On Its 50th Anniversary, Goody Goody’s CEO Surveys The Dallas Liquor Store Landscape

goody1by Andrew Chalk

In 1964, Joe Jansen bought a 15 by 20 foot Greenville Avenue liquor store named Goo Goo and changed its name to Goody Goody (in order to save the cost of buying a new sign). This month, Goody Goody is celebrating the company’s 50th anniversary at each of its 21 locations throughout Dallas, Houston and Longview. It is the oldest liquor store chain still owned and run by the founder, and has grown to annual revenue of $250 million. In the Dallas market, Goody Goody (including its wholesale business) is the largest liquor store chain.

I have bought a lot of wine at Goody Goody and always regarded them as a great source of bargains. At the same time, I have also found the company idiosyncratic. For example, look at its web site. What a sorry excuse for an e-commerce channel. Or consider the sea change of Dallas (1,3m people), Plano (275,000 people), Lewisville (101,000 people) and Arlington (380,000 people) all going “wet” in the past four years. Why no flurry of new stores?  

I decided that I needed to go to the source and requested an interview with Joe Jansen himself, expecting to find that “his schedule did not permit it” or some such excuse. On the contrary, he made himself available and offered multiple times (but no corporate portrait).

Before we go into the questions, consider the backdrop to all this. The DFW retail liquor market has seen huge changes in recent years. Among local retailers, Red Coleman sold out to Majestic (18 stores before the transaction) in 2005 (some say due to succession issues) which, in 2011, sold out to Centennial (27 stores before the transaction). Doug Miller, Centennial’s majority owner, said at the time, “We are extremely excited about the tremendous opportunity to add the Majestic group of stores to our liquor store portfolio.” Centennial filed for bankruptcy the following year. Sigel’s (around 22 stores) has gone after a more upscale customer with wine and spirit-centric stores in Uptown (Fitzhugh) and Plano, more upscale wine and spirit tastings than its competitors, as well as almost selling out to Spec’s in 2011. That year, Spec’s, a Houston chain that now has over 150 locations, moved into the Dallas market. Costco, the nation’s largest wine retailer, had entered the D/FW the wine market in 2000 with the intention of opening five stores. It now has 10 locations in the area. In 2012, the multi-state liquor chain Total Wine moved into DFW.

Behind all this, a new category of distribution emerged in the form of the Internet. Its efficacy for selling wine was multiplied in 2004 by the U.S. Supreme Court, which legalized interstate sales of wine direct to consumers. This, plus other state-level legal changes, created something closer to a national market for liquor and wine. As a result, a whole new category of major retailers, particularly of wine, appeared. Names like wine.com and amazon.com/wine became familiar.

goodygoodytruck1a

One thing that is clear: thus far Goody Goody has proven a survivor. People in the liquor business that I spoke with for this story said that the company maintained an extremely strong balance sheet. One said that new stores are never financed with borrowing. Of course, I can’t independently verify this as I haven’t seen the books of this privately-held company. And private it is. When I asked Marketing Communications Manager Armando Gonzalez for a picture of Joe Jansen for this article, he politely apologized that they did not have one.

CraveDFW: Joe Jansen, thank you for taking time out of your busy schedule for this interview. Perhaps I could start by asking you what the revenue breakdown between beer wine and liquor is in your stores?

Joe Jansen (JJ): Beer is 10-15%, wine 25%, spirits 50% and ‘other’ about 10%.

CraveDFW: What effect has the arrival of Specs and Total Wine in Dallas had on Goody Goody?

JJ: Some effect, obviously.

CraveDFW: Why you have recently expanded into Houston after years of confining yourself to Dallas (and Longview)?

JJ: For years liquor stores competed in citywide markets. There wasn’t any agreement not to go into other cities, that’s just how the competition was. Recently, more places have held votes about going ‘wet’ with the ‘wet’ side winning. There seems to be a change in public attitudes about beer, wine and spirits. So you have seen Spec’s expand into Dallas and us go into Houston. I think you will see more of this.

In the Dallas area we have seen Dallas, Plano, Lewisville and Arlington vote and choose wet. Denton might be next.

CraveDFW: What effect have those referendums had on the retail liquor business?

JJ: There has been a scramble to move stores that served those markets from wet areas (mainly Dallas) into the newly wet areas. For example, there are about twenty five new liquor stores in Plano, all of which used to be served by stores in Dallas.

The vote to go wet also explains Total Wine’s entry into this market. Texas is the nation’s second largest market and they want a piece of it.

CraveDFW: Why have you not opened stores in the newly wet areas?

JJ: There has been a scramble and we are waiting for it to settle down.

CraveDFW: Turning to the Internet. You have seen how sites like Wine.com and brick-and-mortar operations like K&L and Brown Derby have aggressively got into Internet marketing. Yet your own commercial presence on the Internet might be described as late and limp. Why not a bigger push?

JJ: We don’t see it as having a huge effect on our sales at the time, but we are always closely monitoring new trends.

CraveDFW: Recent years have seen some familiar names disappear from the DFW landscape. For example, Centennial used to have the most stores. What led them to file bankruptcy in 2012?

JJ: They had too many small stores which they kept open too long.

CraveDFW: Do you think the retail shakeout is over?

JJ: No, but I am doing my best to ensure that Goody Goody is one of the survivors.

 

1 Comment

Filed under Andrew Chalk

One response to “On Its 50th Anniversary, Goody Goody’s CEO Surveys The Dallas Liquor Store Landscape

  1. Lone Star Man

    Andrew,…Many years ago, I was vice-president and branch manager of the late great lone star company of texas!.I shared with Joe Jansen then that without continued effort from himself,Sidney Sigel,Pinky Rhoden,
    and Spec Jackson,(too name a few)Texas would someday
    be invaded by other liquor companies from other parts
    of the U.S.At the time, these men had such a power hold
    on the reins of the Texas liquor industry that they could keep any invader from coming into Texas.The Texas retail Package Store association was a close knit organization
    that supported each other and there was a gentlemens
    agreement that store owners would stay in their respective
    markets.When the “Liquor Barons of Texas” passed away,
    the market was unguarded and the U.S. Supreme Court
    decisions allowed unwanted competition into Texas!
    That would never have happened if Sidney Sigel and
    Pinky Rhoden were still alive!!Joe Jansen is the last
    remaining “Baron” still living and he has lived long enough
    to see my prophecy come to fruition!!The industry back then was like a “brotherhood” and we looked out for one another….Now it appears to be dog eat dog,…so very sad!!

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