Fresh on the heels of an acquisition by a broadly diversified parent company, California-based Save Mart Cos. has embarked on a remodeling program for a number of its grocery stores that includes plans to elevate and greatly expand its beverage alcohol offerings. Executives at the company—which calls itself the largest regional, full-service grocery chain in the Golden State—believe the upgrades will position Save Mart for long-term sustainable growth while continuing to provide its customers with the innovation and commitment to value that has been its hallmark for more than 70 years.

“We’re reducing unproductive sections and utilizing that space to enhance our product offerings throughout the store,” says Paul Gossett, group vice president of store operations at Save Mart Cos., of the “very aggressive merchandising of our stores.” One of the biggest beneficiaries of the reset, he notes, is the beverage alcohol department. “We’ve doubled the size of beer, wine, and spirits in the right stores,” says Gossett, a retail marketing and merchandising veteran who joined Save Mart Cos.—the operator of the Save Mart, Lucky California, and FoodMaxx chains—in 2022. Resets and remodelings at a number of Save Mart and Lucky stores are planned for this year.

Comprised today of a total of 194 stores in California and northern Nevada, Save Mart was founded in Modesto, California in 1952 by Nick Tocco and Mike Piccinini. Bob Piccinini, Mike’s son, took over leadership of the company in the early ’80s and led its expansion of stores in Modesto and surrounding Central Valley communities, as well as the launch of the FoodMaxx banner in 1986. In 2007, the company purchased 128 Albertson’s stores in northern California in a spin-off sale, and renamed them Lucky California, reprising the once-prominent San Francisco Bay-area grocery banner. Private-equity firm Kingswood Capital Management LP acquired Save Mart Cos. in 2022, and just last year, Canada’s Jim Pattison Group (JPG) took over the grocery firm. Details of the most recent acquisition weren’t released. Current revenue for Save Mart Cos. is undisclosed, but in 2018, it reported annual sales of $4.5 billion. In addition to retail operations, JPG has holdings in automotive and agricultural equipment, packaging, entertainment, advertising, and media, among other businesses.

Between the three concepts, store square footage ranges from 10,000 to 74,000 square feet, Gossett says—the largest being the warehouse-style Food Maxx stores—and averages 45,000 to 50,000 square feet. The Save Mart chain comprises 79 stores stretching from Tehachapi, northeast of Santa Barbara, to Chico in northern California. Lucky operates 61 stores in and around the San Francisco Bay area, and value-driven FoodMaxx now counts 54 locations throughout California and northern Nevada. “We have all the elements covered with our value banner, the Lucky banner on the coast, and the Central Valley with Save Mart,” Gossett says, noting that, as a result, the group has distinct customer bases. Lucky, for example, attracts a more upscale clientele than the other concepts. “We see higher wine and spirits sales at Lucky and more beer at Save Mart.”

Vision of the Future

Following the acquisition by JPG, the company embarked on its remodeling program, and at press time, three Save Mart stores had been refreshed, with an enhanced focus on beverage alcohol. “They represent our vision of the future,” says Gossett, pointing to fixtures like copper shelving, the installation of lock boxes for high-priced items, improved lighting, and expanded cold space. A Save Mart store in Modesto, California that reopened in January features more than 600 new wine, beer, and spirits offerings, including top-tier Bourbons and Tequilas; rare Scotch, rum, and Cognac; and a wine steward to assist shoppers.

Leading the beverage alcohol department is director of beer, wine, and spirits Frank Chandler. A beer distributor veteran, Chandler transitioned to retail five years ago, and in 2023 joined Save Mart, where he’s responsible for pricing, department layout, merchandising, and promotions at the three banners. Chandler is particularly proud of the remodelings and the opportunity they provide the company and its customers. “We stock more than 300 Bourbon selections, including single barrels like the Elijah Craig Select Barrel ($80 a 750-ml.), more than 250 Tequilas, and Bordeaux wine. We stock products that are not even available at BevMo,” he notes.

Save Mart is heartily promoting the enhancements. At the Modesto reopening, for example, roughly 300 limited-release Bourbons—which were priced from $35-$500 a 750-ml. and included Pappy Van Winkle 20-year-old Family Reserve and the W.L. Weller Collection—were made available for purchase to early arrivers.

