Total Wine & More<\/a> and asks him to put on his name tag. As a checkout line lengthens, Trone calls on the staff to open another register.<\/p>\nLater, in the wine classroom, Trone asks the store\u2019s wine expert what varietals will be served at that evening\u2019s event for its VIP customers, people who spend thousands of dollars per year on wine.<\/p>\n
Shortly thereafter Trone demonstrates how a customer can use a smartphone to scan a QR code, positioned in front of bottles of Dogfish Head Indian Brown Ale, to call up a video of the head brewer describing the product. Before the video can start, spam infiltrates Trone\u2019s iPhone. He pulls out a pocket voice recorder and dictates a reminder to query his staff about how to block spammers.<\/p>\n
Welcome to the new world of selling beverages to adults. To put it another way, this isn\u2019t your grandfather\u2019s liquor store.<\/p>\n
TRONE, A 1977 FURMAN GRADUATE<\/strong> whose family name now adorns the university\u2019s remodeled student center thanks to a $3.5 million gift from him and his wife, June, is creating one of the nation\u2019s top retail chains. Since 1991, when the first Total Wine opened, Trone and his brother, Robert, have built a business with about $1.2 billion in yearly sales and more than 85 locations in 14 states. The store in Claymont, Del., just off Interstate 95, is the company\u2019s busiest, posting $80 million in sales per year. The Trone brothers remain the only owners of the business.<\/p>\nSome craft brewers and small-scale vintners have developed their brands \u2014 and expanded their own small businesses \u2014 by clinging to the coattails of Total Wine\u2019s increasingly extensive retail footprint.<\/p>\n
\u201cThere are other retailers we work with \u2014 Whole Foods, Wegmans \u2014 but our sales at Total are significantly greater on a per-store basis\u201d than any other retailer, says Jim Caruso, general partner and chief executive of Flying Dog Brewery in Frederick, Md.<\/p>\n
In short order, Total Wine has become the nation\u2019s biggest pure-play alcoholic beverage retailer, according to Beer Marketer\u2019s Insights<\/em>, a Suffern, N.Y.-based trade publication for the industry. (The warehouse club chain Costco posts higher alcohol sales overall, but it also sells food, clothing and many other products.) Insights<\/em> says that Total Wine is probably at least twice as large as the second-biggest pure-play alcohol retailer, ABC Fine Wine & Spirits of Orlando, Fla.<\/p>\nFor those who knew Trone during his days at Furman, his success as an entrepreneur is anything but surprising. When the Bonhomie<\/em> needed a business manager for the yearbook, Trone volunteered and \u201cwent all-in,\u201d says a Furman friend, Richard Barr \u201978. Failure was not an option.<\/p>\n\u201cHe acted like it was his own business, selling ads \u2014 and he can be persuasive \u2014 and collecting money,\u201d says Barr, a principal with an engineering and urban planning firm in Tallahassee, Fla. \u201cHe loved to win. He hated losing.\u201d<\/p>\n
Trone initially wanted to go to law school, but his childhood experiences drew him back into the world of entrepreneurship. His father was an egg farmer in Adams County, Pa., where Trone grew up, although he had other businesses as well. \u201cHe was a serial entrepreneur,\u201d Trone says. One of those side gigs was running a small grocery store, which was designed mostly to sell his eggs. The store eventually grew into a small beer distributor. After Trone\u2019s parents divorced, his mother took the beer retailer and Trone took the farm.<\/p>\n
After graduating from Furman magna cum laude<\/em>, Trone enrolled at the Wharton School of Business of the University of Pennsylvania. He juggled going to school for an MBA with running his father\u2019s farming business, which at that point was losing money. His father eventually went bankrupt \u2014 which taught Trone a lesson.<\/p>\n\u201cHe didn\u2019t pay enough attention to the income statement,\u201d Trone says. \u201cI learned that you can\u2019t get overextended or overleveraged. Sometimes, when bad things happen, it makes people more aware of what needs to be done.\u201d<\/p>\n
Trone liquidated his father\u2019s business, which included the family home. Shortly thereafter, while still at Wharton, Trone launched the first business of his own, a beer store in Harrisburg, Pa., called Beer World. He soon opened another store in Pittsburgh. The predecessor to Total Wine was born.<\/p>\n
