Idaho Liquor Newsletters

INDUSTRY NEWS

Idaho Liquor Sales Results

January sales finished up +0.6% vs. last year.  The month’s results were impacted by a favorable calendar effect, as this January had an additional Thursday/Friday vs. one less Monday/Tuesday.   This impacted Sales by approximately +$695K or +3.2%.  January results were actually down an adjusted -2.6% factoring out the calendar effect, which is a fair amount below the calendar year-to-date trend.   I think it’s safe to say that ‘Dry January’ is definitely a thing.  In real terms, this January is easily the poorest performing month in years.  Last January was down an adjusted -3.0%, so we’ve taken a sizable dip even cycling a soft month.  I can imagine the recent advisory from the Surgeon General contributed to softer sales this month, as well. 

Now for the good news: all of the softness occurred in the first two weeks of the month.  Halfway through January, Sales were down -4.5%.  In order to rally and finish the month down -2.6%, the last half of the month decreased only -0.7%.  From where I’m standing, it looks like ‘Dry January’ became ‘Damp January’ in the back half of the month.  This provides some optimism that February may return to the YTD trend.  Next month should be very interesting.  Apparently, ‘Wet February’ is a thing, too.  However, preliminary results indicate that February sales will finish down -1.2% vs. a year ago.  Looks like we’re going to have another month that is fairly soft relative to year-to-date trends.

Here’s a look at adjusted sales growth over the past 12 months:

The red trendline above does suggest some stability, but results have been anything but stable the last 6 months.  There’s an awful lot of volatility from month-to-month right now, as consumers can’t seem to decide how they feel about the various things that affect alcohol sales e.g., the economy, politics, lifestyle, New Year’s resolutions, etc. 

One of the more interesting statistics of the month is that bottle sales actually increased vs. last January, significantly belying year-to-date trends.  At the same time, the average bottle price for the month decreased.  You can probably guess what happened in January.  That’s right, all positivity in bottle sales came from small sizes, specifically 50MLs.  This is noteworthy because 50MLs had been trending negative all fiscal year heading into January.  Perhaps recent tweaks to how we display small sizes is having an impact. 

We’ve been hearing a lot lately about customers’ increased interest in small sizes, and that these smaller packages are an avenue for offsetting volume declines in larger sizes.  You’ll see in the box below that bottle sales have been declining over the past 12 months pretty much across the board.  Even single 50ml bottles have been declining.  However, the bundle packs (multi 50ml bottles) are definitely performing well, especially this fiscal year.  Note that the 200 ml (4x50ml) and the 500 ml (10x50ml) below represent bundle packs of 50ml bottles.

However, it’s important to bear in mind that although the 50ml bundle packs are performing well, they still represent a very small portion of our business.  Our bread and butter (i.e., 50, 375, 750, 1000, 1750) make up over 99% of our business, and that  92% of our topline sales are in the three largest sizes.  50ml bundle packs may be a growth opportunity, but they’re far from being a game changer.

As much as we discuss the state of the industry and declines in consumption, it’s important to keep some perspective.  Have a look at this:

The ISLD’s highest-ever year for sales was in FY23.  Through seven months of the fiscal year, we’re currently on a pace to exceed FY23.  The population is drinking less but still spending about the same amount on liquor as they have in the past.