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The Advisor - Issue #29

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CEO s Note Lots to celebrate for the liquor industry Page 3 Boston Liquor License Sticker Shock Independence Day is a time to celebrate connect and reflect Summer brings ebbs and flows for business owners depending on where you are located Page 5 Customer Service Customer Habits For Retailers Page 7 Summer Travel Impact On Business Take some time to enjoy the celebrations with your loved ones and the people you are working so hard for Make sure to lean on us as your resource when needed Page 10 Summer Sippin Popular RTDs Sincerely DAN NEWCOMB Founder CEO Liquor License Advisor Liquor License Advisor has been a trusted resource in the liquor store and license industry since 2002 THE ADVISOR MAGAZINE 2 www LiquorLicenseAdvisor com

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Boston Liquor License Sticker Shock by Dan Newcomb The newly established View Boston s restaurant and lounge just paid 600 000 for their full liquor license a price tag that has turned some heads It seems that the price of full liquor licenses in Boston is currently at an all time high with the city s restaurant and bar scene looking much different post pandemic as many establishments closed their doors However many new restaurants and bars have begun to open their doors although who exactly is able to open these doors is resulting in some controversy Many restauranteurs owners and operators are experiencing some sticker shock when it comes to the price of a full liquor license not to mention the higher cost of pretty much everything associated with conducting business these days Some Boston neighborhoods insist that they cannot afford the steep price tag associated with a Boston liquor license and supply and demand are off kilter as the demand is currently much higher than the supply All of this may make you wonder if it s a good time to sell to buy or if the city will intervene Recent articles published in The Boston Globe and Eater Boston highlight the record breaking price of the View Boston s liquor license as well as other recent purchases not far behind the 600 000 figure The June 26th Boston Globe article introduces Palmer Matthews a restauranteur who put his plans to open a restaurant on the back burner when he and his partners discovered that a full liquor license would cost 500 000 The article also cites another example of a steep price tag with the new One Congress tower restaurant and lounge space costing 575 000 for their full license Although Matthews and his partners situation is familiar it may hit harder post pandemic as many went out of business and are attempting to reestablish themselves The article comments that big landlords and deeppocketed restaurateurs are increasingly the only ones who can stomach the high cost of doing business in Boston That s shutting out smaller players with more modest resources Lesley Delaney Hawkins chair of the restaurant and hospitality practice group at Price Lobel law firm stated that It is a bidding war for these licenses right now The positive is that people want to still come in and invest in Boston the negative is the concern of pricing people out of the market With all the recent openings in Boston it appears that some do have the finances to invest in liquor licenses and to rekindle the Boston restaurant scene THE ADVISOR MAGAZINE 3 Continued on next page www LiquorLicenseAdvisor com

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Boston Liquor License Sticker Shock Continued by Dan Newcomb The issue for some is that these licenses are so steeply priced that they cannot afford a license and worry that they won t make the money back on their investment Eater Boston presents the argument that these types of prices drive young talent away and block many smaller independent restauranteurs from opening in the city The home rule petition which proposes to add 250 new licenses to ten Boston neighborhoods that have struggled to pay these prices is a recent bill filed with the support of Mayor Michelle Wu and the Boston City Council However it will be at least until next year before any next steps are taken The Eater Boston article published the very next day after The Boston Globe article comments that It s not a secret that Boston s much maligned liquor license cap which in turn makes existing licenses prohibitively expensive to acquire has largely stopped all but the richest operators from being able to sell cocktails within city limits But it is still shocking to hear how bad the situation has gotten The article then goes on to cite The Boston Globe article and the 600 000 price tag for View Boston s license Clearly the high price is receiving high exposure The record high price of 600 000 the home rule petition s proposed licenses and the ability for some to open restaurants while others are not may leave owners and operators wondering what the best plan is We ve been talking about supply issues in the Boston restaurant liquor license market for over a year now How long will it be until the City of Boston steps in and makes changes What will that mean for existing owners If you have questions about your license we can be a resource for you and help you navigate these tumultuous times for you We re here for you THE ADVISOR MAGAZINE 4 www LiquorLicenseAdvisor com

