On one hand, a Cashiers store could hurt Sylva’s profits on its own liquor store — currently the only Alcoholic Beverage Control operation in the county.
But if Sylva joins forces with the county, it could share in profits from the Cashiers store, should it prove successful.
Currently, Sylva splits the profits of its own store with the county — so presumably the county would share some of its profits from a Cashiers store with Sylva, but exactly what the profit sharing percentage would look like has yet to be broached.
Either way, the county commissioners have signaled they plan to form a Jackson County ABC board — the prerequisite to opening an ABC store — by early March.
“It’s fair to say we will have a board,” said County Manager Chuck Wooten. “There’s enough of a feeling among commissioners that a store is wanted in the Cashiers area, and the only way to get that is to have countywide board.”
Whether that board is a cooperative board with Sylva, or the county’s own board, is to be determined.
At the heart of Sylva’s conundrum is how much business a Cashiers store would steal away. Clearly, some liquor sales would simply be shifted from the Sylva store to a Cashiers store — resulting in no new revenue for either the county or town.
As much as $300,000 in sales at the Sylva store comes from restaurants, bars and country clubs in Cashiers, which would shift to the new Cashiers store.
To truly offset the overhead and operations of a second store, a Cashiers operation would have to pick up brand-new business — not just stealing Sylva’s sales — to make it a win-win. And that means attracting customers who otherwise get their liquor from somewhere else, such as Highlands in Macon County, said Mark Jones, the county commissioner representing Cashiers.
Jones is even guilty himself of popping across county lines to Highlands’ liquor store. He is not alone. Jackson County residents spend an estimated thousand dollars per week at the Highlands’ ABC store.
Many of the vacationers and second-home owners — who swell Cashier’s population to 10,000 in summer months — stock up before coming to the mountains.
“You’re talking a lot of untapped revenue source out there,” Jones said.
Sylva Town Manager Paige Roberson has questioned how long it would take a Cashiers store to become self-sustaining, and whether it would pick up enough new business to offset both the overhead and losses at Sylva’s store. If the town and county’s board are rolled into one, would the profits of the Sylva store will be dragged down by a struggling startup store, Roberson wondered.
During the past several years, money from the local ABC store has provided about $160,000 annually to Sylva’s coffers. Out of a town budget of about $3 million, losing the ABC distribution money while a new store finds its feet and customer base would have a significant impact.
Sylva would have a lot to offer in a joint operation. Its store has ample storage space for inventory and experienced staff and ABC board members who could offer advice to the county — from navigating the state’s ABC computer software to shelf stocking strategies — and help smooth over the transition period for a new store, Roberson said.
Ultimately, it’s a gamble of whether a new store could pay off in the end, however.
“You have to look at what’s safest,” Roberson said. “With risk you stand to earn more, but you also stand to lose more.”
Jones understands the concerns of Sylva representatives who are hesitant to enter into a contract that stands to hurt the town economically. To assuage the fears of Sylva lawmakers, he said he would consider forming a joint ABC board agreement that would guarantee Sylva’s profits from the ABC stores would not dip below a certain level for a set period of time.
Even if that meant less money for the county, commissioners view an ABC store in the southern region of the county as not only a money-maker but also a service to residents.
County and town representatives have been holding small meetings to hash out the details of what a combined, or separate, board would look like. They hope to bring proposals before their respective boards in the coming weeks.
The Sylva town board will discuss merging with a county ABC board at its next meeting on Feb. 7.
Sylva Alderman Harold Hensley, who has not been in on the talks, said he is interested to hear any proposals, although his priority is protecting the revenues of the town budget. Also, with summer high season in Cashiers approaching, the county is moving to have a store in place in time to catch the influx of residents.
“The county is wanting to move pretty quick on their end,” Hensley said. “I just really hope whatever they work out, our revenues won’t get hit.”