TRONE SIGNED UP<\/strong> for classes <\/strong>on state laws for alcohol sales while at Wharton, knowing he would need that knowledge for his business venture. It\u2019s perhaps something of an understatement to describe alcohol sales as a highly regulated industry, although Trone describes the rules landscape for his business in slightly different terms.<\/p>\n\u201cThere is a myriad of anticompetitive laws that serve as barriers to entry to the alcoholic beverage retail industry that are different in every state,\u201d he says. \u201cThe United States is not one country with one set of alcohol laws, like France. It\u2019s 50 states with 50 different sets of laws.\u201d<\/p>\n
Trone has become something of an expert on this subject, with litigation and lobbying integral parts of his expansion strategy. He sued Pennsylvania alcohol regulators over the state\u2019s laws on advertising the price of its beer. He\u2019s lobbied legislatures in several states, including South Carolina, to allow for the sale of beer with higher alcohol levels. In Total Wine\u2019s longest-running legal battle, a federal appeals court ruled in 2009 that the state of Maryland\u2019s laws banning volume discounts amounted to restraints on trade. That ruling could have an impact on Total Wine\u2019s sales across the country.<\/p>\n
The m\u00e9lange of state and federal laws created by the ratification of the 21st Amendment, which repealed Prohibition, is a blessing in disguise for Total Wine. The lack of a uniform, nationwide set of rules for all states means that no one can become the Amazon of alcohol sales. Thus, Total Wine does not face the type of serious threat from online sales as do such retailers as Barnes & Noble or JCPenney.<\/p>\n
\u201cLargely because of the 21st Amendment, we\u2019re inoculated from what\u2019s happening with Amazon destroying the electronics business at Best Buy and the office supply business at Staples,\u201d Trone says.<\/p>\n
Total Wine conducts online sales to about a dozen states, where the practice is legal. But the main goal of Total Wine\u2019s online strategy is to educate its customers about wine, beer and spirits. The company is spending about $6 million to improve its website and provide more opportunities for interaction with customers.<\/p>\n
\u201cThe mission is to drive bricks-and-mortar sales,\u201d Trone says.<\/p>\n
Technology is deployed strategically inside Total Wine stores. At the McLean location, situated in an affluent area of the northern Virginia suburbs of Washington, D.C., an iPad is prominently displayed at an information desk in the wine section. Shoppers can punch in their dinner plans \u2014 pork, beef or fish\u2014 and receive customized suggestions as to whether to pair the meat with a Pinot Noir or a Gewurtztraminer.<\/p>\n
\u201cIt will spit out choices, and you scroll down and pick the one you want,\u201d Trone says.<\/p>\n
REAL ESTATE<\/strong> is another important part of the Trone business playbook. If you\u2019re going to run an upscale alcoholic-beverage retailer, Trone surmises, it\u2019s probably a good idea to keep respectable neighbors. He instructs his real estate-scouting department to find store sites that are as close as possible to high-end retailers like Bed Bath & Beyond or the Container Store.<\/p>\nThe company\u2019s product inventory reflects the desire to appeal to high-income, educated customers. Step inside a Total Wine store and you\u2019ll have a difficult (if not impossible) time trying to locate dirt-cheap jug wine or Milwaukee\u2019s Best beer. Instead, one of the first things a customer sees is a wall taken up by a large, glass-doored display room, kept at the ideal temperature for storing wine. Inside are some truly top-notch wines. Fancy a $2,999 bottle of Bordeaux, anyone?<\/p>\n
\u201cThey turn 30,000 square feet of selling space from what could be an average warehouse wine store into a beautiful specialty store experience,\u201d says Kip Tindell, chair and chief executive of the Container Store.<\/p>\n
Trone\u2019s success hasn\u2019t gone unnoticed. The alcohol-retail industry magazine Market Watch<\/em> gave the Trone brothers its \u201cRetailers of the Year\u201d award in 2006 and predicted rapid growth for the chain, partly because of its willingness to engage in litigation to seek more favorable laws. The magazine\u2019s prediction came true.<\/p>\nBeer is the fastest-growing product at Total Wine, specifically craft beer, with sales increasing at an annual clip of about 26 percent, Trone says. Total Wine is also a major player in the national explosion in popularity of craft brewing. The company offers hundreds, if not thousands, of items from brewers across the country and the world, in styles ranging from Belgian quadruples to imperial stouts.<\/p>\n
