05-05-1981 SpecialCITY OF RICHFIELD
Special Meeting --~
«-._:--.~-.. -- May 5, 1981
The City Council of the City of Richfield met in special session on May 5,
1981 at 7:00 p.m.
Present: Bunce, Collins, Hassenstab, Ludeman, Priebe
The meeting was called to order by Mayor Donald Priebe.
City Manager Karl Nollenberger described the purpose of the meeting to be a
study session regarding the liquor marketing analysis which was recently completed
for the city by Beverage Marketing Inc. Mr. Nollenberger introduced Mr. John Cesar
and Mr. Charles Grinstead, of BMI, and indicated that these gentlemen were the
persons who did most of the work on the marketing analysis study.
Mr. Cesar presented- an overview of the study. lIe indicated that the primary
assumption throughout the study was that the city's interest was to maximize return
on the- investment in the liquor business. In this way, he indicated, the needs of
a municipality as a factor in the liquor business is no different than the operating
concept of a private retailer in the liquor business. He summarized the. material
contained in the study report and indicated that the city needs to determine what
products, and what prices, draw shoppers into our liquor stores, and then develop
marketing strategies to meet that market.
Mr. Cesar introduced Charles Grinstead, who described specific assumptions
used in reaching the conclusions of the study. Mr. Grinstead indicated that many
of the conclusions reached are based on the firm's experience with liquor operations
in other states, and with general marketing concepts in the liquor trade. Mr.
Tom Morgal, of Minneapolis, asked about the level of inventory currently existing
in the city's liquor stores, and the desired level of inventory as described by
the study. Council members asked several questions regarding the study recom-
mendations, especially with regard to any marketing changes that the city might
Special Council Meeting -2- May 5, 1981
wish to make. Mr. Grinstead indicated that the basic marketing strategy question
relates to a "self service" concept ,compared with a "personal" service marketing
concept.
Mayor Priebe asked if the study had considered-other uses for the-Cedar Avenue
liquor store site. The consultants indicated that they had not focused extensively
on the Cedar Avenue site, but that certain types of other retail operations, such
as a grocery store or drug store use, would appeal to the same, impulse-oriented
buyer as a liquor store and could provide an effective synergism for alternative
development of that site. The city manager indicated that issues related to
additional development or relocation of ,the Cedar Avenuer`].iquor store were some what
outside the scope of the BMI marketing study. He stated that a separate study had
beee. done by the staff and the League of Minnesota Cities on redevelopment of the
Cedar liquor store site. That study will be presented at a joint HRA city council
meeting scheduled for May 18, 1981. _
Council members discussed the policy aspects of changing the liquor operations,
especially with regard to advertising policies. Mr. Cesar indicated that effective
advertising campaigns in other parts of the country and by distributors and
distillers have focused on the "enjoy in moderation" marketing and advertising
philosophy.
The city council directed the city manager to synthesize the study recommen-
dations and to develop objectives for the liquor operation similar to those developed
for the other city operating departments. Mr. Nollenberger indicated that he
would also-identify specific policy issues that are separate from operational
issues with regard to implementing the study recommendations.
The meeting adjourned at 9:10 p.m.
1
Special Council Meeting
Date Approved; May 26, 1981
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ce .Wilde Acting City Clerk
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Karl Nollenberger City Manager