Beverage alcohol is indeed an important category to Save Mart Cos. According to Gossett, with all but two of its stores offering beer, wine, and spirits, the category accounts for about 7% of total sales. In a typical store, beverage alcohol comprises about 10% of the square footage, or about two and a half aisles out of 19. Overall, beer accounts for half of the company’s beverage alcohol sales, with wine and spirits each at 25%. However, the breakdown varies by concept, with Lucky stores leaning more heavily on wine and spirits and Save Mart stores on beer. Still, selection varies by concept and store location. “It’s not a cookie-cutter set,” Chandler says.

Wide Product Selection

Save Mart Cos. stores stock about 260 beer SKUs. Imported brews such as Modelo Especial, Corona Extra, and Pacifico (each $29 a 24-case of 12-ounce cans) are top sellers, followed by 30-packs of domestic beers like Coors Light and Bud Light (both $23). Among craft brews, the trend today is toward “hyper local,” Chandler says, pointing to products like Hops of Wrath IPA ($20 a 12-pack of 12-ounce cans) from Dust Bowl Brewing in Turlock, California. Most recently, sales of non-alcoholic brews have been promising, “especially with legal-aged customers up to 25 years old,” Chandler notes, and the company has been building out its offerings. “It’s becoming a destination,” he says of the emerging category.

The stores offer about 800 wine SKUs, ranging from Fox Brook Cabernet Sauvignon (three 750-ml. bottles are $9 at FoodMaxx) to the 2010 Château Haut Brion ($1,400 at Save Mart and Lucky), with the sweet spot resting at $8-$13 a bottle. “Popular, mainstream wines drive our sales,” Chandler says, pointing to brands like Apothic red blend ($11), Bogle varietals ($11), Butter varietals ($19), and Kendall-Jackson Chardonnay ($13). “But we’re trying to graduate that up,” Gossett adds, which is one of the reasons for the new wine steward program. “We aim to trade up our customers from a Butter Chardonnay ($19) to Rombauer ($44).” In addition to upselling, the stewards will also help guide customers. “Our mission is to make it easy for the customer. With so many SKUs, they’ll help them match a wine to a meal,” Chandler says.

Up to 400 spirits SKUs are stocked at the stores, priced from $6 a 750-ml. for E&J Gallo vermouth to $5,500 for W.L. Weller Millenium. While Tito’s Handmade vodka ($33 a 1.75-liter) is the top-selling spirits brand, “growth is really coming from Bourbon and Tequila,” says Chandler, as well as RTDs. In fact, the stores recently reset their coolers with a delineation of all RTDs, including hard seltzers, FMBs, and canned cocktails, rather than intermixing the products, resulting in 20% growth for the category. “We moved all the High Noon and Cutwater products from the warm shelf,” Chandler explains. “Customers don’t want to buy those products warm.”

Showcasing Value

Just as aggressive as Save Mart Cos. is in promoting its beverage alcohol offerings, it’s also fiercely competitive when it comes to price promotions. A mix-and-match program, whereby customers earn 10% off any six bottles (750-ml. and larger) of wine and spirits purchased in one visit, is hugely popular. Digital coupons via the banners’ websites and apps have also received a strong response, Chandler says. “We partner with our suppliers to bring value to life,” he notes, pointing to recent digital coupons like $10 off Flowers wines and $5 off a pound of seafood when wine is purchased. Digital purchases are delivered via third parties.

Special events also promote the beverage alcohol offerings at Save Mart Cos. For the last several years, for example, Save Mart and Lucky have featured a “Women in Wine” series of tastings in March in select stores, with appearances from winemakers like Marcia Torres Forno from Matanzas Creek and Lauren Kopit from Sterling Vineyards. “These visits help bring their stories to life,” Chandler notes. And for 17 years now, the company has served as a sponsor of the California State Fair & Food Festival with its hosting of the Save Mart Wine Garden, where guests can sample from some 70 California wine varieties and a handful of wine slushies. The grocer is also a title sponsor in the annual Toyota/Save Mart 350 NASCAR series, held at Sonoma Raceway, which provides it with exclusive beverage alcohol tie-ins.

Save Mart Cos. plans to keep the momentum for its expanding beverage alcohol department and support for those products going. “While other retailers are pulling back, we’re investing forward,” says Chandler. “We see a big opportunity for growth in beverage alcohol.”