That\u2019s a critical element to the success of the Flying Dog brand, Caruso says. If people can\u2019t easily find Flying Dog\u2019s products, they\u2019re not going to buy them.<\/p>\n
\u201cThey make a huge effort to carry all of our products, all of the time,\u201d Caruso says. That\u2019s not a simple task. Flying Dog makes 10 core products that are sold year-round, like Old Scratch Amber Lager, plus seasonal offerings like K-9 Winter Ale and one-time offerings like St. Eadman\u2019s, a Belgian-style dark ale.<\/p>\n
Don\u2019t expect to see any new retail ventures from Trone any time soon. There\u2019s no Anvils \u201cR\u201d Us on the horizon, no Widget Depot, no new variations on the pet store theme. He\u2019s got plenty of room across the continental United States for expanding Total Wine before he moves into any another business, and he says there\u2019s too much \u201cwhite space\u201d to fill up before he launches any new store concepts.<\/p>\n
For the time being, he\u2019s focused on expanding Total Wine in Texas. He also has California in his sights; he recently opened a new store near Sacramento.<\/p>\n
TRONE ISN\u2019T OPPOSED<\/strong> to the concept of selling his company, headquartered in Potomac, Md., to an outside investment firm, or even to a larger retail company. An Initial Public Offering could also be in the cards, although it isn\u2019t at the top of his list.<\/p>\n\u201cIt\u2019s always something to think about, but I think we\u2019re better off to grow at a judicious pace,\u201d he says.<\/p>\n
More pressing is the final prong <\/strong>of Trone\u2019s business strategy \u2014 community involvement. That shouldn\u2019t be a surprise, considering his generosity to Furman.<\/p>\nIn addition to their contribution toward the student center, he and June have donated $1.5 million to cover start-up costs for Furman\u2019s men\u2019s and women\u2019s lacrosse teams, which open varsity play in 2014. Their other gifts include a $500,000 pledge toward endowing the Riley Institute. Trone also serves on the board of trustees and routinely donates Total Wine products to Furman events.<\/p>\n
The charitable giving extends to the communities where Total Wine does business. The company partnered with law enforcement officials in the Tampa, Fla., area in November to raise awareness about the dangers of drunk driving during the holiday season. Total Wine has also worked with Jack Daniel\u2019s to promote the use of designated drivers.<\/p>\n
\u201cThe money we make, we put back into the community,\u201d Trone says.<\/p>\n
His generosity extends to friends and former classmates. Richard Barr says Trone has paid for his family to attend World Series games, pro basketball games, concerts and more.<\/p>\n
\u201cThese are things I would never have done, if it weren\u2019t for Dave,\u201d Barr says.<\/p>\n
The author, a 1992 graduate, lives in Washington, D.C., and writes for <\/em>American Banker, a newspaper covering the financial industry. Photo copyright William Stewart Photography.\u00a0<\/em><\/p>\nThis article from the Winter 2013 issue of<\/em>\u00a0Furman magazine.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"by Andy Peters David Trone walks past a display featuring holiday wine suggestions. He sees an assistant manager standing behind the customer-service desk at the McLean, Va., location of Total […]<\/p>\n","protected":false},"author":265,"featured_media":2561,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3],"tags":[],"class_list":["post-2560","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-alumni"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/posts\/2560","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/users\/265"}],"replies":[{"embeddable":true,"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/comments?post=2560"}],"version-history":[{"count":0,"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/posts\/2560\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/media\/2561"}],"wp:attachment":[{"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/media?parent=2560"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/categories?post=2560"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.furman.edu\/news\/wp-json\/wp\/v2\/tags?post=2560"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}