Increasingly, naturals stores are introducing organic beer and wine sections to differentiate themselves in an competitive market.
Among the features flaunted at Alfalfa's, Boulder's newest natural foods store, are parking stalls with plugs for electronic cars, a stage for cooking demonstrations, an in-house smoker for bacon and a wood-fired oven for thin-crust pizzas and casseroles. Surprisingly though, the section that draws the most "oohs" and "ahhs," the thing that has Boulderites buzzing is the store's beer and wine section. Beer and wine? What's so special about that? Yes, libations are commonplace in many grocery stores, but not in Colorado. Until Alfalfa's opened its doors one week ago, liquor stores and grocery stores were never shaken or stirred—that is, friendly neighbors but never sold in the same location. So, what's up? After investigating, I discovered liquor laws in the Centennial State allow one store in a retail chain to sell alcohol. So far, Alfalfa's has just one store, so offering booze was a no-brainer for co-founder Mark Retzloff.
The plot thickens, though. I have reliable information, though nothing's been announced, that of the so-many-I-can't-count Whole Foods in Colorado, a Boulder store has been tapped to also start carrying alcohol. Obviously, this is a move to compete with the shiny, new Alfalfa's, but it also got the wheels turning. Might there be another motivation? How important is the beer and wine category for naturals retailers? It turns out, very.
Nutrition Business Journal reports that U.S. sales of natural and organic beer, wine and liquor grew 7 percent in 2010 to $1.0 billion. Could natural retailers be largely responsible for the increase? It would make sense for stores to tap into the trend as a way to differentiate themselves from conventional stores which are increasingly carrying natural and organic brands. Organic beer and wine is a perfect fit for natural retailers and a win-win for time-crunched, health conscious consumers who prefer to do all their shopping in one stop. I called Dave Taylor, category manager of beer and wine for the distributor KeHe, to see if my theory was correct.
"It's true, natural food stores are selling the most organic beer and wine in the marketplace likely because they're the ones putting the most effort into marketing."
Though alcohol doesn't have as high of margins as supplements or some other areas of the store, Taylor pointed out that wine is basically non-perishable and has very little return. Also, the price point of organic wine differs little from conventional. He referred me to Rudy Rodriguez, store manager of Nutrition S'Mart based in Palm Beach Gardens, Fl., who recently introduced an organic beer and wine section in his Tampa store, to great success. "Though it hasn't been measured, it seems that shoppers who buy wine are more inclined to increase the overall value of their shopping cart by including items to compliment it, such as gourmet cheese and crackers."
More organic beer and wine at my fingertips, continued category growth? I'll cheers to that!