Thursday, May 05, 2005

Long awaited follow-up

The retail liquor privatization meme is long dead, but now that I have photoshop and screen-capture utilities working, I thought I'd revisit it briefly.

Please direct your attention to the unauthorized use of Google Maps below. The 'M' up near the top right represents Chateau Fenwick. The multiple 'X' marks represent establishments of various sizes selling beer and liquor.

It's about 1200m from the top of this map to the bottom.

Delicious, convenient liquor Posted by Hello

Ever been driving home, realized, "Damn, I forgot to stop at the liquor store", and had to turn around? I haven't! And did I mention that you never, never wait in line?

Colby Cosh made another good point back when we were discussing this:
I don't buy enough booze to be super price-sensitive; the one change I have noticed is that certain items go on sale when the private retailers want to clear out stock, so there's absolutely no question that you can drink more cheaply if your shopping tastes are even slightly elastic.

Indeed. Even outside the context of stock rotation, some retailers appear to put the same markup on all their products; some obviously sell certain products at or near cost while adding big margins to others. Yet another advantage for the engaged consumer!

One other anecdote I think is barely interesting enough to share: like most products, you tend to receive a certain volume discount when buying beer (i.e. a two-four is cheaper than two "dozens", which is in turn cheaper than four six-packs; we tend to attribute this to economy of packaging).

This is also true of the prices paid by retailers to the government wholesaler, which led one of my local retailers to detect an opportunity. Take typical Kokanee can prices (includes tax & deposit):
  • 24 for $36.69
  • 12 for $18.89
  • 6 for $9.79
My favorite local guy picked up a six-pack holder-putter-onner somewhere. He doesn't buy flats containing 4 six-packs, only cubes. Then his staff rips apart cubes, makes six-packs, and sells them for $9.19.

A quick calculation will demonstrate that he takes a mere 7 cents per 24 for his trouble. It's his business, and if he's looking for market share, he's got most of my business. What you may also notice is that it's cheaper to buy two six-packs than a dozen, even though there's extra labour associated with the sixers.

I'm not a big shopper, but I'm pretty sure it's unusual to find retail instances where it's cheaper to buy two units of the same individual item than a two-pack of the same item. Party on.


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