Hoppy Days Near for Co-op?

Have a beer after work on the terrace of the Swarthmore Co-op? Pick up a bottle of wine along with your chicken and your dish soap?

Many Swarthmoreans have long dreamed of such scenarios. Now those dreams are one giant step closer to coming true.

The Swarthmore Co-op received a liquor license from the Pennsylvania Liquor Control Board (PLCB), General Manager Mike Litka announced in an email to members on July 1.

Zombie License

Last March, the Co-op board decided to bid on a so-called “zombie license” — a lapsed liquor license, abandoned by its previous owner, that has reverted to the state. Pennsylvania started reselling such licenses via sealed bids in 2016.

“For a long time, grocery stores and Wawas were buying them all up,” board president Donna Francher explained. “They were pricing out everybody else.” But prices have come down as low as $30,000, she said — though some can still go for twice that amount or more. 

Buying an active license often costs upwards of $100,000. “The going rate before the coronavirus was somewhere around $180,000 to $200,000,” Francher said. “We saved a lot of money by doing an auction.” She declined to say how much the Co-op bid, but the minimum for this round was $25,000. Due on March 16, bids were supposed to be opened on March 19. But then the coronavirus pandemic shut everything down.

“They finally decided to open up the bids last week,” Francher said. “We had won.” 

Litka called the ability to sell beer and wine “a key component of our strategy to ensure that the Co-op remains fiscally healthy.” Co-op sales have declined by about 2% each year for the last several years. 

Beer and wine sales have a profit margin of close to 30%, Francher said, compared with approximately 5% for groceries.

Next Steps

The board is now applying for permission to use the license — a separate step involving site plans and background checks. Under normal circumstances, this would take 75-90 days, Litka said. Because of the COVID-19 pandemic, the PLCB has extended that estimate to 100-120 days.

The Co-op must also receive a favorable legal decision from the Delaware County Court of Common Pleas. The board filed a motion on October 2, 2018, asking the court to set aside a 19th-century deed restriction prohibiting the sale of alcohol in a wide swathe of downtown Swarthmore known as the Biddle Tract.

The original August 2020 court date has been pushed back indefinitely, also because of the coronavirus.

Assuming that all goes well and the Co-op clears the next hurdles, the store may start small, stocking six-packs of beer on non-refrigerated shelves. “As we make money from the sales, then we would progress,” Francher explained. 

Whether they take that approach, or install coolers and start bigger, beer will be available before wine. The commonwealth stipulates that stores with new liquor licenses sell beer first, with further training and fees required before adding wine. 

Francher is looking forward to that milestone. “It would be nice to be able to walk in and get my groceries and a bottle of wine,” she said. “Hopefully that will come sooner rather than later.”

What beer and wine, exactly, do they plan to sell?

“One of the last things we’ll look at is the product selection,” Litka said. “We have to get through a lot before we get to that process.”