The purpose of this paper is to show that new‐style retail wine stores with features such as tasting rooms, lecture theatres and demonstration kitchens used to educate and engage customers have better retail efficiency than old‐style stores.
Sales dollars, labour hours and litres of inventory depletion from a paired sample of old‐style and new‐style facilities located in five different communities are submitted to a data envelopment analysis to determine the retail efficiency of the stores.
All the new‐build stores had higher retail efficiency than the older stores, and input reductions in older stores were unlikely to bring their performance up to the level of the new store concepts.
One of the shortcomings of this research is that the old and new stores in the paired samples are different in size and location within each municipality. While it is clear that the new store features (tasting rooms, seminars, cooking demonstrations, etc.) increase retail efficiency, it remains to know the contribution of each of feature to the improvement in retail performance.
