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City Council Regular Meeting Minutes February 23, 2021 Page 2 1 2 Liquor Operations Manager Mike Larson provided a power point presentation for the Council for 3 the Liquor Operations Annual Report. Mr. Larson reviewed there are two convenient locations. 4 The Mission Statement and Vision Statement were provided. Mr. Larson noted a more detailed 5 report can be found on the City's Website. There are five full time employees including Mr. 6 Larson. The value of municipal liquor operations and the value of St. Anthony Village Wine and 7 Spirits. The trends during 2020 included: 8 • Sales increase of 13.8% - Closing or reduced hours of bars and restaurants. 9 • Net Profit Increase of 57.6% - Pandemic buying, large quantities and higher quality/price 10 items. 11 • Salaries/Wages/Benefits Increase of 2.6% - Increased sales and profits within our current 12 capacity. 13 • Total Operating Expense Increase of 9% - Costs associated with pandemic safety 14 measures. 15 16 Mr. Larson provided a Sales and Profit Comparison 2020 to 2019 and a 2020 Sales Comparison 17 5-Year Monthly Sales History — Combined Stores. Five-year Profit History and 10-year Profit 18 History were provided. 19 20 Mr. Larson reviewed Benchmarks and Comparisons including: 21 • Inventory Turn Ratio = 5.6 times. 22 • Inventory Value = 13.7% 23 • Labor Costs = 12% of total sales. 24 • Operating Expense = 18% of total sales 25 • Physical Inventory Adjustments = ($4,959) 26 27 According to the 2019 State Auditors Report the St. Anthony Village Liquor Operations ranked 28 17th in the State in Total Sales and 12th in net profits of 18 metro operations. 29 30 Mr. Larson reviewed where the Liquor Operations were pre-Covid 19 compared to where the 31 Liquor Operations are now. Looking ahead in 2021 the plan is to add curbside customer order 32 pick-up option, customer delivery option, resume sampling events, collaboration products with 33 local distilleries and breweries, evaluate future store hours, monitor latest technology to provide 34 staff and customer safety measures, reinvestment in the infrastructure and liquor store staff Goal 35 Setting and Strategic Planning session. 36 37 The website SAVMN.COM includes event calendar, monthly specials, news and updates, 38 product requests. store hours and contact information. "Notify Me", email and text alerts are 39 available. Information is also available on Facebook and shortly will be available on Instagram. 40 41 Mr. Larson thanked the staff for their hard work throughout 2020. He also thanked the customers 42 for their support in 2020. 43 44 Councilmember Walker asked about the ten-year profit history years 2011, 2012 and 2013 are 45 relatively in the same ball park. Business picked up in 2020. Councilmember Walker asked if 46 there is a reason for the higher profit in 2011, 2012, 2013. Mr. Larson stated in 2014 a big box