would also bring about changes to liquor stores as well. Certain "antiquated" alcohol laws will be amended in order for liquor stores to compete fairly with grocery stores. "They are referred to as antiquated because most laws have not changed since 1933," said Jennifer Carlson, of the New York Wine Industry Association. "The fact is that New York wines have less than 3 percent of shelf space in liquor stores. . Any increase in exposure helps with their sales," she said.

 

Last year's bill was defeated after liquor store owners and sympathetic lawmakers expressed concern over unfair competition with grocery stores and large chain stores.

 

In a Cornell University study conducted by Bradley Rickard, assistant professor of applied economics and management at Cornell, a model was created that assessed the likely impact of introducing wine into grocery stores. Twenty-one simulation experiments were conducted and found that liquor stores stand to lose 17-32 percent of their business. Also, out-of state wineries would benefit from the bill and in most cases in-state wineries would gain revenue as well.

 

"Most of the arguments I make . support this bill," said Rickard. But, "I can't throw all my support behind it," because of the issue that liquor stores are going to lose revenue from wine sales. Rickard also said he would like to do more research about what the new provisions would do to help liquor stores. "I'm interested in trying to quantify the benefits of the provisions in the current bill," Rickard said. "I'm also curious about other provisions that aren't in the current bill."

 

But the issue is sure to be as contentious as it was last spring before the bill died.

 

"Sales are down dramatically. People are not buying wine and liquor. On top of that asking [liquor stores] to take a 30 percent pay cut is going to have a devastating impact," said Michal McKeon, a spokesman for the Last Store on Main Street, a coalition of small business owners.

 

Another concern for some is that 90 percent of alcohol sales to underage drinkers occur in grocery stores and convenience stores, according to those who oppose the legislation. "I don't know any teenager who would go to the shelf and pick wine over beer," said Carlson. The stores that are going to be selling wine already have alcohol such as beer; therefore Carlson says that underage drinking would not increase.

 

However, McKeon argues that this is not true. "Every gas station and deli is going to have wine. That is 19,000 new outlets. It is going to have an impact," on underage drinking, he said. McKeon also refers to a Columbia University study that found just as many teens would buy wine as beer. The Columbia University study found that 5 percent of the teens surveyed bought alcohol from a store and 34 percent got alcohol from a friend.

 

The Last Store on Main Street coalition is worried that letting grocery stores sell wine would drive them out of business. "It's a phony compromise that allows big box stores to crush our business. Being able to sell potato chips adds little to the devastating impact," said McKeon. "There is nothing more phony than big box lobbyists saying 'we're here to help you small businesses.' It's almost insulting."

 
Termite
Termite 
 
A termite walks into the bar and says 
 
"So, is the bar tender here?"
 
Future Dates to Remember!!
2010 MMBA Boot Camp,
 
February 22 - 24, 2010 Breezy Point
 
 
2010 MMBA / MLBA Legislative Day
 
March 1, 2010
 
2010 MMBA Conference
 
May 15-18, 2010 Arrowwood 
 

 
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Tobacco

A member recently asked about tobacco sales tax.

 According to the Minnesota Department of Revenue:
 
 Tobacco products (except cigarettes), including cigars, chewing tobacco, pipe tobacco etc. are taxable sales in Minnesota.
 
The standard 6.875% rate applies unless you have a special local tax.
 
Are You Getting the Most from Your Drink Menu?
Drinks

Your drink menu shouldn't just be a piece of paper that guests order from,

it should be used as a sales tool for your bar.

 

Here are a few ways to get increase profits with your menu:

 

Menu Descriptions

 

This is a place where lots of bars miss the boat.  If you only put

the name of a drink and the price on your menu, you're missing out

on a big opportunity to sell.  Think of the item descriptions on your

menu as mini commercials for those items.

 

As an example, instead of saying "Lemon Drop Martini" on your menu,

say this "Lemon Drop Martini: Pucker up with the delicious sweet and

tart balance of Absolut Citron, Liquor 43 and fresh squeezed lemon,

served chilled with a twist" 

 

Your Specials Board

 

Lots of bars have a specials board that they use to advertise their

current drink and food specials.  If you use a specials board, don't

order the items at random.  Lead with your high profit items, because

many customers won't read through all of the specials. 

 

Adding New Menu Items

 

Time to time you may want to add more items to your menu, but you don't

want to add something new to the menu just for it to bomb.  One way

to try out a new menu item to see if it's a good addition is by making

it a drink special or happy hour offering. 

 

Gauge the item's popularity by the amount of sales.  Get feedback by

having employees ask customers how they like

 the new item.

 

 

 Find out what your customers want and arrange your business and services to suit their needs