With consumers ever mindful of their wallets these days, beer retailers are seeing a customer shift toward larger packaging sizes like 12-pack and 24-pack cases from consumers who are searching for added value. But keeping large packs cold can be a challenge for many store operators who have limited cooler space. To combat this, some retailers are finding that beer caves are a worthy solution.
“Not only does our cave keep more beer chilled for us, but it’s also led to a big increase in our beer sales,” says Conner Fiedler, assistant manager at the six-unit Ken’s Super Fair Foods grocery chain in South Dakota, whose Aberdeen location features a 20-foot by 30-foot beer cave. Added four years ago, the cave, fitted with six reach-in doors for singles and 6-packs, stocks up to 4,000 cases of beer.
Retailers with beer caves tout their benefits. Along with the ability to offer more cold beer and a wider variety, the equipment helps ensure that stores are selling quality products. “Many craft brewers today don’t recommend that their beer be kept at room temperature,” explains Tom Slattery, owner of JJ’s Wine, Spirits & Cigars in Sioux Falls, South Dakota. JJ’s 2,300-square-foot cave with 11 reach-in doors demonstrates to its craft brewer partners that the store respects their products, he says. Slattery and Fiedler agree that since not all stores offer the feature, the walk-in coolers also give their operations a competitive advantage.
Elise Maddox, the manager of Agfinity Cenex, a convenience store in Mead, Colorado, says the cave added to her store last year—which stocks a few hundred cases of beer—has received a warm response from customers. “I don’t know if we’re necessarily selling more beer but it does cut down on our stocking costs and manpower,” she notes. “And it allows us to have a little backstock, which, as a c-store with limited space, is important.”
Indeed, c-stores appear to be driving today’s momentum for caves, according to Joe VanderHaar, CEO and founding partner of iSee Innovations, which designs and manufactures retail merchandising solutions, including items for beer caves and coolers. “C-stores are more of a destination for cold beer versus grocery and liquor stores,” he explains, so those operators place a big emphasis on cold storage. About 20% of all c-stores feature beer caves, Vander Haar estimates, while for groceries and liquor stores the figure is likely a lot lower. “The c-store industry believes in the returns on investment from beer caves,” he says.
Of course, beer caves require a commitment to capital expenditures for retailers, including initial installation, maintenance, and power costs, but there are other considerations too. Maddox points to occasional product loss. “Sometimes customers will knock over bottles and you don’t know until you walk in,” she explains. “I’ve also found open containers in there.”
Effectively merchandising the beer cave is critical to its success. Most important, perhaps, is communicating to customers that the store features a cave, whether it’s through in-store or outdoor signage, or social media. The placement of ancillary items in the cave—ranging from bottled water to energy drinks to soft drinks to wine and canned cocktails, where legal—can tack on dollars to a sale.
Brewers advise that retailers should put the same thought into merchandising their beer caves as they do the rest of the store. “Keep it shopable, clean, and communicate that you have a cave where customers can find large pack sizes,” says Marc Venegoni, vice president of sales at Rhinegeist Brewery. Ohio’s Great Lakes Brewing CEO Chris Brown agrees. “If you have the space for it, beer caves are effective sales drivers,” he says. “Cold beer sells faster than room-temperature beer.”