Numerous grocery and convenience chains have greatly expanded their presence in the beverage alcohol space in recent years through enhanced in-store offerings, additional licenses, and in some cases, new freestanding liquor stores of their own.
“The traditional off-sale business has changed,” says Dustin Mitzel, CEO of Happy Harry’s Bottle Shops, which operates five stores in North Dakota. Mitzel points to the entry of new deep-pocketed licensees in his market as some of his biggest competition. He believes the grocers are attracted to the category’s relatively high margins as compared to other products they carry. Covid-19 also likely helped fuel the trend, he adds, as “consumers didn’t want to make a lot of stops. Groceries saw this and started to carry more inventory.”
Florida-based grocery giant Publix operates more than 350 standalone liquor stores, mostly in the Sunshine State. Publix Liquors stores are often located adjacent to a sibling grocery store, providing convenience for shoppers. Last year, Publix expanded into Kentucky, including the opening of a liquor store in Louisville that features more than 150 Bourbons. At least one more liquor store is planned for the area.
Winn-Dixie is another southeastern grocer with a chain of liquor stores, and similar to Publix, in Florida its beverage alcohol shops are usually located adjacent to a sister supermarket. In a unique example, in Apoka, Florida, a glass wall separates the two businesses, a feature designed to “increase customer awareness and drive traffic,” according to Dewayne Rabon, chief merchandising officer at Southeastern Grocers, the parent company of Winn-Dixie and Harvey’s supermarkets. A Belleview, Florida Winn-Dixie liquor store, meanwhile, offers drive-thru service.
Earlier this year, a consortium of private investors and C&S Wholesale Grocers acquired Southeastern Grocers (SEG) and its existing liquor store business from Aldi, which had purchased the operations in 2024. According to an SEG spokesperson, the company plans to reopen select liquor stores that previously closed as part of the Aldi conversion.
In an interesting development four years ago, Southeastern Grocers opened a free-standing liquor store in Jacksonville, Florida not adjacent to a supermarket, and with a distinctive identity. WD’s Wine, Beer & Spirits “provides a unique destination for customers to explore our extensive selection of more than 1,700 wines, 500 beer varieties, and 1,400 spirits,” says Rabon, who notes the store also features a beer cave, a cigar humidor, and a seating area for events. “The positive response to this concept has been overwhelming,” he adds.
Midwestern supermarket chains are also investing in freestanding liquor stores. With nearly 300 grocery stores in eight states and growing, Hy-Vee Inc. has long offered beer, wine, and spirits in its stores. But four years ago, the company launched a chain of stand-alone liquor stores under the Wall to Wall Wine & Spirits banner, with three locations in Nebraska, and one in its home state of Iowa.
Major c-store chains have also been leaning into beverage alcohol. Iowa-based Casey’s General Stores, with nearly 2,900 locations in 20 states, maintains that it’s the fourth-largest holder of liquor licenses in the country. Many Casey’s stores are located in rural midwestern markets, but late last year the c-store chain purchased Wow! Foodmart LLC and its retail portfolio, which includes four liquor stores in Kentucky.
Independent liquor store operators say the grocers’ efforts have ratcheted up competition. “I try to attract the Publix demographic,” says Barry Broudy, co-owner of Broudy’s Liquors in northeastern Florida. “When Publix opens near me with a liquor store, I feel it more than another independent opening a store. My customer count goes down.”
By all accounts, beverage alcohol expansion efforts by supermarket and c-store operators are expected to continue. “Liquor used to be something that some stores in a chain did,” says Broudy. “Now, it’s become an entire department for them.”
Southeastern Grocers’ Rabon doesn’t argue. “Looking ahead, we see immense potential for this category at Winn-Dixie,” the executive says. “Through exciting promotions and customer-focused innovations, we’re committed to solidifying our position as a premier destination for adult beverages.”
