NON-LIQUOR ITEMSFOR YOUR LRSby Tim Vandergrift38 The <strong>Publican</strong>
<strong>BC</strong>’s LRSs are legally allowed to sell beer, wine, coolers, cider, and a full rangeof spirits. As a core selling proposition, these items are always in demand.However, <strong>BC</strong> liquor regulations mandate an astonishingly steep wholesalemark-up (123% on wine and 170% on spirits) and minimal price discounts tolicensees, leaving retail margins thinner than anywhere else in North America.This makes it imperative to maintain sales volume to drive revenue - always achallenging proposition, and never more so than when your competition facesthe same reality. It would be helpful to have another product proposition tosupplement revenue, one not constrained by alcohol pricing.The liquor act allows LRSs to sell packaged snacks, non-alcoholic beverages,<strong>BC</strong> Lottery products, and liquor-related items, such as glasses, bottle openers,and corkscrews. Available from a wide variety of wholesale outlets (except forthe lottery products), these non-alcoholic items can have both reasonablemargins and an appealing contribution to your bottom line. Every retailerneeds to keep a number of relevant, profitable items on sale in his store, bothto service customers whose retail experience will be enhanced by an add-onsale, and to take advantage of potential unplanned (impulse) purchase decisionsfrom consumers.A word on unplanned purchase decisions: conventional marketing wisdomhas always been that placement and good signage are the keys to influencingconsumer purchases. In the grocery industry it was accepted that 60-70% ofretail purchase decisions were unplanned, and well-crafted end-aisle displaysand display racks at checkout lines became ubiquitous in nearly all retailbusinesses.However, a recent Wharton School of Business study has challenged thecertainty of this idea. In this study, statistics show that while in-store marketingdoes have influence, it might be lower than 20%, and is influenced to a fargreater degree by the traits of individual shoppers, including age, income, andtheir shopping goals.Th authors of the study conclude that 1) consumers “just looking around”are more likely to make an impulse purchase than ones who show up with arequirement for a specific spirit or a bottle of wine to match with a meal; 2) ifyour LRS is a destination that appeals to consumers because of competitivepricing and positive shopping experiences, they’re more likely to make impulsepurchases; 3) external marketing efforts don’t influence impulse buying, unlessconsumers link it to in-store marketing; and 4) discounting is less effectiveat generating impulse purchases than having a full-service store with goodselection and a positive shopping experience.These observations lead us to the idea that your non-liquor product mix willbe determined by several factors:The <strong>Publican</strong>39
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