- 26 -
in December is generally applicable to advertised wine and liquor
during the other months of the year. This low margin takes into
account the year-round "loss leaders" that petitioners advertised
and sold below cost, as well as the higher margin, but still
discounted, sale of wine and liquor. Petitioners charged
similarly discounted prices in this range for their in-store and
"perma sales".
We further conclude that there were substantial sales of
petitioners' nonadvertised, and smaller sized, wine and liquor.
This category included items such as the 750-milliliter Riunite
wine, the 750-milliliter Andre Pink Champagne, and 1-liter Jack
Daniels whiskey. These items, while still generally priced at a
discount from retail averages, nevertheless sold at margins near
20 percent.
On the basis of the foregoing, we find that the overall
margin applicable to petitioners' annual sales of wine and liquor
was 13.5 percent.
C. Margins on Sales of Cigarettes
Dr. Rossi determined that the cigarette invoices and
advertisements supported a finding that the average margin on
both generic and brand-name cigarettes was 5 percent.
Once again, Dr. Rossi's figures are based upon advertised
sale prices. Petitioners' principal competitor indicated,
however, that cigarette margins varied; he himself had made
Page: Previous 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 NextLast modified: May 25, 2011