BOSTON —Alcohol retailers are concerned about supply chain issues but are still optimistic for the holiday season and 2022, according to a new report from alcohol e-commerce and on-demand delivery platform Drizly. They’re also ready to stock more tequila and see big potential for cannabis-infused products.
The findings come from Drizly’s third annual BevAlc Insights by Drizly Retail Report, which in November surveyed more than 500 retailers nationwide. The report combines survey results and sales data from the Drizly platform in 2021.
Click through to see some of Drizly’s key findings …
Ongoing shortfalls in aluminum, glass and other alcohol beverage inputs are expected to continue into 2022, concerning many retailers.
More than half of retailers surveyed (54%) said product shortages/supply chain issues was the biggest challenge they anticipate facing in 2022. Twenty-two percent said product price increases was the biggest challenge they anticipate facing, followed by labor shortages (20%), local or state regulations (2%) and other (2%).
Despite supply concerns, retailers are optimistic about sales for the 2021 holiday season. More than 70% of retailers surveyed said they expect sales will be higher than a typical holiday season or about the same.
Nearly 80% of retailers plan to carry more tequila next year, on par with bourbon. Less than 40% said they would stock more vodka.
It mirrors trends on Drizly, the Boston-based company said, where over the past few years tequila’s share of spirit sales has grown by 13% while vodka’s share has declined by 2%.
Most retailers said they seek to stock locally made products, followed closely by organic and natural products when asked about what special attributes in a beverage matter most. Celebrity-owned alcohol brands followed closely behind.
Hard seltzer’s slowing growth could mean more retailers are making space for craft beers and ready-to-drink (RTD) cocktails, Drizly found.
Retailers who responded to the survey plan to devote the most incremental shelf space to RTD cocktails in 2022. Sixty percent said they expect to devote more shelf space to RTD while 57% said they expect to devote more shelf space to craft beer.
“And when asked which of those three categories was earmarked for less shelf space, hard seltzer was cited most often (by 23% of retailers), while craft beer got the biggest vote of confidence, cited by only 8% of respondents for planning to stock less in 2022,” Drizly said.
When retailers were asked which emerging category has the highest growth potential in the industry, more than half said cannabidiol (CBD)- or cannabis-infused beverages. Non-alcohol products was the second most-picked answer at 26%.
“Among factors influencing these attitudes may be the growing ranks of states that are legalizing recreational cannabis. Meanwhile, retailers are increasingly embracing nonalcohol beverage alternatives as well, which ranked second among products with the greatest growth potential (26%),” Drizly said in the report.
Ninety percent of retailers on the Drizly platform now carry nonalcohol beer, wine and other alternatives. The shares of nonalcohol products on Drizly have increased by 120% since 2020.
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