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West Lebanon liquor store is the latest addition to N.H.’s lucrative liquor empire

  • Kami Stone, left, is greeted by Nancy Pappas , both of Grafton, N.H., at the New Hampshire Liquor and Wine Outlet in West Lebanon on Thursday, Sept. 12, 2019 in West Lebanon. Pappas an employee at the store then helped Stone find things in the store for her upcoming camping trip. (Valley News - Jennifer Hauck) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

  • Just before opening on Thursday, Sept. 12, 2019, Heidi Guyette, left, manager of the New Hampshire Liquor and Wine Outlet in West Lebanon, N.H., works with employees Emily Benson, center, and Brenna Banley-Bill at the register. All three had worked at the New Hampshire liquor store in the Shaw's Plaza in West Lebanon. (Valley News - Jennifer Hauck) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com. Jennifer Hauck

  • New Hampshire Liquor and Wine Outlet employee Chuck Stone, right, helps customers Virginia and Lloyd Bennett, of Lebanon, N.H. find the wine Virginia was hunting for after the store opened in West Lebanon, N.H., on Thursday, Sept. 12, 2019. (Valley News - Jennifer Hauck) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com. Valley News photographs — Jennifer Hauck

  • Rick Ouellette, of Williston, Vt., texts a friend about the whiskey selection at the newly opened New Hampshire Liquor and Wine Outlet in West Lebanon, N.H. on Thursday, Sept. 12, 2019. (Valley News - Jennifer Hauck) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com. Valley News — Jennifer Hauck

  • New Hampshire Liquor and Wine Outlet in West Lebanon, N.H. opens on Thursday, Sept. 12, 2019. (Valley News - Jennifer Hauck) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

Valley News Business Writer
Published: 9/14/2019 8:53:44 PM
Modified: 9/14/2019 8:53:42 PM

Build it and they will come. With money. Verily, from Vermont and elsewhere in the Valley.

That’s the thinking behind the new New Hampshire Liquor and Wine Outlet in West Lebanon, a 19,000-square-foot wine and spirits store that is expected to become one of the top 10 liquor outlets in the state.

The $1.8-million superstore, erected in a parking lot off Route 12A and wedged between the Weathervane seafood restaurant, the New England School of Hair Design and the Valley News offices, opened on Thursday and is the latest retail location in the state’s 77-liquor store sales empire.

The Spartan, utilitarian structure — officially identified as Store No. 60 — replaces the state’s Liquor and Wine Outlet in the Powerhouse Plaza shopping mall with a warehouse-size box store of nearly double the retail floor space, six bowling alley-length aisles stocked with 4,070 varieties and sizes of wines and 1,744 of spirits, and five checkout lanes.

If that seems over the top, well, the state’s liquor czar said he’s simply doing what any good retailer would do and meeting consumer demand.

“It’s a great market that’s been underutilized,” said Joseph Mollica, chairman of the state Liquor Commission and former Sunapee restaurateur who has championed the state’s aggressive expansion of its liquor retailing operation since he was named head of the agency in 2010. “We’ve seen some great growth in Lebanon.”

The Liquor Commission estimates the new West Lebanon outlet will generate $16 million in annual sales compared with nearly $14 million the old store generated in recent years. That would catapult West Lebanon from the 11th-ranked to the eighth-ranked store in the state, on par with the Liquor and Wine Outlets in Bedford and South Hooksett.

A traffic study when plans for the store were unveiled in late 2017 said the new outlet will generate 159 vehicle trips during the weekday peak hour in the afternoon and 167 trips (87 entering, 80 exiting) during the Saturday midday peak hour.

It’s also likely to be a key destination given its proximity to the interchange of Interstates 89 and 91. Nonresidents are an important source of revenue — the agency says some 50% to 55% of its sales come from out-of-state customers, attracted by New Hampshire’s lack of a sales or sin tax.

Although the new store is only a half-mile from the former store, the new location is critically among the cluster of other box stores along the south extension of Route 12A, such as Walmart, Best Buy, BJ’s Wholesale Club, Home Depot and Price Chopper. That should lead to higher customer traffic, according to Mollica, despite the new liquor store and its parking lot being set back from Route 12A and behind other buildings.

“We’re with like-minded retailers, and that’s what’s important,” Mollica said. “The (access) road is fixed and finished. We’re very comfortable with being set back from the main traffic,” he said, in reference to the pond-size potholes in the private entry road that would flood with water runoff after a rain. While most of the area has been repaved, a dip remains in the spur leading toward the Walmart plaza.

Although the new liquor store itself architecturally is plain and functional, there is nothing proletarian about some of wines and spirits on its shelves. Along with the usual Cutler Creek “white zinfandel” wine for $3.79 a bottle and fifths of Gilbey’s Vodka Traveler on sale for $4.99 that can be had in any liquor store, oenophiles and whiskey connoisseurs can also find — behind glass cabinet doors — a 2015 Chateau Cheval Blanc for $992.99 and a 28-year aged Laphroaig single-malt whiskey for $799.99.

