Complementary products — mixers, cheeses, glassware, snacks, anything else nonalcoholic — may not make up a great deal of your floor space. Likely they comprise around 3-5% of your retail footprint. Nevertheless, these products fulfill an important role in your overall store strategy.
“When we opened in 1987, we pioneered the concept of including gourmet food items in a fine wine shop, and it has been core to our strategy ever since,” says Mike Fisch, director of innovation of Gary’s Wine & Marketplace, in New Jersey and Napa Valley. “We believe that fine wines should be paired with delicious provisions, and therefore we carry a wide range of cheeses, charcuterie, crackers, jams, chocolates and other gourmet items. These gourmet food items are the perfect compliments for the wines we carry.”
“We also carry a variety of giftware items (cheese boards, barware, etc.) that our guests enjoy,” Fisch adds. “From a business perspective, gourmet food items and giftware tend to have higher gross profit margin than the alcoholic beverages we carry. Accordingly, if we can have guests add gourmet foods and gifts to their baskets, it significantly bolsters our profit.”
It makes sense for customers to grab these items at your store while already shopping for related alcoholic beverages.
“At Surdyk’s we are all about the experience, from shopping to the continued experience at home,” says Melissa Surdyk, owner of Surdyk’s Liquor & Cheese Shop in Minneapolis. “When it comes to complementary items, we focus on all of the details and ingredients needed to make the perfect beverage experience, from tools, glassware, mixers, cocktail ice, cigars and food pairings from our connected cheese shop.”
As with the alcoholic products in your store, the ongoing premiumization trend has reached into complementary items.
In Delaware, Peco’s Liquor Store has leaned into these higher-end items in fending off increased competition from grocery stores.
“We’re a boutique store, so we maintain high standards for what soft drinks and tonics we sell,” explains Edward Mulvihill, president, Peco’s. As grocery stores in the state began carrying more alcohol options during the past decade, “we knew we were going to lose out on sales of the national brands. So we made sure to position ourselves as a specialty store with specialty products, and that includes craft mixers, etcetera.”
“We have more product selection and more product knowledge than the grocery stores,” he continues. “Building out that craft mixer section early on was very important for us in the fight against grocery sales.”
As the store adapted with the changing grocery laws, “we sell a whole lot less soda now than we used to,” Mulvihill observes. “But that’s by design. We see those soda sales and put them into something else. And it’s worked out pretty well.”
“Local” and “craft,” two huge trends helping drive consumer interest in top-shelf alcohol SKUs, have those same guests now reaching up for complementary products.
“We are seeing a strong interest in U.S. and locally based cheese, charcuterie and gourmet items,” says Paul Gatzke, gourmet foods manager at the Madison, NJ-location of Gary’s Wine & Marketplace. “No longer is Europe the unrivaled master of fine cheese and gourmet foods. The U.S. producers’ artfulness, attention to tradition and quality are world class. As seasoned professional cheese mongers, our clients rely on us to search out and promote the new and upcoming cheese and gourmet producers in our own backyard.”
“We are seeing a strong interest in U.S. and locally based cheese, charcuterie and gourmet items,” says Paul Gatzke, gourmet foods manager at the Madison, NJ-location of Gary’s Wine & Marketplace.
Stocking these higher-end items is a critical point of differentiation for beverage alcohol retailers.
“We must keep our clientele engaged. As a high-end purveyor, we must present a higher standard of quality and selection, as to set us apart from a vast amount of competition,” Gatzke says. “As with wines and spirit, our cheese and gourmet selections need to be curated to the highest standard to keep our clients coming back time and again.”
Premiumization is also present in hardware.
Moreno’s Liquors in Chicago has had success with high-end bottle holders shaped like a G.I. Joe holding a bazooka, or a dog drinking a bottle.
“People like to put those on their backbars,” says Mike Moreno, co-owner. “Complementary products are a small but important category. People come into our store wanting convenience, the same reason they go into grocery stores and buy liquor there. They come in here for liquor and then also grab that hot sauce they need for their pizza, or the G.I. Joe bottle holder for their bar space. It’s a very important category.”
Macadoodles in Missouri has also sold a lot of similar, higher-end items.
“Some of these items are silly expensive, but people buy them,” says Ernie Olsen, growth and customer engagement at Macadoodles. “One that I like is a $25 high-end, universal koozie called Frost Buddy. It works with 12-oz. cans, slim cans and 16-oz. cans. It’s an all-in-one unit, stainless steel, and floats if you drop it in the river. It keeps beers cold for 24 hours.”
“You’ve also got to have less-expensive items, of course,” he adds. “For instance, we sell koozies that range in price from $40 to $1.50. In the wine area we sell expensive electric corkscrews all the way down to simple corkscrews. Same with wine aerators: simple to expensive.”
