Hard Seltzer C-Store Sales Up 190% in Q3

The latest Goldman Sachs retailer survey indicates continued meteoric rise in hard seltzer sales at convenience stores. Outlet sales were up 190% in the third quarter, compared to 2019, indicating further room to grow for the segment, as well as the continued reverberations of on-premise restrictions.

Retailers expect the channel to continue to benefit through the rest of 2020, according to the bank’s survey of retail and wholesale contacts representing 33,000 US convenience & gas store locations.

Goldman Sachs continues to monitor the reopening of the US, as businesses open, close, and open again. Their surveys help the industry measure the pace of reopening and the associated impact to various retail channels.

At-home Economy Booming

Bonnie Herzog, Managing Director at Goldman Sachs, commented “Overall, we think retailers increasingly view the hard seltzer category as a long-term beneficiary of the at-home economy, and this is likely to be a meaningful driver behind strong category growth through the remainder of 2020 and beyond.”

In a separate June 2020 survey conducted by Drizly, the alcohol E-commerce platform, more than half said they are drinking more at home, and a similar percentage said they will continue to do so.

There remains some skepticism among retailer about the ability of craft hard seltzer brands, or start-up brands, to have lasting penetration and compete with the likes of White Claw and Truly, the report noted.

Retailers were upbeat about news of pending large releases. Brands such as Monster, Coca-Cola, and Mike’s Hard Lemonade are planning hard seltzer releases in the US.

Out-of-Stocks Decreasing

As production increases, retailers are seeing improvements, Herzog said. The report noted that 70% of the survey respondents said that their out-of-stock alcohol issues have improved.

Only 10% of those surveyed said that out-of-stocks had worsened in the past month.

For the hard seltzer category, the news about out-of-stocks wasn’t quite as good. Approximately 50% of retailers had not seen improvement in their out-of-stock situation. But this can be interpreted as continued high consumer demand and a lagging capability of the supply chain to respond.

In fact, retailers often note that one of the biggest challenges is finding space to merchandise all the new brands of hard seltzer. In an exclusive interview with Hard Seltzer News, Sara Hillstrom, Sr Director of Category Development at Anheuser-Busch, said “They know their shoppers and their business better than anyone else. But, one thing I’m seeing — there are definitely strains on the cold vault in c-stores. There’s just not a lot of space, in general.”