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Customer Service Consumer Habits For Retailers Premiumization Levels Off in the Face of Inflation by Michelle Hansford A recent BevAlc Insights by Drizly report comments on the premiumization trend that surfaced during the pandemic referring to when consumers were trading up to higher priced products across the beverage alcohol spectrum a trend that lasted well into the past year As nights at home became standard during the pandemic many upgraded their typical selections at the liquor store or online ordering platform to treat themselves Some even found themselves with more disposable income than before the pandemic as many stopped spending money on commuting eating and drinking out and engaging in other social activities Add on government assistance and cancelled travel plans consumers had a little extra cash and splurging on nights at home became the new norm for many Fast forward to 2023 Americans are enjoying the freedom of post pandemic life but inflation and the higher cost of just about everything are hitting hard which means that it s highly likely that consumers will be trading in their premium brands for lower cost options It is imperative that retailers track trends and purchase wisely to make the most of continued premiumization in the strongest beverage categories according to the Drizly article Because although premiumization continues it is doing so less rapidly Let s take a look at the numbers The 2023 Drizly Consumer Report suggests inflation and recent spikes in the cost of living could be behind the slowdown Sixty six percent of survey respondents reported changing their alcohol buying behaviors during the past 12 months due to inflation Seventeen percent reported buying cheaper brands than they normally purchase and 12 percent said they have switched to less expensive beverage categories DISCUS economist Hasan Bakir comments that consumers are prioritizing the essentials like paying for rent and groceries so they are less likely to splurge on higher end alcohol products Continued on next page THE ADVISOR MAGAZINE 5

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C U S T O M E R S E R V I C E & C O N S U M E R H A B I T S F O RR E T A I L E R S C O N T I N U E DSo, what are owners and operators to do? According to Liz Paquette, the head of consumerinsights at Drizly, “it is important that retailers considerthe trend’s impact within specific subcategories, asthey do not always mirror the overall alcohol categorytrend. While we are seeing shifting trends across theboard, there are specific brands and products thatconsumers are still willing to splurge for”. “As premiumization levels off, it’s more important thanever to focus on customer acquisition,” according toDrizly. Christian Miller, proprietor of Full GlassResearch, adds that, “Whether it’s advertising, socialmedia, word of mouth, events, promotions, or whatever– especially among more affluent consumers – andretention.” In other words, it is essential that retailers keep aclose eye on spending habits and on their customerservice, just as consumers are keeping a close eye ontheir budgets. THE ADVISOR MAGAZINE  | 6

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SUMMER TRAVEL IMPACT ON BUSINESS Some Key Takeaways On How to Make the Most of Summer Travelers BY MICHELLE HANSFORD With summer now in full swing many restaurant and liquor store owners are faced with the same question what will this season look like for my business Will people hop on a plane or into their cars to seek adventure far away from home or will the rising costs of fuel food and nearly everything in between cause people to stay closer to home Recent travel reports reveal that while many remain enthusiastic about traveling this summer embracing a pandemic free season travel plans may look a little different this year due to continuing inflation concerns Restaurants and liquor stores like most other businesses are also faced with the consequences of inflation and if you are a business owner you know that keeping your hand on the pulse of who your customers will be this summer and how long they will be staying has never been more important The Vacationer just released a report on Fourth of July travel plans including average number of how many Americans plan to travel and what their travel plans entail THE ADVISOR MAGAZINE 7 This summer holiday typically calls for trips to the closest liquor store for refreshing options to enjoy on the beach at a barbeque or on the back porch as well as vacation days tacked on before and after the holiday including many meals enjoyed out at local restaurants The report found that more than 60 of American adults intend to travel this Independence Day more than 155 million people according to the latest census However travel doesn t necessarily mean two weeks at a beachfront rental The 60 24 includes the 22 62 that will travel for a relative or friend s party the 17 04 that will go on vacation the 14 69 that are planning a day trip and the 5 88 that will travel for a different reason The 17 04 that will travel purely for vacation during this time represents nearly 44 million American adults We can see how the 155 million number drastically drops when considering how many people will actually go on vacation not just a day trip or an overnight which means that business owners must capture customers the best they can ensuring that their restaurant or store is the most appealing option to those vacationing for shorter amounts of time Continued on next page