In Missouri, Macadoodles is a tourist destination for many consumers. “People are looking for neat stuff for themselves or for gifts,” Olsen says. “People come in looking for what kind of gadgets we have.”
These can be as simple as coasters.
“There are more and more coasters with clever sayings on them,” Olsen observes. “Same with shot and wine glasses. One shot glass last year said, ‘Nurses need shots too!’ These are clever, and with the internet, now you can stock any items from anywhere on the planet. The possibilities with complementary products are expansive.”
At Happy Harry’s Bottle Shop in Fargo, ND, CEO Dustin Mitzel looks to his customers for advice on what he should stock.
“We trust the consumers who ask for products,” Mitzel explains. “We want to make sure that our complementary products sections are fresh and fun so that customers don’t go to other stores. We’re constantly second-guessing ourselves. We look at our selection all the time to make sure they’re not going stale.”
“We’re looking into what’s trending,” he adds. “We’re always trying to find new products for our stores. We recently brought in a whole new line of shakers, glassware and bar tools.”
Other Notable Trends
Happy Harry’s has also increased its selection of nonalcoholic drinks.
“That has really increased for us,” Mitzel says, “especially nonalcoholic beers and premium mixers. Products like Seedlip — which make great mocktails — we’re seeing that whole category really take off.”
“We’re currently doing promotions of all things nonalcoholic,” he adds. “We redid all those sections in all our stores. We doubled the size of those sections. We always try to be early on these kind of trends so that people come in and say, ‘Oh, they have a really great selection of that here’ and we were first to market with it.”
Complementary product sales at Happy Harry’s are up 12% from last year, Miztel says, pointing to the increased popularity of many of these trendy items.
Elsewhere, alcohol trends that came about before and during the pandemic have extended throughout the store.
“Nonalcoholic offerings have drastically increased, and are selling well with increased interest in the segment,” says Surdyk of Surdyk’s Liquor & Cheese Shop. “Mixology at home has also increased, guests are seeking all elements to the perfect cocktail.”
Peco’s has also noticed an uptick in nonalcoholic sales.
“These products are more and more unique, with more local, craft nonalcoholic products,” says Mulvihill. “And you see more partnerships between brands. More brands partnering with great products like Fever Tree. There’s a lot of opportunity there as more brands find each other and create the synergy needed to grow together.”
Elsewhere, Spec’s in Texas has seen a rise in interest for beer garnishes. “Rimmers, beer salts,” says Peter Gryska, Spec’s food buyer. “Those have really exploded in the past six months. They enhance the flavor of beers, and that’s what people are after: things that can help enhance their experience.”
Like most stores, Spec’s stocks these products in applicable areas. “Bloody margarita mix in the margarita aisle, michelada mix in the beer aisle,” Gryska says. “We make it easy for people to put cocktails together. When thinking about these products, we always try to look at them through the lens of a liquor bottle.”
Drinking games have proven popular during the pandemic at Spec’s. “Particularly around the holidays,” Gryska says. “People like entertaining themselves and others.”
Complementary products are also another area where beverage alcohol retail stores can adapt and pivot quickly for additional sales. As the Covid crisis settled into America, Macadoodles began stocking different items that customers might need to help navigate the pandemic.
“We sell test kits,” says Olsen at Macadoodles. “We did sell Macadoodles masks and disinfectant. We sold out of that disinfectant when this crisis first started.”
The Future of Complementary
As craft, nonalcoholic, premiumization and other current drinking trends continue to proliferate through complementary products, look for this section of the store to remain important and profitable. And look for savvy stores to extend the trend of private label and store picks into these items.
“We intend to continue to expand this category given its positive impact on our bottom line. We also hope to begin creating more branded gourmet food items, such as Gary’s Olive Oil, Gary’s Spices, etc., as it will help us in our mission to bring high-quality items to guests at great prices,” says Fisch.
Gary’s is far from alone in expanding into private label complementary products.
“We sell mezcal cups, handmade just for us, with our logo on the bottom,” says Moreno of Moreno’s Liquors, known for its world-class selection of tequila and mezcal. “We sell those next to the exotic salts people like to buy for their mezcals: grasshopper salts, worm salts. Those do very well for me. The high-end salts sell the very best.”
Kyle Swartz is editor of Beverage Dynamics. Reach him at [email protected] or on Twitter @kswartzz. Read his recent piece, 11 American Whiskey Trends in 2022.The post The Top Trends in Complementary and Nonalcoholic Products first appeared on Beverage Dynamics.
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Author: Kyle Swartz