Commonwealth Journal

January 12, 2013

Liquor World CEO: ‘We had a tremendous economic impact plan for the city

By CHRIS HARRIS, CJ Staff Writer
Commonwealth Journal

Somerset —  

Wesley Morgan may not be opening up a Liquor World in Somerset anytime soon. But remember the name — you might be hearing it in the future.
“Our plan is still to come to Somerset, and we will be there as soon as we make some deal with somebody,” said Morgan, “as soon as they decide (the liquor business) is the wrong thing for them to be in.”
Morgan is the CEO of Liquor World, a high-volume alcoholic beverage retailer headquartered in Kentucky. In addition to its 27,000-square-foot headquarters in Richmond, Liquor World operates a 4,000-square-foot express store in Manchester.
But Morgan was seeking a presence in Somerset as well. As expressed to the Commonwealth Journal in September, the businessman had designed on spending $5 million to purchase and remodel the North Plaza Shopping Center on North U.S. 27, where Big Lots and Peddler’s Mall are currently located.
For now, at least, that won’t be happening. The Kentucky Office of Alcoholic Beverage Control (ABC) announced the five local businesses to be awarded Retail Liquor Package licenses — the certification needed to sell distilled spirits and wine in a commercial store setting. The state determined that only five of approximately 17 applicants would be awarded the limited “quota” licenses, based on Somerset’s size and what Kentucky ABC officials determined the market to be.
Morgan’s business Liquor World — along with similar competitor Liquor Mart, which also has a presence in Richmond along with neighboring communities like Danville and Lancaster — was in the hunt, but found themselves denied. The licenses were awarded to two national pharmacy chains with locations in Somerset — Rite-Aid and Walgreens — and three local business owners with smaller facilities than what Liquor World would be planning.
Morgan had previously said the Somerset Liquor World would hire between 15 and 25 employees from the local labor force.
Morgan described his feelings about the outcome as “disappointment with the ABC” and said that the local entrepreneurs would be hard-pressed to offer  similar wide selection or sales numbers compared to his store.
“I don’t know how you get a license anymore,” said Morgan. “We had a tremendous economic impact plan for the city. Basically, who loses in this is the City of Somerset, because you can’t generate the kind of sales in small stores that you can in a 20,000-square-foot store.”
Added Morgan, “You won’t be able to walk into store and have all the variations of micro-brewed (products).. ... No one has the space for it.”
And it’s not just the liquor. In September, Morgan stated that his business was “in talks” with national restaurant chain Texas Roadhouse to put a location in the shopping center.
Later in the year, it was announced that Texas Roadhouse had struck a deal with developer Brook Ping’s company to locate further down U.S. 27, in the Stonegate Centre. Morgan said simply that the chain had “selected another location,” but added, “We had been talking to other restaurants.” 
Said Morgan, “It wasn’t just (Liquor World that was of interest locally), but the purchase of the shopping center and the revitalization of the whole area.”
So why not go with Liquor World? “We were probably penalized because we sued the ABC over Corbin,” said Morgan. “That’s the only reason I can come up with (as to why) they’ve done what they’ve done.”
After being denied a license to open a store in Corbin, which recently went “wet” like Somerset, Morgan filed a lawsuit seeking to invalidate the issuing of the Retail Liquor Package licenses in that community, but it was dismissed in December in Franklin Circuit Court, as the judge said that Morgan lacked standing.
“We sued the ABC to make them look at some evidence where there were false applications filed (in Corbin),” said Morgan. “It’s not attacking ABC as much as the lack of following procedures. ... All we did was challenge and showed the ABC that the violations were there. It’s almost like a whistleblower penalty.”
Morgan said that the liquor business is a “competitive market” and said that many customers may still go out of town to buy liquor because it will be cheaper than in Somerset.
“(The current licensees) won’t be able to buy merchandise in larger quantities because they have no place to store it all; the stores are too small,” said Morgan. “Ninety percent of the time, Rite-Aid’s sell price is above our everyday price. 
“The people of Pulaski County will pay that price for a while until we buy somebody out to get into Somerset,” he added. “We’ll have to get them after a year (approximately) before they understand they didn’t hit the lottery. They will find (a liquor store owner) doesn’t really pick the lottery unless you’ve major money to invest in inventory.”