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SUMMER TRAVEL IMPACT ON BUSINESS CONTINUED In addition to how long people plan to travel it is also important to note who will be travelling Deloitte just released their summer travel report which states that the following age groups will take at least one trip this summer Gen Z 45 Millennials 64 Gen X 72 and Boomers 65 with Gen Z most likely to take to the beach this summer and Boomers most likely to hit the city The Vacationer report shows that of those asked if they would travel this Fourth of July holiday 27 52 said yes but they are sticking close to home within 100 miles Nearly 60 of Americans will attend a barbeque over the fourth of July weekend making it prime time for liquor stores to be ready The Deloitte report ensures us that Americans will travel this summer despite inflation concerns as Americans are finding room in their budgets for the adventure discovery and relaxation that travel can provide Whether they are making up for lost time spending down savings or placing high value on experiences and memory making Americans continue to find reasons to prioritize travel Similar to The Vacationer findings the Deloitte report echoes financial concerns finding that the majority of those not planning travel state that it s not in their budget It also appears that those who are planning to travel are mostly planning shorter trips like long weekends quick getaways 68 and shorter trips not exceeding a week 64 Only 14 are planning extended trips of two weeks or more which would provide ample time to sample many local restaurants to peruse different store options and time to travel to various locations Deloitte reports that marque trips will be shorter this year as prolonged inflation is likely weighing on travel spending decisions and that dining at a restaurant is the number one activity experience that travelers will participate in when they do travel with 75 saying that they will So again if people are traveling but for shorter amounts of time it is imperative to ensure that your business is their top choice Not only will people travel for pleasure business trips are back in business and according to a June 16 2023 CGA report Business trips rank as the second most popular reason for expected monthly visitation to hotels in the next 12 months topped only by visits to bars and restaurants This renewed appetite for business trips has seen the rise of the bleisure traveler business travelers who are combining their business trips with an extended vacation with almost 3 in 5 business travelers combining their business trips with an extended vacation Continued on next page THE ADVISOR MAGAZINE 8

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Summer Travel Impact On Business Continued For brands this represents massive engagement potential if they can focus on alignment with both portions of bleisure visits and leverage the needs of each element To do so brands need to understand what motivates business travelers who are combining their trip with a vacation It appears that business travelers are prolonging their trips both solo as well as bringing along a spouse combining business with pleasure and making the most of some travel expenses being accounted for Again these types of travelers have limited time dedicated solely to indulge while extending their business trip so it s essential that hotel restaurants bars and neighboring establishments take advantage of this slim opportunity Sources are confident that the summer of 2023 will involve travel for Americans although the duration and destination may be impacted by inflation Restaurant and liquor store owners should plan accordingly Curious if it s a good time to sell your liquor store Give us a confidential call 617 648 5558 THE ADVISOR MAGAZINE 9 www LiquorLicenseAdvisor com

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SUMMER SIPPIN POPULAR RTDs BY MICHELLE HANSFORD A recent BevAlc Insights by Drizly report reveals that in the past 12 months Drizly has seen over 400 new RTD cocktail SKUs stock keeping units added to their catalog Clearly growth in this category is not slowing down any time soon Local businesses should take note because By location Boston Northern New Jersey Long Island New York Nashville and Providence Rhode Island all overindexed on RTD sales on Drizly in that 12 month time period What s more is that RTD options shouldn t only concern liquor store owners According to a June 21 2023 CGA report their research shows that 17 of American drinkers who visit bars pubs and restaurants have consumed RTD alcohol in the past three months claiming that the On Premise sector serves as a critical avenue for adventurous consumers seeking to engage with the category So what are the Top 5 FastestGrowing RTD Cocktail Flavors on Drizly that both on and off premise establishments should consider 1 Tequila Soda Ranch Water The fastest growing SKUs in this category in 2023 to date compared to the same period in 2022 are the High Noon Tequila Seltzer Variety Pack Casa Azul Tequila Soda Variety Pack Cutwater Lime Ranch Water Talkhouse Encore Tequila Soda Blood Orange and Faux Pas Grapefruit Orange Tequila Soda 2 Flavored Margarita The fastest growing SKUs on Drizly in this category are Hornitos Ready to Drink Strawberry Tamarind Margarita 1800 Ultimate Strawberry Margarita Cutwater Pineapple Margarita Capriccio Take Out Cocktails Mango Passion Margarita and Bota Rita Margarita Wine Cocktail Strawberry 3 Espresso Martini The fastest growing Espresso Martini SKUs on Drizly also have a noted variation in the most popular can size and format On the Rocks Effen Vodka Espresso Martini which comes in a 375 milliliter bottle Tip Top Proper Cocktails Espresso Martini which comes in 100 milliliter cans and DELOCE Espresso Martini which comes in a 200 milliliter can 4 Flavored Vodka Soda The fastest growing flavored vodka SKUs on Drizly were JuneShine Spirits Passionfruit Vodka Soda TRULY Vodka Hard Seltzer Variety Pack White Claw Spirits Vodka Soda Variety Pack Talkhouse Encore Vodka Soda Cranberry and Faux Pas Lemon Mint Vodka Soda 5 Non Alcoholic In 2023 year to date Kin Euphorics a functional adaptogen wellness beverage from Jen Batchelor and Bella Hadid led the way with the two fastest growing SKUs the Kin Spritz lightly caffeinated ginger citrus and hibiscus and the Kin Bloom inspired by sparkling ros wine THE ADVISOR MAGAZINE 10

