Electronic store

Delhi faces shortage of liquor stores as stores close due to poor business

The number of retail liquor stores in the city has shrunk by around 200, with many licensees leaving the business due to “financial losses” and the problems they face under the new licensing regime. excise policy, sources said.

A total of 849 liquor store licenses were issued by the Delhi government last year under its 2021-22 excise policy. However, only 639 stores were still open at the end of May this year, according to official figures.

The latest list of retail liquor stores shared by the Excise Department on its website showed the number fell to 464 in June.

The Excise Policy 2021-22 which ended on May 31 has been extended for two months by the Delhi Government Excise Department offering retail license holders the option of renewing their licenses by paying a fee to the pro rata for the additional period.

However, many licensees did not opt ​​for the extension and closed stores as they were already struggling to break even after paying high license fees, liquor traders claimed.

“There were various reasons that chilled the minds of retailers, such as the issue of opening liquor stores in non-compliant neighborhoods, fierce competition driven by steep discounts, and new brands entering the market. market,” said a liquor trader. .

Under current excise policy, each licensee was required to open three stores in each municipal ward. However, out of 272 municipal wards, 100 were non-compliant where shops could not open due to action by civic bodies against violations of Delhi’s master plan rules, officials said.

“As retailers are allowed to give discounts to consumers, some big players have been promoting new brands with programs such as ‘buy one, get one free’ and offering discounts of up to 40%. The government stepped in and capped the discount at 25%, but retail stores did not refrain from offering higher discounts,” said another liquor marketer.

The 2021 excise policy was extended until July 31, but licensees in nine of the 32 areas did not renew their licenses for different reasons, an apology department official said.

Last year, licenses for 32 areas, each with permission to open 27 stores, were auctioned off by the government at high prices.

Area 31, comprising New Delhi City Council (NDMC) and Delhi Cantonment Area, was auctioned for Rs 315 crore, against a reserve price of Rs 217 crore.

Area 19, comprising of Daryaganj, Chhatarpur, CR Park, Sangam Vihar, Chandni Chowk and other areas, opted for Rs 313 crore against the reserve price of Rs 225 crore.

The bid reserve price was set at Rs 221 crore and bids were awarded at an average premium of 20%, with the average bid price standing at Rs 265 crore, officials said.

“After paying the high licensing fees, retailers failed to recoup their investments as the implementation of the new policy was delayed and stores could only start opening from November. 2021. This, coupled with issues of non-compliant and unchecked neighborhoods discounts, has further soured the market,” an industry insider said.

With licensees forced to close shops, many parts of the city are left without liquor sales, they said, citing Hauz Khas, Laxmi Nagar, Dwarka, Model Town and Shakurpur, among others.

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