Bourbon Street: A Big Gamble Pays Off in NJ

Bourbon Street Wine and Spirits, a northwest New Jersey chain with nine locations, began 26 years ago out of a common frustration.

Brother and sister Cofounders Michael Wade and Cheverly Wade-Richardson were in their mid-20s when Michael passed the bar exam in New Jersey and New York. However, finding legal work was difficult. He considered other options.

A liquor store in their hometown of Califon — a rural town with a current population of around 1,000 — claimed to stay open until 9 p.m. One night, Michael arrived at the business, but found the door locked before closing time. Staff inside would not let him enter, despite his requests.

Frustrated, Michael learned that a liquor license was available for a 2,000-square foot space across the street. He told his sister that they should buy that license to run a better beverage alcohol retail business.

“And that’s what we did,” recalls Cheverly. “I was a manager at The Gap when Michael asked me to go into business with him. He was 26 years old. I was 28, with two kids. He lived at home with our parents. I lived in a trailer.”

The siblings took inspiration from their entrepreneurial parents, who were both in business.

First order at the newly opened liquor store: stay open an hour later than the competition across the street. Despite a closing time of 10 p.m., however, the realities of rural economics soon sunk in.

“We realized that we needed everyone in town to show up twice a day to make our store viable,” Michael says. “We knew we needed to grow elsewhere, where there were more people.”

Bourbon Street Wine and Spirits is a northwest New Jersey chain with nine locations.

Evolution and Expansion

It was a gamble for the siblings, going into debt to buy a business in which they had little to no experience. Thankfully, the ‘90s proved a fortunate period to reimagine a beverage alcohol retail store.

“It’s hard to achieve anything in business without a little bit of luck,” Michael says. “Most liquor stores in the ‘90s were smaller, and run by an old guy smoking a cigar behind the counter. Many of them still sold pornography.”

Industry change was imminent. A fine wine movement in America was about to usher in a completely different style of beverage alcohol retailer. One defined by premium products, clean interiors and exceptional customer service.

“From the beginning, our stores were always clean and family friendly,” Cheverly says. “A mom or dad could walk in with their kids and feel comfortable. We always had lollipops out for the kids.”

“In this way, we ended up being part of the new school of liquor stores by accident,” her brother adds. “The cleanliness factor alone separated us.”

As the pair contemplated expansion, they never considered owning more than two locations. But they remembered the lesson from their competitor across the street: Protect your territory.

In researching licenses for sale in more populous areas of New Jersey, the co-owners discovered another license available in their own town. Before a larger competitor could move in, Michael and Cheverly went deeper into debt to purchase this “pocket license.”

They did not stop there. Acquiring another license in a bigger zip code took the duo from one to three licenses within the first six months.

“We realized it was the right move. We realized we could make it work by tightening our belts,” Michael says. “We knew in the long run that it was the right thing to do. That’s how licenses four and five came about. We said, ‘Let’s keep more people out of our market. Let’s have homefield advantage in a certain area’.”

That homefield comprises a stretch of Northwestern New Jersey, largely along I-78. Many towns in this area are rural, but also among the wealthiest in the state. Moreover, I-78 is a direct route to Manhattan, only an hour and a half away.

A number of Bourbon Street locations also operate near the Pennsylvania border. Residents of the neighboring state who may not like the control model regularly cross over to shop in the private businesses.

Altogether, the result is a customer base sometimes on the smaller side, but with plenty of purchasing power and curiosity.

“As fine wine got going here, people wanted to learn more,” Michael says. “As craft beer got exciting, it became all about that. Any new trend that came along, we may get it a little slower here than elsewhere in the country, but we went all in. We knew we had to be ahead of the curve for our customers, because that’s what they wanted.”

“From day one, we knew we had to have things that were cool,” his sister adds. “Even if they don’t always sell, customers like looking at that kind of stuff. They want to point at it and say that they’ve drunk it, or their friend has. And when the time comes that they need that high-end bottle, they know where to find it.”

Accordingly, their stores commonly carry unique items.

“My sister, who does most of our buying, has always had the mantra of, ‘If we don’t have it in the store, then we can’t sell it’,” Michael says.

Refining the Model

Visit several Bourbon Street locations (as this writer did while lost in New Jersey this summer) and you’ll see stores designed identically, repeating what works.

For instance: Five of the sites have adjacent restaurants with a BYOB policy. This is by design. Michael and Cheverly are the restaurants’ landlords.

“From day one, we had the foresight to be our own landlords,” Michael says. “We saw so many people working very hard just to pay their landlords. We decided to tighten our belts even more and keep pushing things off by buying and building the properties ourselves.”

“This way, when we built buildings, we could build pretty buildings,” Cheverly says. “We could make sure that the buildings were attractive looking so that people felt comfortable coming into them. We made sure that they all had good, easy parking.”

And the pair could maximize efficiencies with restaurants next door.

