Casual restaurants not adequately leveraging the strength in craft beers.

Casual restaurants are not doing as effective a job as fine dining restaurants or bars in leveraging the growth in craft beers Pricing at casual restaurants can also be higher through improved brand mix, promotional levels and price points.
Feb. 28, 2013 - PRLog -- LEESBURG, Va. -- According to GuestMetrics, based on its POS database of over $8 billion in sales, casual restaurants appear not to be leveraging the strength of craft beers as well as fine dining restaurants and bars.

“On pretty much every dimension, casual restaurants are not doing as effective a job as fine dining restaurants or bars in leveraging the growth in craft beers,” said Bill Pecoriello, CEO of GuestMetrics LLC. “Based on our data, craft beers accounted for 20% of beer sales in casual restaurants, versus the 22% in bars and 28% in fine dining restaurants.  Additionally, the average price being charged by casual restaurants for craft beers is only $5.09, compared to $5.53 in bars and $6.16 in fine dining restaurants.  This is a function of differences in brand mix, promotional levels and as well as pricing architecture across the sub-channels. While it may not be feasible for casual restaurants to charge the same amount as fine dining, there should be room for closing the price gap relative to what bars are realizing.”  

“In further analyzing the beer category within the different on-premise segments, while craft beers achieved a 7% growth in casual restaurants in 2012 relative to the prior year, this lagged behind the 11% growth in bars and 13% growth in fine dining restaurants,” said Peter Reidhead, VP of Strategy and Insights at GuestMetrics.  “While casual restaurants obviously need to have a balanced offering in the beers they carry, we believe there could be a positive halo effect on overall beer sales from dialing up their focus on craft beers.”

“In addition to having a lower share of beer sales and slower growth from craft beers, casual restaurants appear to be leaving additional money on the table by not keeping pace with the price increases in craft beer,” said Brian Barrett, President of GuestMetrics. “While the average price of craft beers in fine dining restaurants and bars increased more than 3% in 2012 relative to the prior year, craft beer pricing in casual restaurants only increased 2%.  Given the tight economics being experienced by casual restaurants right now, optimizing the brand mix, discount levels and pricing architecture within the beer category are key to improving revenue trends.”      

About GuestMetrics LLC

GuestMetrics, LLC is revolutionizing how the hospitality industry operates.  Despite the dawn of the Digital Age having begun more than three decades ago, the hospitality industry essentially functions the same way it did centuries before.  GuestMetrics has cracked the code by collecting $8 billion dollars in sales from over 250 million checks from tens of thousands of restaurants, and turning billions of raw transactions into intelligible data that is fundamentally transforming the business operations of everyone from the independently-owned bar/restaurant on the corner, to multi-national chains, to the food & beverage companies that supply them.  Please visit for more information and to arrange for a free demonstration.
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Tags:Craft Beer, Restaurants, On-premise, Bars, Alcohol, Beverages, Market Research
Industry:Restaurants, Business, Food
Location:Leesburg - Virginia - United States
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