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CAPE CODWE'RE HERE FOR YOUSince the pandemic, a specificstore type and location have beenin high demand. Liquor storesdoing close to or over $1 million insales that are well-run and inprime locations include but are notlimited to:SOUTH SHOREMIDDLESEX COUNTYIN HIGHSTORE OWNERS:CONTACTUS NOWWe have a number of highlyqualified buyers looking for well-run stores in specific locations.Call/text:(617) 648 5558Email:team@llausa.comLIQUORSTORESWANTEDDEMANDIf this sounds like your store &/oryou've been considering sellingand want to know what youroptions are, it's time for aconfidential conversation.

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YOUR TRUSTED INDUSTRY PARTNERDid you know that for over 2 decades, our Founder, Dan Newcomb, hasbeen in the liquor license industry as the "go-to" for other industryprofessionals and leaders? Every phone call that comes into our office is about a liquor license. Wedon't work in any other industry besides liquor stores and licenses.We provide owners with a "firewall" to protect them from all of the pitfallswe know are out there throughout a transaction because we know how toprepare the deal and navigate the waters. We're here for you.Meet Our TeamDan NewcombCEO & FounderBen JerromBuyer SpecialistJennifer MedicoTransaction SpecialistGlenn LawlerSeller SpecialistMichelle HansfordSeller ConciergeSherri BeauchampMarketing SpecialistQuestions?Call 617.648.5558 orvisit: LiquorLicenseAdvisor.comKate NewcombProject Specialist

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References Boston Liquor License Sticker Shock Page 3 4 1 Who wins and who loses when a liquor license in Boston sells for 600 000 published on The Boston Globe dated June 26 2023 by Shirley Leung https www msn com en us news us who wins and who loses when a liquor licensein boston sells for 600 000 ar AA1d2f30 2 Top of the Hub Replacement Reportedly Paid a Whopping 600 000 for Its Liquor License published on The Boston Eatery dated June 27 2023 by Erika Adams https boston eater com 2023 6 27 23774226 view boston restaurant bar liquor license Customer Service Customer Habits For Retailers Page 5 6 1 What To Know About Beverage Alcohol Premiumization in 2023 published on BevAlc Insights https bevalcinsights com what to know about beverage alcohol premiumization in 2023 Summer Travel Impact On Business Page 7 9 1 The experience economy endures Deloitte Insights https www2 deloitte com content dam insights articles us176337_cic_summer travel DI_The experience economyendures pdf 2 Fourth of July Travel Survey Trends 2023 60 to Travel Nearly 64 Say Inflation Affecting Plans Nearly 55 to Road Trip Nearly 50 to Watch Fireworks by Eric Jones on June 23 2023 https thevacationer com fourth of july travelsurvey 2023 3 Emergence of the Bleisure Traveler as a Compelling Customer Segment by CGA Powered by NIQ https cgastrategy com emergence of the bleisure traveler Summer Sippin Popular RTDs Page 10 1 Insights from the Top 5 Fastest Growing RTD Cocktail Flavors on Drizly https bevalcinsights com insights from the top 5 fastest growing rtd cocktail flavors on drizly 2 Who is the American RTD drinker by CGA Insights https cgastrategy com who is the american rtd drinker Special Contributions Acknowledgements Features Editor Editorial Assistant Michelle Hansford Kate Newcomb Magazine Digital Editor Sherri Beauchamp Liquor License Advisor 2023 All Rights Reserved Unless Otherwise Noted THE ADVISOR MAGAZINE 13

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THE ADVISOR MAGAZINE BY LIQUOR LICENSE ADVISOR The Advisor Magazine runs on a monthly basis to keep stakeholders in the liquor store liquor license industry in the loop August 2023 Come back for Issue 30 which will reveal the current state of the industry how industry trends are coming in for summer and more Liquor License Advisor 10 Post Office Square Suite 800 South Boston MA 02109 617 648 5558 www LiquorLicenseAdvisor com