Hefty salary cuts and position changes affecting three full-time Spring Lake Park liquor managers are part of a council-ordered plan to maximize liquor store profits.
The Spring Lake Park City Council unanimously approved the business reorganization July 2 after reviewing a list of recommendations made by the city’s three-member liquor commission.
Mayor Cindy Hansen, Councilmember Bill Nash and City Administrator Barb Nelson met June 6 to review the store’s current organizational structure.
According to Nelson, current and past liquor commissions have worked to maximize profits and taken such measures such as changing the store’s advertising strategy, eliminating one full-time position and freezing employee wages.
The commission’s current opinion is that the store has too many employees carrying manager titles.
Joyce Swanson is Central Park Liquors director of operations, Laura Saastamoinen is the store manager and Sue Norsten is the assistant store manager.
The liquor commission recommended and the council concurred that the director of operations position be retitled to store manager and the annual salary reduced from $75,880 to $65,880.
The store manager and assistant store manager positions will be combined into a single position.
Nelson said the current store manager’s salary is $60,432 and the assistant store manager’s salary is $43,190; the new proposed salary range for the assistant store manager will be $38,008 to $48,728.
“These changes leave one full-time position for two current employees,” Nelson said. “The liquor commission is recommending that this position be advertised, allowing the two existing employees to apply.”
A new part-time night lead clerk position would also be created as part of the Central Park Liquor reorganization, Nelson said.
During discussion, Councilmember Barbara Carlson asked if the city would come out ahead or behind financially once the changes were fully in place.
“We’re going to save $64,894 plus cost of benefits,” Nelson said.
Carlson replied, “I heard that. I also heard there’s going to be severance and other things.”
Nelson said the city wouldn’t start realizing cost savings until next year. The council should consider the changes as part of a long-term strategy, she said.
“We are top-heavy,” Nash said, referring to the current management structure. “We need to remain profitable or start looking at closing the doors.”
Councilmember Dale Dahl agreed. He said many businesses have made adjustments during tough economic times. “You do what you have to do,” Dahl said.
According to Swanson, Central Park has seven competitors within a five-mile radius.
While sales have significantly increased over the past several months, Swanson told the council the store hasn’t been able to offset expenses, despite the fact the three managers brought in $25,000 in extra sales with beer and wine seminars scheduled last year.
“I’d like to have the work we’ve done as a team recognized,” she said. “While all three of us understand what needs to be done [with the reorganization,] none of us are happy with it by any means.”
Nash replied, “I can tell you’re trying to do the right thing, and you are doing a good job. It really comes down to a bottom line [business] decision.”
Saastamoinen urged council to understand the city’s liquor operations involve strongly forged customer relationships.
“There are people [customers] who come in just to see us,” Saastamoinen said. “It will be huge detriment to the business if two people are gone and you bring in somebody that nobody knows. We saw it when we lost our last full-time position. Certain people would not come back and shop because of that decision.”
Norsten said she was angry the liquor commission never gave the store managers a chance to sit down and discuss budget numbers.
She was willing to give up health insurance and have her hours and wages cut, she said.
In addition, Norsten said she, Saastamoinen and Swanson were seeing a positive change in foot traffic.
“Our numbers are going up,” Norsten told the council. “If you get rid of two managers, you could get some yahoo in there next month who could belly the place out in five weeks. We’re the three icons of that liquor store; you are not going to find three women who are more honest and good as we are.”
Nash and Hansen said the liquor commission worked with Swanson to develop a revised deadline for the reorganization plan and the position changes.
Dahl made the motion to accept the liquor commission’s reorganization plan, which passed on a 5-0 council vote.
Nelson said Saastamoinen and Norsten would be able to reapply for the assistant store manager position after Aug. 15.
“We need to post the position at the liquor store so all the employees know the position is open,” she said.
Tim Hennagir is at email@example.com