Drink sales remain vital to a restaurant’s success despite stagnant growth

December 21 2017

There’s new research backing up how relevant drink sales are to the success of a restaurant.

Revenue generated by drinks remains a dynamic and important part of the restaurant and bar business, but pushing on and growing this aspect continues to be a challenge for operators and brand marketers alike.

That’s one of the claims stated in a new report issued by food industry research group Technomic with the help of the Beverage Marketing Corporation.

It blamed slowed consumer traffic at on-premise locations for restricting growth, as well as stagnancy in special occasions involving adult beverages. Both have resulted in flat total alcohol sales volume in restaurants and bars in 2017.

Growth flat but revenue up

The report found that adult beverages continue to evolve, with spirits outpacing beer in volume growth, while the amount of wine being sold in bars and restaurants declined for the fourth year running.

Bars and restaurants may be struggling to sell more drinks, but the amount of money they pull in is expected to rise by 2.1 percent in 2017, largely thanks to inflated drink prices and the continued growth of premium bar products.

It adds that the appeal of differentiated and flavorful adult beverages and the importance of supplier support is seen in the roster of fastest-growing brands on-premise, led by Tito’s Handmade Vodka.

What’s hot?

Bars and restaurants looking to develop alcohol sales should look to aged spirits, such as whiskey, brandy, cognac and aged rum, which has enjoyed growth recently. In contrast, vodka volume has dropped slightly.

Eric Schmidt, director of alcohol research at the Beverage Marketing Corporation, revealed that imports and craft beers are gaining share, thanks in part to Mexican brands and smaller craft labels.

“We are tracking mixed results from leading domestic table wine brands, while imported sparkling wine continues to find relevance at the bar,” he commented.

Read more: Five food and drink trends you could see in 2018

Volume growth may be elusive but diners consider drinks to be an important aspect of going out, Technomic’s associate principal Donna Hood Crecca added.

She explained that consumers prioritize adult beverages, with a third of all consumers and half of those aged 21 to 34 saying that drink offering influences their decision of where to go.

“Today, consumers have more choices, as venues ranging from sports stadiums to winery and brewery tasting rooms are in the consideration set, which raises the bar for traditional locations like restaurants,” Ms Hood Crecca explained.

“Improving and differentiating the drink experience is key to success.”

With increased interest in spirits, the time is right to introduce a few new cocktails to your bar menu.

You can find many innovative and delightful cocktails in Clubhouse For Chefs’ beverages section such as the carmelized pineapple & mezcal margarita and coconut foam pina colada. There’s even the odd intriguing milkshake and smoothie too.

Photo: LauriPatterson/iStock