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Wells wants to move the city liquor store

Council working at erasing losses

November 18, 2018
Katie Mullaly - Register Staff Writer (kmullaly@faribaultcountyregister.com) , Faribault County Register

Though their numbers may not be topping the liquor store charts, Wells is working diligently to get their municipal liquor store to bring in more money.

Their current liquor store, located on Broadway Street, is now just serving off-sale liquor. Up until recently, it was both on and off sale.

The city made the decision to close the on-sale bar portion to the VFW, who, in turn, added a brand new kitchen to the previous on-sale liquor site. According to the VFW, they are doing very well and serve food from 11 a.m.-10 p.m. daily.

Article Photos

The storefront of the current Wells Municipal Liquor store.

"The City leases the space to them at a rate of $600 per month," says Wells city administrator, CJ Holl. "The City gave them a year without rent to get the business established and they just started paying a lease as of October of this year. That will be an additional $7,200 in revenue we haven't had before, so that will help our bottom line going forward."

Holl also shares that previously, in 2016, the Wells Liquor store was approximately $36,000 in the hole.

"It has performed better since it went to strictly off-sale, but there is work to do," he says. "We are looking at a new location and the council approved us working with an architect, Oleson &?Hobbie of Mankato, to develop a preliminary plan and estimate for a new liquor store."

Holl says it is clear the city either needs to re-do where they are or look at an updated location, with limited growth possibilities in downtown Wells.

"The traffic count is about four times less than what they are out on the highway," says Holl. "That's 1,750 cars per day versus approximately 7,000 cars for the junction of Highway 22 and Highway 109."

The city met with the architectural team last week to look at elevation plans and prices. Wells will then be looking, financially, to see if their plans work based on the sales they may expect from the liquor store.

Holl says he and liquor store manager Scott Berg went to Hawley, Minn. earlier this past summer to visit with former Minnesota Municipal Beverage Association (MMBA)?president, Michael Friesen, who helps stores with operations, marketing, and profitability.

"Hawley is a very similar town of 2,000, east of Moorhead," says Holl. "They were in a lackluster downtown location doing $400,000. They moved to a highway location temporarily as they were having a new building built. Sales jumped to $700,000 and now, in their new building, are making sales of about $1.3 million. Scott has also visited other liquor stores around the area to get an idea of what they have been doing he has visited Slayton and Marshall."

The city also acquired a fairly new 30-foot-by-14-foot complete beer cooler from Sleepy Eye this past summer. Sleepy Eye closed their municipal liquor store, which went into private hands. The city's new cooler is twice the size of their current cooler.

"We have it in storage now and have built it into the plans for a new store," says Holl. "If used, we will save significantly from buying a new one. If we don't do anything, it has the same compressors and condensers we currently have, so we can use those to replace the coolers we have now."

Holl says the city is not sitting still and are actively planning improvements to their facility and, ultimately, their bottom line.

At the Wells City Council meeting on Nov. 13, Holl updated the council on the progress of the potential new liquor store. He also stated the liquor store has a brand-new neon sign in hopes of attracting more customers.

"We have met with our architect and gone over preliminary plans," Holl told the council. "We will bring those preliminary plans to the next meeting so you can take a look. Our first phase is to see what it could look like, and figure out our financial modeling. The liquor store has to be self-supporting."

For now, the city of Wells continues to look into solutions to bump up their liquor store sales, and their plan to improve their situation will move forward.

 
 

 

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