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Companies in this industry sell beer, wine, and liquor products from physical retail establishments. No major companies dominate; in the US, individual states have different laws regulating liquor stores, complicating the ability to form national chains.
Europe has the highest proportion of drinkers and the highest levels of alcohol consumption per person in the world, according to a study by RAND Europe. Off-premise alcohol consumption is increasing at the expense of on-premise drinking there. Prices on off-premise alcohol are considerably lower than on-premise prices with retailers, especially supermarkets, able to purchase large quantities of alcohol at lower prices through volume discounts. Price differentials between countries -- alcohol sold in France is significantly cheaper than alcohol sold in the UK -- encourage cross-border shopping.
The US beer, wine, and liquor store industry includes about 33,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $50 billion.
Personal income, consumer tastes, and entertainment trends drive demand. The profitability of individual companies depends on effective marketing and competitive pricing. Large companies offer wide selections and deep discounts, but small companies compete by offering specialized merchandise, providing superior customer service, or serving a local market. The US industry is highly fragmented: the top 50 companies account for about 25% of sales.
Liquor stores compete directly with grocery stores, warehouse clubs, convenience stores, and some drugstores, and indirectly with restaurants, bars, ...
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