Economy not slowing NH liquor sales

MANCHESTER - If you're having an alcoholic beverage this Super Bowl Sunday, you've got plenty of company.

Even with the economy down, liquor sales in New Hampshire are up -- about 4 percent higher than last year at this time, according to Mark Bodi, chairman of the New Hampshire State Liquor Commission. And profits are up even more, about 8 percent.

Bodi says that's partly due to out-of-state customers -- who represent nearly half of NHSLC annual sales -- taking advantage of the state's value pricing.

"Just as consumers are moving from Macy's to Marshall's and the like, and are seeking more value, so, too, is this out-of-state segment who shops in our stores," Bodi said.

The liquor commission is "aggressively marketing" its products, he went on, "so we can capitalize on this opportunity, and to leverage this unique value position that a down economy presents."

And the NHSLC recently upwardly revised its revenue estimates for wine and spirits to reflect a 10 percent growth rate this fiscal year.

Not all categories are up. Bodi said sales of "finer wine" -- wines above $25 a bottle -- are off. But offsetting that are strong sales of "commodity" wines, including boxed wines and larger-size bottles.

Beer sales also seem to be trending up, after being flat for about five years, Bodi said. "Beer is now seeing a slight reversal in that trend, as many consumers kind of come back home to their favorite brew ... because of the price advantage that beer holds over spirits and wine," he said.

Liquor sales to restaurants are down about 3 percent from last year, Bodi said. And in December alone, sales to restaurants were off more than 8 percent; the NHSLC chairman believes that's in part because folks held fewer holiday parties.

But there's an upside to that trend for consumers: "There's great value on wine lists as restaurants move to accommodate consumers' needs," Bodi said.

That's what Charles Rolecek, president of the Premier Companies, has done at his two fine dining establishments: Bedford's C.R. Sparks and Hanover Street Chophouse in Manchester.

Rolecek said even with business down this winter -- which he attributes both to the recession and the inclement weather -- alcohol sales as a percentage of total sales are up about 3 percent. But folks are changing the kind of alcoholic beverages they're ordering.

Rolecek noted wine prices increased last fall, just as the economic downturn was hitting hard here. And in December and January, he's seen wine sales drop off in his restaurants.

Wine used to represent 60 percent of all alcohol sold in his eateries; now it's only half. Beer and spirits both now make up a greater proportion of alcohol sales.

"We're deducting that some people are moving down, trying to save a few bucks, and are drinking a beer instead of an $8 or $9 glass of wine," he said.

Rolecek, the past president of New Hampshire Lodging and Restaurant Association, said he's hearing the same from other association members. And it's happening on the food side of the menu as well.

"Instead of coming in for a brick oven pizza and a glass of wine, they're coming in for two beers and talking to their friends at the bar and then going home," he said. "Or they're coming in for dinner and they're being very sensitive to how much they order and what their total check is."

So over the past week, Rolecek has adjusted his wine lists to include more bottles in the $35 to $60 range instead of the more expensive wines that dominated previous menus. They'll also look to special wine promotions to try to lure customers.

"We're willing to literally cut back on some of our profit margin to stimulate the wine sales again," he said.

Bodi expects restaurant sales will begin picking up over the next several months as owners make such adjustments.

Even while alcohol sales to restaurants have dropped, the state is seeing an increase in beer and wine sales to grocery and convenience stores -- up nearly 8 percent in the fiscal year that began July 1, according to Bodi. He believes many consumers are altering their hospitality habits.

"We can't tell how much they're drinking, but we know with empirical evidence their patterns of where they're drinking are changing. They're doing it much more at home than they have in the past," he said.

And as a result, "Many consumers are buying wines at grocery and convenience stores to enjoy at home. Instead of going out to dinner and having two glasses of wine or more, they might have one, and come home and enjoy a glass at home."

Judy Chong, director of communications and public affairs for Shaw's Supermarkets, said her company is seeing "strong" sales of beer and wine, which she, too, attributes to the economy. "With more people dining at home and preparing meals at home, they pick up that bottle of wine," she said. "They're also entertaining friends at home.

"During tough economic times, when household budgets are feeling squeezed, we see this type of behavior," she said.

Chong said store managers also have noticed folks "trading down," in both food and alcoholic beverages. "They're looking for more value," she said.

Mike Norton, director of communications for Hannaford Supermarkets, said his company is seeing the same trends among its New Hampshire customers. "They're entertaining at home, and when they entertain at home, they're looking for really good value," he said.

That's why, although wine sales are up in terms of units sold, profits have remained flat.

Norton said value-priced limited reserve wines are among the categories folks are buying more often. "They just seem to have sharpened their game a little bit more, making sure they're getting a good value."

Also up are sales of boxed wines, once snubbed by wine connoisseurs, but now gaining greater acceptance as better varieties and different sizes have become available in that packaging, Norton said.