Iowans’ continue buying more expensive alcohol drinks — leading to another record sales year. Lynn Walding oversees the Alcoholic Beverages Division and says sales of "spirits" jump up double digits in the fiscal year that ended July 1st.
Walding says the sales of hard liquor went up 10.5%, compared to wine which was up seven percent and beer, which was up only one percent. Walding says the state took in a record of nearly 177-million dollars in wholesale liquor sales, surpassing the 165-million dollars last year.
Walding says younger Iowans continue driving sales. He says the 21 to 29-year-old group continues growing two-percent a year as more Iowans reach the legal drinking age, and that age group continues buying spirits. He says that age group is also doing what’s known as "trading up" — or buying more expensive brands. Walding says as customers buy more expensive alcohol, the amount of tax paid goes up, increasing the state’s take.
He says liquor makers have done a good job of targeting the young drinkers by constantly introducing new flavors of alcohol, and marketing the products the same as beer. Four new casinos have opened up in Iowa and Walding says that does have some impact on alcohol sales.
Walding says new casinos do create a new "pipeline" for alcohol and an increase in sales, "I wouldn’t say it’s significant, but it does add to the total volume of sales in Iowa." Walding says the dynamic growth in alcohol sales is unique when you look at the overall population trends.
"Iowa has experienced consistent growth now (in dollar sales of alcohol) for 12 straight years and there does not appear to be an end in sight," Walding says, "What’s interesting, a lot of that growth is coming without any population growth. Rather it’s the growth within that population that can consume, specifically the 21 to 29-year-old group." Walding says the increase in dollar sales benefits the state.
Walding says the Alcoholic Beverages Division transferred just below 90-million dollars to the state’s general fund, so the sale of alcohol generates roughly three percent of the state’s overall revenues. Walding says the alcohol business continues to be "economy proof" as sales don’t seem to be impacted by higher gas prices or other increases in costs.
