Grand Manan store faces loss of NB Liquor franchise among top performers last year
The NB Liquor franchise store in Grand Manan posted an increase in sales for the 10th consecutive year, new figures confirm it. This raises questions about the decision the Crown corporation made to move what has been one of its most successful franchises to a new location.
“We had a good year, like a very good year,” said Faye Guptill, owner of Castalia Convenience outlet.
” Everything was fine. Why move it? »
Faye and her husband Roger have had the retail franchise to sell liquor in Grand Manan from their country store on Route 776 since NB Liquor closed its own outlet on the island at the end of 2011.
According to figures recently released in NB Liquor’s annual report, retail sales in Grand Manan hit a new record high of $2.245 million for the fiscal year ended April 3, 2022.
This is a 3.4% increase over the previous year and places the store among NB Liquor’s top franchisees. NB Liquor’s overall sales rose 2.8 per cent, according to its annual report, but most of its individual agency stores in New Brunswick, 65 out of 88, suffered a drop in sales during the year.
Agency stores retain as little as seven percent commission on what they sell for NB Liquor, but franchises are popular for the goodwill they generate.
The Guptills say they have worked hard to grow their business, adding extra shelf space and coolers over the years.
NB Liquor’s own records seem to confirm this and show that the Grand Manan outlet has been one of the leaders in sales growth over the past decade.
Sales increased by 70%
Since its first full year as a designated NB Liquor retailer in fiscal year 2013, figures show liquor sales at Castalia Convenience have increased by 70.6%. This is more than double the 34% increase in NB Liquor’s total company-wide sales from all sources over the same period.
Still, the Guptills were told in August that NB Liquor will move the Grand Manan franchise about two miles up the road to the local Loblaw grocery store and Irving Oil outlet starting in January.
The Guptills were nearing the end of their contract period this year and expected to be offered a renewal, but a decision was made by NB Liquor to put the franchise out to tender. Faye Guptill said an NB Liquor representative told her she did well on the 100-point scoring system used to assess submissions received, but not as well as the neighboring Loblaw franchise.
Guptill said she is still waiting to receive details on that score to decide if there is room to fight the decision.
“I haven’t got my score back yet. I’ll have to go through it and see,” Guptill said. “They said I got a very high score so I have to see where I went wrong. But I mean, there’s not much I can do.”
NB Liquor is already embroiled in a legal dispute over its scoring system and the role it played in moving the franchise to Hartland in 2021 away from its longtime downtown location near the famous covered bridge.
The Hartland outlet is now at the Irving Oil station and the Valu Foods outlet on the outskirts of town. In its first full year, it saw liquor sales drop 2.5% to $1.898 million, according to new figures released by NB Liquor.
However, the decline is greater than it appears, since NB Liquor’s last fiscal year included 53 weeks, one more than the previous year. This puts Hartland’s average weekly sales in the new outlet about 4.4% below what they were downtown.
“I will win in the end”
Peter Cook of Hartland, who lost the NB Liquor franchise and is challenging the decision in court, believes the drop in sales at the new location helps prove his point that the move was not made for good business reasons.
“Believe me, I’m going to win in the end,” Cook said in an interview Monday.
Cook also believes the drop in sales at Hartland should be a warning to NB Liquor not to tamper with the growth the Guptills have overseen at Grand Manan.
“If a franchise is doing better year after year and its renewal is coming up, it should be renewed,” Cook said. “Why would they take it away from them?”
NB Liquor did not grant an interview, but in a statement, the opening of franchises to a public “request for proposals” in Hartland and Grand Manan was made as part of a process to “ensure the ‘fairness and consistency’.
“The timing of the bidding process has no relation to sales performance,” the statement said. “Experience is a factor, but there’s no reason to believe that another bidder who scores high on all criteria couldn’t achieve equally strong sales performance at the bid location.”