Total Wine opening in Roseville brings low prices, nervous competition
- Blog Post by: John Ewoldt
- March 13, 2014 - 4:27 PM
With one false start, the price war on Twin Cities liquor prices has begun. Total Wine
opened its 102nd store in Roseville today with prices and selection not found at any other local beverage retailer, said co-founder Robert Trone.
Back in December, Total Wine was supposed to open its 100th store in Bloomington next to Trader Joe’s, but the Minnesota Licensed Beverage Association convinced the Bloomington City Council that more study was needed before a license should be granted. Total Wine decided to re-trench and return to the Bloomington City Council in April with all its ducks in a row. When it will eventually open is still unclear, Co-owner Robert Trone described the MLBA's objections as unprecedented in the last 15 years at Total Wine.
Trone's brother and fellow owner David described the actions as driven by competitors trying to protect profits. He described margins as high as 50 percent in Minnesota whereas in other states it's closer to 25 to 35 percent. Total Wine's margins range from 6 to 25 percent, according to Robert Trone.
Various customers shopping on Thursday's grand opening day agreed that prices were lower than they're used to seeing elsewhere. One of the Twin Cities' low priced leaders, Liquor Boy in St. Louis Park, was several cents to several dollars higher on most items listed in both newspaper ads. For example, Dewars Scotch (1.75 liter) is $26.49 at TW and $27.99 at LB. On Mark West Pinot Noir, however, Liquor Boy's price of $5.99 beats Total Wine's $6.47.
Liquor Boy owner John Wolf said he won't react to Total Wine's prices. "They get you in the door with low prices on the national brands and then steer you toward higher-margin private labels," he said.
Both stores will match competitors' prices with the original ad, although they don't advertise it.
Total Wine doesn't expect to convert neighborhood liquor store shoppers, according to Total Wine spokesman Ed Cooper. "We're a destination for shoppers who come here six to 12 times per year," he said. But Total Wine's advantage, Robert Trone said, is a higher spending amount. Consumers spend about $15 to $20 on average in a visit to a tradtional liquor store while TW's haul per visit is about $70.
While the Bloomington store opening is still in limbo, Burnsville will be the next location to open in a long-vacant space in Burnhaven Mall. No liquor license has been granted yet, so don't plan on drinking wine before it's time, but Robert Trone expects an early fall opening.
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