Friday, December 4, 2015

American Tap Liquors

Looks as if the LAB voted not to support the proposed American Tap Liquors establishment, which is tentatively planned for the long vacant American Tap sit on South Illinois. Likely the location of Old Town Liquors only 2 doors away played a large part in the decision.

The principals of American Tap Liquors argued that the "cluster effect" , the grouping of similar businesses near each other as you often see with clothing stores in a mall and car dealerships, would increase the sales of both businesses. However, the cluster effect only works if you have stores with similar but not identical products.Clothing stores and auto dealerships work because each offer similar products but with enough differences that customers will move from store to store. unless American Tap Liquors goes after a really high end audience, unlikely in a collage town, especially in the downtown area, you wind up with two stores, thirty feet apart, selling the same products. Both are going to carry Budweiser and Coors, with the only difference the price. Given that situation, one of the stores would not last very long.

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