Rising liquor sales make the New Hampshire-Vermont border a booze battleground


Valley News Business Writer

Published: 06-07-2021 6:21 PM

In July, a new 10,300-square-foot New Hampshire Liquor & Wine Outlet will open in the Claremont Marketplace plaza on Washington Street, nearly doubling the space of its former store.

Not everyone is raising a glass to toast the occasion.

“That’s going to hurt,” said Rice Yordy, owner of Windsor Wine & Spirits in Windsor.

Yordy, who has been in business 15 years but lost several months of sales last year when a water leak at his busy Main Street location forced him to relocate to the other side of the railroad tracks on Depot Avenue, said a bigger New Hampshire liquor store 12 miles away will likely have an impact.

“A lot of people come in here, check the prices and then drive to Claremont,” he said.

Although Yordy has longtime loyal customers and has even picked up a few since a liquor store near the White River Junction VA Medical Center closed several years ago, he doesn’t relish the prospect of a shiny, new giant store across the river where people can buy “a bottle of vodka $5 cheaper.”

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Still, spirits are nonetheless uplifting the coffers of both states.

Although the 15-month COVID-19 pandemic has wiped out many retail businesses, wine and liquor sales are about to post record revenue in both New Hampshire and Vermont, according to liquor control officials. With many bars and restaurants closed, more people have been stocking up to drink at home.

Retail alcohol sales comparisons between New Hampshire and Vermont are difficult because each state accounts for sales differently — New Hampshire includes wine sales but Vermont does not, among other factors. It also complicates calculations that the Granite State has more than twice the population of Vermont, and its tax-free status draws an untold number of customers over its southern border with Massachusetts.

In New Hampshire, liquor and wine sales, with less than a month to go before the fiscal year ends June 30, have so far increased 3.6%, according to the New Hampshire Liquor Commission. Last fiscal year sales totaled $765.6 million.

In Vermont, liquor sales at the state’s contracted stores have increased 6.5% through May 31, according to the Vermont Department of Liquor and Lottery. Last year’s sales totaled $87.9 million.

New Hampshire’s state-run retail empire, which has renovated or relocated 34 of its 69 New Hampshire Liquor & Wine Outlets since 2012, dwarfs that of the Green Mountain State, which sells spirits through a network of 77 privately owned stores.

The Upper Valley has been at the center of the New Hampshire Liquor Commission’s expansion plans, relocating and building new stores in high-trafficked spots easily accessible from the Vermont side of the river.

Only last month, a new 6,300-square-foot New Hampshire liquor outlet opened in the New London Shopping Center, replacing the old store located below a Hannaford supermarket. That followed the opening in 2019 of a 19,000-square-foot outlet in West Lebanon that is now one of the highest-grossing stores in the state.

The new Claremont store, which is scheduled to open next month, will stock 3,600 wines and spirits, about 62% of the inventory carried in its larger West Lebanon counterpart but far outstripping what’s available in any single store across the river in Vermont.

The threat a New Hampshire store poses to liquor businesses across the river was evident one afternoon last week in West Lebanon, when easily half the cars pulling into the parking lot sported green Vermont plates.

“Pretty simple. Price,” said Bruce Miller, of Jeffersonville, Vt., when asked why he shopped at the West Lebanon store while he was loading a case of Captain Morgan Original Spiced Rum into his truck. The six half-gallon bottles cost him a total of $132, $22 apiece, compared with the $216, or $36 per bottle, he’d expect to pay in Vermont.

Miller, an HVAC contractor, said he makes a habit of swinging by the West Lebanon store whenever he has a job in the Upper Valley — and not only for himself.

“Friends are always saying, ‘Hey, Bruce, if you’re going to be in West Leb would you pick me up something?’ ” Miller said. “I don’t know if I’d drive all the way from Jefferson, but I’m here every week.”

Bill Hyde, a retired Ohio county superintendent who now lives in Woodstock, said a local shop in Woodstock sells a good selection of wines but he keeps an eye peeled for specials at the New Hampshire outlet. Like Miller, Hyde said he usually “piggybacks” a trip to the West Lebanon store when he has an appointment at Dartmouth-Hitchcock Medical Center or another reason to shop along the Route 12A box store corridor.

Parking lot license plate surveys aside, sales data from Vermont indicate that it is still unclear whether the New Hampshire liquor store expansions are having an impact on Windsor County stores.

Although there were still about eight weeks to go before the end of fiscal year, as of May 10, Windsor County retail liquor store sales totaled $5.4 million, compared with $6 million for the full 2020 fiscal year, according to state figures.

While a $600,000 gap may seem a tall order, Windsor County’s weekly average sales over the 2021 fiscal year would put it on pace to not just close that gap by the end of June but surpass it, roughly matching the rest of the state with a 6.5% total sales increase over fiscal year 2020.

So even if New Hampshire is targeting Vermonters with bigger and bigger stores at the border, the impact isn’t necessarily showing up in regional sales numbers.

Wendy Knight, deputy commissioner, liquor control, for the state of Vermont, acknowledged that New Hampshire’s outlet stores — which don’t charge sales tax and have a huge advantage in leveraging wholesale prices with distributors — are strategically located in border communities and could be drawing customers away from Vermont.

But she said the two states approach liquor control differently.

Whereas New Hampshire manages liquor and wine sales as a state enterprise whose principal objective is to fund state programs, Vermont’s aim is to promote the independent store owners who are embedded in the community.

“We are supporting local businesses,” she said.

Skip Vallee, owner of the Vermont-based Maplefields chain of convenience stores, said he has observed how taxes affect the retail sector and he doesn’t doubt they can influence consumers’ purchasing behavior.

Vallee, who last year acquired the Sharon Trading Post, which is a Vermont state branded 802 Spirits outlet, said because the Sharon store is the only Maplefields in the chain that sells liquor he has “no basis for comparison with border locations versus others.”

Nonetheless, ”I can say we are significant beneficiaries of the delta in gas tax with two New Hampshire (convenience store) and gas locations” in Lebanon and Littleton, Vallee said via email. “It is amazing the number of green license plates we see at these locations.”

On the other hand, he, said, Vermont does at least have an edge — over Canada.

“Before COVID, a huge part of the northern Vermont business was Canadians filling up and stocking up before entering Canada,” Vallee said. “Many used to come to the state just to fill up pre-9/11 border scrutiny.”

Contact John Lippman at jlippman@vnews.com.]]>