Despite the COVID-19 pandemic hitting pause on its retail operations as well as shutting down many of its largest customers, the Pennsylvania Liquor Control Board is reporting that it had a fairly good fiscal year.
“We were actually on the path to set a new record for the fiscal year. We even had a bonus sales day on Leap Day in February, but then COVID hit and required us to pause our operations,” said Shawn Kelly, PLCB spokesman.
Sales were down slightly in Fiscal 2019-2020 from the previous fiscal year, but income was actually up because of the implementation of operating efficiencies and retirement and post-employment costs, according to Kelly.
Net sales for the fiscal year were $2.39 billion as compared to $2.127 billion in fiscal 2018-2019.
Net income, however was $208.71 million for 2019-2020, up from $191.04 million in 2018-2019.
Of course the shutdown during the pandemic did significantly impact operations as well as how and what they were selling.
The biggest factor was the quick shift to an e-commerce platform when COVID-19 led the PLCB to stop in-store sales.
“We had to significantly boost our ecommerce capabilities in a short time,” he said.
That meant creating 120 e-commerce fulfilment centers across the state, many in converted retail stores.
“We really needed a big IT lift. There’s a lot involved in turning a retail store into an e-commerce center,” he said.
Not only did the technology need to be created, quickly, logistics issues such as which stores had which products became a pressing issue as well as the need for different equipment and packaging stock.
While the PLCB’s website started off with limited accessibility with the initial demand greatly outpacing the agency’s ability to convert its systems, Kelly said once the kinks were worked out, e-commerce became a dramatically larger portion of sales.
“Before COVID people mostly used the site to get specialty and harder to find items,” Kelley said.
With the e-commerce demand switched to daily needs, he said those sales jumped from $5 million in 2018-2019 to $27 million for the 2019-2020 fiscal year, with much of that at the peak of the shutdown in the spring.
It also changed what type of alcohol people were buying online from high-end whiskey to more common products, like vodka.
Overall spirits sales to PLCB licensees were hurt by the temporary shutdown of the state’s bars and restaurants, and continued limited capacity.
Wine, however, was stronger because outlets such as grocery stores, which remained open during state’s retail shut down, were still able to keep wine sales going.
Kelly said the PLCB was able to meet its $185.1 million obligation to the state’s general fund.
In all, it provided $894.8 million in funds to state and local government.