“It’s the perfect synergy, a BYOB restaurant,” Michael says. “Now, customers can buy a $30 or $40 wine and bring it next door to have a nice dinner. That’s so much better than spending $100 or $150 for that wine at a restaurant with a liquor license. And that adds $100,000 in additional sales to each store attached, annually.”

“Seriously, who wants to pay $20 for a Grey Goose martini? It’s so silly,” he adds. “BYOB makes it so much easier. And if Cheverly and I feel this way, then it means that the customers feel that way, too.”

He and his sister aim for the same layout at every store. Half of the sales floor is set aside for wine. In the middle is liquor, followed by beer along the far-right wall. This setup has worked well for Bourbon Street.

“When you go to a chain store like Walmart, you typically know how it’ll be laid out, no matter where you are,” Michael says. “We wanted the same for ours. And we figured, if we wanted to grow with new locations, we wanted to do what already worked in our other stores.”

“We didn’t know what we were doing in the beginning, but we figured it out,” he continues. “We made mistakes along the way, but no huge mistakes. We did a lot of things right, whether by accident or not.”

Staff training is also similar throughout the chain.

“You have to be friendly with a smile,” Michael says. “If you don’t know something when asked by a customer, you say, ‘But let me find someone who can help you’. Someone might be new to the store, but they always have to be friendly with a smile.”

Michael and Cheverly routinely send employees to industry tastings, including Manhattan events.

“Skurnik Wines just had a tasting, and we sent a bunch of people,” Michael says. “Our key wine people went along with some of our younger people who have a passion to learn.”

“We try to make sure that there’s a wine, beer and spirits person at each store,” he adds. “It’s incumbent upon those people to pass their passion and knowledge onto other people, so that customer questions in the area don’t just fall upon the specialist. That makes for a better shopping experience for our customers.”

As for making a better working environment, Michael and Cheverly believe fostering camaraderie and positive attitudes begins with themselves.

“We both had a lot of jobs before we started this business, and we took a little from each job, each of our past bosses and how we liked to be treated there as an employee ourselves,” Michael says. “That’s how we try to treat the employees. We don’t tell employees what to do. We always try to explain why we need that stack moved from here to there.”

“We would never ask an employee to do something that we wouldn’t do ourselves,” Cheverly says. “I remember when we had just bought a new store, Michael was so disgusted with the bathroom floor that he got down and cleaned it himself. He said, ‘It’s too disgusting to ask anyone else to do it. That falls on us’. And we will still clean bathrooms now, if necessary.”

Current Trends

With so many stores and years of experience behind them, what do these veteran beverage alcohol retailers see as key industry trends nowadays?

“Hard seltzers came out of nowhere and swept the market,” Cheverly observes.

Is this a trend? Or will hard seltzer ultimately mirror the rise-and-plunge pattern of hard soda or cider? “The huge number of [hard seltzers] that are out there now, they won’t all stay,” Cheverly says. “But the drinkers will say which ones are the winners, and those will stick around.

What’s behind this boom? “It’s easy drinking,” Cheverly says. “Covid made it even easier. People didn’t want help from staff anymore in liquor stores during the pandemic. People just wanted to come in and out, with something easy and comfortable.”

Michael points to the lower calories in most hard seltzers.

“A lot of people want healthier drinking options,” he says. “Many of these hard seltzers are only 100 calories. That’s the same as a light beer.”

The impact upon other SKUs has been noticeable.

“Hard seltzer has taken from all other categories,” Cheverly says. “Wine, beer, whiskey — hard seltzer has eaten into them all.”

“It hit every other category more than any other product I have ever seen,” Michael adds. “It helps that the demo is everyone from age 21 and up.”

Elsewhere, tequila remains trendy.

“Tequila definitely has a lot of growth right now,” Michael says. “A lot of the times, it’s in the better bottles.”

“Again, like with hard seltzer, everyone is buying tequila right now,” his sister adds. “And like my brother said, it’s the high-end tequilas that are selling the best. All kinds of people are walking in and buying $150 tequilas.”

American whiskey, especially bourbon, is another category continuing to enjoy growth. As with retailers across the country, Bourbon Street has tapped into this trend by offering consumers a plethora of store pick single barrels.

It’s all part of the job for the well-seasoned cofounders: Recognizing what consumers want, while making sure that the stores stock a variety of popular, unique products, backed by friendly, helpful employees.

“We love what we do and couldn’t do it without the support of the staff who do it with us,” Cheverly says.

Her brother agrees, adding that their retail passion remains as strong as ever.

“We’ve been in business for 26 years and we’ve done our best to grow every year,” Michael says. “The challenges are different for us today — so different from when we only had one store. But we still have the same passion for growth. It used to be that we just wanted one more customer that day. Now, we just want one more store. A different scenario, but that same feeling.”

Kyle Swartz is editor of Beverage Dynamics. Reach him at [email protected] Read his recent piece, The Alcohol Brands Driving Meaningful Change in DEI.The post Bourbon Street: A Big Gamble Pays Off in NJ first appeared on Beverage Dynamics.
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Author: Kyle Swartz