Delaware’s liquor stores are facing tough times. Adrien Olichon photo from Pexels.
This post has been updated.
Liquor stores that boomed during the pandemic, when so many Delawareans were sheltering at home, are now reporting declines in revenue.
“Everyone I’ve talked to is down” in revenue, said Edward Mulvihill, who networks a lot as president of the Delaware Small Beverage License Council and a board member of American Beverage Licensees. He’s also the fourth-generation owner of Peco’s Liquors in North Wilmington.
“That’s more alarming because we know costs have gone up,” he said.
Bill Galbraith, owner of Tim’s Liquors in Hockessin and the Wine & Spirit Co. of Greenville, crunched some revenue numbers for DelawareLive.
Sales at Tim’s in the first 3½ months of 2024 are down 5% from the same period in 2023, he said, and those sales are down 10% from 2022.
“Everything costs more, but less is coming in,” he said. “I’m definitely having problems. Ours is a slow death, and I hope it revives.”
Owner Bill Galbraith said sales at Tim’s Liquors in Hockessin fell in 2023. And they fell even more in 2022 at the liquor store. Courtesy of Bill Galbraith.
Mulvihill brought up the sorry state of package stores in an April 23 House committee hearing on Senate Bill 166, which will allow Delawareans to have home delivery of wine, beer and mixed cocktails from restaurants, brewpubs and taverns.
That law, if passed, would offer another reason not to patronize liquor stores, he said.
During the lockdown, the state Legislature changed Delaware’s laws to allow customers to take out alcohol with food, a key measure designed to keep the state’s restaurants afloat in the early part of the economy-roiling pandemic.
“The rocket fuel that was the pandemic has burned out, and all of those trends have gone back to far more realistic growth (or decline) rates,” said Marten Lodewijks, an executive with IWSR, which analyzes the industry.
A 2023 IWSR report predicts steady declines for beer and wine.
“The spirits industry held its market share edge over beer and wine for the second straight year in 2023,” CNBC reported.
“U.S. spirits revenue grew only a modest 0.2% last year to $37.7 billion, according to the Distilled Spirits Council of the U.S.′ annual economic report. Although the industry gained little total revenue, it outpaced beer and wine sales by 0.4% and 26.1%, respectively.”
Delawar’’s “package store customers want the convenience of delivery, too,” said Edward Cooper, a spokesman for Total Wine, Delaware’s largest liquor retailer. “Package stores know this because their patrons have been asking them for delivery. MD and NJ both allow package stores to deliver to their customers (either by the retailer or third party delivery companies).”
N.K.S. Distributors, Delaware’s largest liquor wholesaler, did not respond to requests for comment.
“We’re just trying to figure out where the customers are going,” Mulvihill said, suggesting first that consumers are cutting back because of inflation. Or maybe they’re concerned about the health effects of alcohol. Or maybe they’re turning to newly legalized recreational marijuana.
Beyond liquor stores
Whatever the reason, the competition is intense in Delaware. The state has about 330 package stores, Mulvihill said, “one of the highest, if not the highest number of liquor stores per capita of any state.”
Over the last three fiscal years, the Delaware Alcoholic Beverage Control Commissioner has issued 305 new licenses in various categories and canceled only 58.
Delaware’s tourism office lists 25 breweries, four wineries, three distilleries and two meaderies, all created in the last four decades. Contrast that to Peco’s and Tim’s, which are both about nine decades old.
And now the restaurants, brewpubs and taverns who might be allowed to offer home delivery.
Mulvihill did note some bright spots, including ready-to-drink cocktails, tequila and box wine.
Sales of box wine are up 35% at Peco’s, comparing 2023 to 2022. Box wines provide great value, he said, citing a Bota box that works out to be about $5 for 750 milliliters.
However, he said that the silver lining of box wines comes with a cloud: They reduce foot traffic because customers need to replenish their liquor cabinet less often.
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