MINUTES OF THE MEETING OF THE UTAH

ALCOHOLIC BEVERAGE CONTROL COMMISSION,

OPERATIONS AND PROCUREMENT SUBCOMMITTEE

HELD TUESDAY, DECEMBER 17, 2013, AT 1625 SOUTH

900 WEST, SALT LAKE CITY, UTAH.

[Copies of the proposed agenda for this meeting were emailed to all persons on the regular email list (a copy of which is located in the front of the minute book) and to all of the individuals and groups on the agenda (applicants, those with violations, etc.) on Wednesday, December 11, 2013. A copy of the final agenda was posted on the bulletin board at the DABC Administrative Office, emailed to the Salt Lake Tribune and the Deseret News, and posted on the Utah Public Notice Website by 9:00 a.m. on Monday, December 16, 2013.]

Dennis Nordfelt called the meeting to order at 9:00 a.m.

Commissioners Present: Jeff Wright and Dennis Nordfelt.

Staff Present: Salvador Petilos, Director; Tom Zdunich, Deputy Director; and Benn Buys, Finance Director.

APPROVAL OF MINUTES:

Upon motion of Mr. Wright, seconded by Mr. Nordfelt, it was unanimously voted to approve the minutes of the Operations and Procurement Subcommittee meeting held November 26, 2013.

UNIVERSITY OF UTAH MBA STUDY ON STORE LOCATIONS:

Sal Petilos informed the subcommittee that the MBA study on store locations is complete and that he supported the methodology they used to arrive at their particular recommendations. The students will be giving a presentation to the full commission in the January 2014 meeting. Mr. Petilos explained the study provides a good basis for moving forward on the possibility of expanding the store network. He gave an overview of the additional actions the department is taking to evaluate future store locations.

Mr. Wright stated that it is an excellent report and he also appreciated the methodology used by the students to arrive at their conclusions.


OPERATIONS UPDATE:

Tom Zdunich gave an overview of current agency operations including:

a. Package agency audit results. Audits were conducted on three package agencies and all passed.

b. DABC store audit results. Four stores passed and three failed. The regional managers will work with the failing stores.

c. Covert Underage Buyer (CUB) results:

·  The Hurricane Police Department went into the Hurricane store and the underage buyer was refused.

·  CUB operations performed in the stores over a calendar year improved from 93% in 2012 to a 95% success rate in 2013.

d. Thanksgiving sales update. Thanksgiving shopping trends were different this year as sales were more spread out than they were in previous years. The bulk of sales were on the Saturday, Monday and Tuesday prior to Thanksgiving. Sales on the day before were flat.

e. Store hours:

·  The Park City club store hours will be increased to include Saturday openings beginning December 28, 2013 through January 25, 2014 in order to accommodate the busy ski month and the Sundance Film Festival. Signage will be posted in all Park City stores with the additional hours.

·  All stores will close at 6:00 p.m. on Christmas Eve and 7:00 p.m. on New Years Eve.

f. Store #2, Sugarhouse, sales. Congestion at the Sugarhouse location continues to be a problem due to limited parking, retail space and checkout capabilities. A breakdown shows that state stores average $50.00 in sales per square foot. However, sales per square foot at the Sugarhouse are almost three times the average. The store does over $13 million in 1,904 square feet. The store configuration will be modified to increase the amount of sales space. The cost will be around $9,000 and is scheduled to be done in March 2014.

g. Sales per square foot. A comparison of annual sales per square foot of the state stores vs. the top twenty retailers in the US shows that the state stores operate as efficiently as the twenty best retailers in the country.

FINANCIAL UPDATE:

Benn Buys gave an overview of the financials including:


a. November 2013 financials:

·  Year-to-date case sales are up 4.0% and retail sales up 5.5%.

b. Department dashboard.

c. Audit matrix. The audit matrix has been updated to include the recommendations and department actions from the recent audits.

TYPE 5 PACKAGE AGENCY APPLICATION:

a. Sugar House Distillery, 2212 S. West Temple, Salt Lake City.

Mr. Buys gave an overview of the application noting that it is complete and staff recommends approval.

Mr. Wright moved to recommend that the full commission approve a Type 5 package agency license for Sugar House Distillery in Salt Lake City. Mr. Nordfelt seconded the motion which passed unanimously.

PACKAGE AGENCY CHANGE OF LOCATION REQUEST:

a. Salina, Package Agency #120:

From: 156 West Main Street, Salina

To: 31 East Main Street, Salina

Mr. Buys gave an overview of the request noting the new location is in proximity to a library. A public hearing was held with no opposition.

Representatives from the Salina package agency explained the benefits of moving to the new location.

Mr. Wright moved to recommend that the full commission approve a change of location for Package Agency #120 in Salina. Mr. Nordfelt seconded the motion which passed unanimously.

OTHER BUSINESS:

None.

There being no further business, the meeting adjourned at 9:30 a.m.

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