Why Do Buyers Love Liquor Stores?
February 22nd, 2009
As a certified industry expert, whenever I list a liquor store of any size, I am bombarded by emails and phone calls. Many of these people turn out to be financially unqualified or tire kickers. And some are the competition – just checking to see what their business might be worth based on what another storeowner is asking for theirs.
Buyers with adequate funds are an interesting breed. Whenever I ask them why they want to buy a liquor store, I normally get answers like “it’s a cash business” or “everyone drinks in good times or bad times” or “it’s a real people business where you get to know your customers really well.” Never do I hear, “I expect to earn a fortune!” However, I have found that if a buyer listens to Bottom Line Management’s seasoned advice, he or she will have a higher earning potential and will contact us down the road to resell the store for much more than what it was purchased.
To be truly successful at owning, operating and selling a liquor store, you need to do four things. These basic concepts hold true for many other types of businesses as well:
- Acknowledge every customer when they enter your store. Immediately ask them if there is anything you can help them find. Once a customer finds what they want at a specific location, the chances are they will continue to patronize that same establishment.
- Never let a customer leave empty handed. If they could not find their first choice, ask them what their second choice might be. Offer it to them at a deep discount and throw in some chips or other snacks. This gesture will salvage the relationship and allow you to meet the customer’s needs and wants the next time around.
- Promise to order their preferred beverage whether it is wine, liquor or beer. And most importantly, get their phone number and let them know you will order the product immediately and will call them the day it arrives. And, make sure that you do call them when it arrives. You cannot imagine the goodwill you will create and the word of mouth and repeat business this will create.
- Leverage your inventory! As we all know, the most important aspect of real estate is location, location, location. In the liquor business, it is inventory, inventory, and more inventory. The key to success is to have enough working capital and physical space to take advantage of volume discounts from distributors. You want to be able to purchase the most popular wines and liquors at the greatest possible discount, and that can only be done in large quantities.
To effectively compete against the large superstores, you must be able to make great buying decisions and offer superior customer service. A customer will pay a little more if they like you and feel important when they enter your store.
And now, for a few of the real marketing freebees… To think outside the box, you need to do some of the following that most competitors do not even think of doing. Sponsor a wine tasting once a month. Offer a frequent customer program, with a percentage discount on every fifth purchase. Set a minimum for the first four purchases, but have no maximum for the fifth purchase where the customer receives the discount. Insert a flyer in each bag thanking the customer for their business and asking for any feedback that can help you make their shopping experience more pleasurable in the future.
Author’s note: After helping sellers and buyers for more than 20 years, I have found that honesty, integrity, full disclosure, patience and a willingness to consider various alternatives makes the probability of success for all parties very high.
As a certified industry expert, whenever I list a liquor store of any size, I am bombarded by emails and phone calls. Many of these people turn out to be financially unqualified or tire kickers. And some are the competition – just checking to see what their business might be worth based on what another storeowner is asking for theirs.
Buyers with adequate funds are an interesting breed. Whenever I ask them why they want to buy a liquor store, I normally get answers like “it’s a cash business” or “everyone drinks in good times or bad times” or “it’s a real people business where you get to know your customers really well.” Never do I hear, “I expect to earn a fortune!” However, I have found that if a buyer listens to Bottom Line Management’s seasoned advice, he or she will have a higher earning potential and will contact us down the road to resell the store for much more than what it was purchased.
To be truly successful at owning, operating and selling a liquor store, you need to do four things. These basic concepts hold true for many other types of businesses as well:
- Acknowledge every customer when they enter your store. Immediately ask them if there is anything you can help them find. Once a customer finds what they want at a specific location, the chances are they will continue to patronize that same establishment.
- Never let a customer leave empty handed. If they could not find their first choice, ask them what their second choice might be. Offer it to them at a deep discount and throw in some chips or other snacks. This gesture will salvage the relationship and allow you to meet the customer’s needs and wants the next time around.
- Promise to order their preferred beverage whether it is wine, liquor or beer. And most importantly, get their phone number and let them know you will order the product immediately and will call them the day it arrives. And, make sure that you do call them when it arrives. You cannot imagine the goodwill you will create and the word of mouth and repeat business this will create.
- Leverage your inventory! As we all know, the most important aspect of real estate is location, location, location. In the liquor business, it is inventory, inventory, and more inventory. The key to success is to have enough working capital and physical space to take advantage of volume discounts from distributors. You want to be able to purchase the most popular wines and liquors at the greatest possible discount, and that can only be done in large quantities.
To effectively compete against the large superstores, you must be able to make great buying decisions and offer superior customer service. A customer will pay a little more if they like you and feel important when they enter your store.
And now, for a few of the real marketing freebees… To think outside the box, you need to do some of the following that most competitors do not even think of doing. Sponsor a wine tasting once a month. Offer a frequent customer program, with a percentage discount on every fifth purchase. Set a minimum for the first four purchases, but have no maximum for the fifth purchase where the customer receives the discount. Insert a flyer in each bag thanking the customer for their business and asking for any feedback that can help you make their shopping experience more pleasurable in the future.
Author’s note: After helping sellers and buyers for more than 20 years, I have found that honesty, integrity, full disclosure, patience and a willingness to consider various alternatives makes the probability of success for all parties very high.