(But — sorry, old chap — if you’re looking for that 50-year old Glen Grant single-malt at $13,999, you’ll have to drive to the Salem outlet in the Rockingham Mall to get the only bottle available in the state.)

On Thursday, a couple hours after doors opened at 9 a.m., the parking lot was already packed with cars, and customers were leaving the store with their purchases.

Mike Pierce, the former owner of Mike’s Store & Deli in Hartland who sold his business a couple years ago to Jake’s Market & Deli and now oversees the wine and beer operation for the Upper Valley convenience store chain, emerged with two cartloads of cases of wine headed to the shelves for retail sales at Jake’s stores (wine retailers must purchase their wine through the state’s distribution system).

“I love it,” Pierce said. “It’s so much bigger than before. It’s the first time I’ve been able to get everything on my list.”

Neighboring businesses located on the south end of Route 12A are also hoping for a bump in business from customers on their liquor runs.

“We’re hoping it’s positive for business, especially people in Vermont saying, ‘Oh, I didn’t know you were here,’ ” said Rob Geddes, district manager at the Weathervane restaurant, which is only a few feet away from liquor outlet. “The place looks a lot nicer. I’d been looking out at a parking lot.”

Brad Nelson, who acquired the Brown Furniture store on Interchange Drive in West Lebanon last year, said the thousands of customers a month visiting the new outlet are “not going to hurt.”

“If nothing else the increased traffic will be more visibility for us,” said Nelson, who also had hoped there could have been a “cut” from Interchange Drive past his furniture store, which is next to the Valley News building, to connect with the liquor store. “That would be the gold standard,” he said.

The Liquor Commission’s aggressive retail expansion drive — the agency has opened 32 new and renovated Liquor & Outlets since 2012, 42% of the stores in its system — has been challenged by some members of the New Hampshire Executive Council, who have questioned the wisdom of investing capital in brick-and-mortar stores in an era when e-commerce is taking hold.

Mollica announced in 2016 that the Liquor Commission had entered into an agreement with a Canadian tech company to build a “state-of-the-art” online sales platform, but the system has yet to debut and the only way for consumers to purchase hard alcohol in New Hampshire is to visit a store. Among the seven states in the country that allow spirits to be sold only through state-operated retail stores, only Pennsylvania currently sells online and ships for home delivery.

“It’s something we’ve been looking at for the past five or six years,” Mollica said last week. “We’re in the process of putting it in place,” adding that it is “premature to put a time stamp on it” but adding it would be “in the near future.”

After several years of down to flat wine and spirit sales, the Powerhouse Plaza store recorded sales rose 2.5% to $14.2 million for the fiscal year that ended on June 30.

That brought liquor sales in West Lebanon back up to their 2016 level after slipping to $13.8 million, according to the liquor commission’s annual report.

The New Hampshire Liquor Commission reported that fiscal year 2018 total net sales — revenue after discounts and card fees are subtracted — totaled $692 million, up 7% from $648 million in 2017, according to the agency’s 2018 Comprehensive Annual Financial Report.

As big as those numbers appear — they make the state government of New Hampshire among the largest point-of-sale retailers in the state along with other household name chain stores — the important figures are how much wine and spirit sales contribute to the state’s general fund, from which the government draws to pay for most of its operations and services other than education and highways.

The state of New Hampshire counts on liquor sales to help fund state government. About 6% of revenue in the general fund comes from money transfers from wine and liquor sales. In recent years those transfers have been steadily falling, from $154.6 million in fiscal year 2016 to $131.3 million for the most recent fiscal year, even though total sales reported by the Liquor Commission have increased from $682.4 million to $723 million over the same period.

In the face of criticism that the aggressive bricks-and-mortar upgrade program has not led to higher profits despite greater revenue, Mollica has emphasized the importance of “brand building” and capturing market share in order to maintain dominance.

“Our sales in the last eight to nine years are up $192 million,” he said. “For years there wasn’t a commitment to invest in the brand. That’s a commitment we’ve made the last 10 years and the Legislature has made the last 10 years. That’s something that should be ongoing. You’re never in a position where you stop doing that. You don’t want to get behind the eight ball.”

Customers, however, are probably less concerned about the economics and politics around the Liquor Commission than they are with the convenience and variety of wines and spirits found on Outlet shelves.

On Thursday morning Katherine Savery, of Brookfield, Vt., was walking out of the store with a bottle of Bärenjäger Honey Liqueur and two bottles of premixed Jose Cuervo Golden Margaritas.

“I can’t get this in Vermont,” Savery said of the Bärenjäger​​​​​. “I have to come across the river to get it.”

She called the new store “a beautiful facility” and liked that there is ample parking unlike the “congestion” at Powerhouse Plaza.

“One thing New Hampshire does well is booze,” she said.

John Lippman can be reached at jlippman@vnews.com.




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