Of the $1 billion in revenues that Lancaster County supermarkets post a year, beer sales are just a drop in the bucket.
But grocery store operators think there’s a much bigger market in the county to tap.
For now, beer is sold at only three of the roughly 50 supermarkets here; all are Weis Markets stores.
That number is likely to more than double soon, though, in part because new players are joining the fray.
Weis is planning to add beer sales to two more local supermarkets. Giant and Darrenkamp’s plan to introduce it here too.
Other local grocers say they’re thinking about it.
“It’s a growing trend,” said Jeff Metzger, publisher of supermarket industry publications Food Trade News and Food World.
The rise of supermarket beer cafes shows that retailers think the extra revenue they’ll get from the cafes makes it worth enduring the regulatory hassle needed to open them.
“There’s growth in that category, and I think supermarkets are looking for category growth and ways to separate themselves from supermarket competition,” Metzger said.
“I don’t think of this as a home run, but it is an opportunity.”
Weis Markets, which opened the first Lancaster County beer cafe at its Lititz store in March 2014, later added them to its Ephrata and Fruitville Pike stores.
But Weis isn’t done.
Weis is making plans for a beer cafe at its store at Kendig Square in Willow Street. It hopes to open another here next year at a location it declined to specify.
“We’re full steam ahead,” said Dennis Curtin, a spokesman for the Sunbury-based chain, which has 13 stores in Lancaster County.
“Our in-store beer cafes have been extremely beneficial to our business for one simple reason: our customers like them, and they’ve embraced the concept of the convenience and variety we offer,” he said.
Other supermarket chains are getting in on the act.
Giant is planning what it calls a “beer garden and eatery” at its Lancaster Shopping Center supermarket.
Darrenkamp’s will seek permission this week from Rapho Township officials to sell beer at the cafe in its Mount Joy store.
Jeff Baughman, chief financial officer at Darrenkamp’s, said the grocery store is “testing the waters” with its pursuit of a liquor license.
Meanwhile, Wes Stahl, store manager for the Musser’s store at the Buck, the flagship of its four stores, said his company “certainly” will have at least one beer cafe within three years.
The concept is appealing for several reasons, he said.
Competition is stiffer than ever. Most Musser’s customers favor adding cafes. And its stores have room for them.
“It’s a tough world, especially for the independents that are left out there. We’re always looking for ways to keep our revenue streams up,” Stahl said.
Beer cafe regulations
While supermarkets are lining up to sell beer, technically it’s their restaurants that are doing the selling.
The distinction is crucial.
Current rules require supermarkets of up to 55,000 square feet to buy a state Liquor Control Board restaurant license, then set up a restaurant of at least 400 square feet with at least 30 seats. It must have its own cash register too.
There have been several legislative proposals to remove those requirements, including one from state Sen. David Argall (a Republican who represents Schuylkill and Berks counties).
Redner’s Warehouse Markets said it “would definitely look at the option” if proposed legislation to relax rules for supermarkets wanting to sell beer gets approved, said spokesman Eric B. White.
White said the Reading-based chain of 44 stores, including one in Ephrata, has no interest in opening beer cafes under the current rules.
“We don’t have the space, quite frankly. It would take away valuable sales space,” he said.
At the beer cafe
On a recent afternoon, the beer cafe at the Lititz Weis Markets was doing a steady business.
One customer was Chris King, a 28-year-old audio technician from Lititz.
King said that while it’s not ideal to have to pay for beer separately, as is required at beer cafes in Pennsylvania, it’s still simpler.
“It’s the price, and it’s just convenient,” King said.
Buying beer at the grocery store didn’t seem strange to Sue Francois, who went to Manheim Township High School but now lives in Tampa Bay, Florida.
“Our grocery stores in Florida all sell beer,” said Francois, a 53-year-old event planner who was back in the area for a high school reunion.
“Whether you buy it here or down the street, what does it matter?”
The Weis beer cafe has 32 seats where customers are allowed to drink up to two beers. Employees said that while some customers do drink there, it’s rare.
LeAnn Supeck, whose father owns Wheatland Distributors, said the whole grocery beer cafe setup irks her.
Supeck said she resents what she sees as supermarkets skirting the law by setting up faux restaurants just to sell beer.
“It’s a gross misuse of the licenses,” she said.
Supeck, who is secretary of The Malt Beverage Distributors Association of Pennsylvania, said the supermarket restaurants tilt the playing field.
Beer distributors need to make a profit selling beer. But supermarkets can use low beer prices to get people in the store to buy groceries.
“I don’t begrudge customers for picking up a six pack at a grocery store. It’s a convenience. I just wish we could also be convenient for them,” Supeck said.
Not for everyone
While the number of supermarket beer cafes in the county is growing, most supermarkets in the county don’t have them.
And the operators of several major supermarkets here made it clear that their stores will stay that way.
Shady Maple Farm Market in East Earl — the county’s biggest supermarket, at 150,000 square feet — has no interest in opening one.
“It’s not a good culture-and-values fit for us,” said Lin Weaver, a Shady Maple Inc. vice president and manager of the farm market.
But Weaver understands why some supermarkets are opting to open beer cafes.
“It’s a challenging time for all supermarkets. Margins are very tight. Everybody is looking at ways to grow revenue. (A beer cafe) is an option some people are choosing, and that’s fine,” he said.
Shady Maple, though, is trying to increase revenue by other means. It’s widening its selection of gourmet, locally grown and organic items, said Weaver.
Lititz-based Stauffers of Kissel Hill, with three stores in Lancaster County, likewise is steering clear of beer cafes.
“The owners of Stauffers of Kissel Hill made the decision many years ago that they will not sell tobacco products, alcohol or lottery tickets,” said spokeswoman Debi Drescher.
“We are not planning on making a change in our corporate direction regarding the sale of alcoholic products, regardless of the outcome of the recent discussions and proposed legislation on the privatization of the sale of alcohol,” she said.
Management at Yoder’s Country Market in New Holland, Ferguson & Hassler in Quarryville, Oregon Dairy on Oregon Pike and Martin’s Country Market in Ephrata likewise nixed the idea of beer cafes at their stores, saying the cafes would clash with their values.
Jim Eshleman, owner of John Herr’s Village Market in Millersville, said he won’t open a beer cafe at this time because most of his customers who’ve mentioned the cafes to him oppose the idea.
“I’m not saying down the road (it couldn’t happen),” Eshleman said.