Promising on-Premise Sales
By ELIZABETH FUHRMAN
New products and healthier options dominate dining
Eating out is in. With people living most of their lives away from home,
the typical American consumer now spends almost 47 percent of his or her
food dollar in restaurants. This opens the door to on-premise beverages,
which represent sales in everything from restaurants to nightclubs to
Restaurant-industry sales are projected to reach a
record $475.8 billion in 2005, an increase of 4.9 percent over last year,
says the National Restaurant Association (NRA), Washington D.C.
Full-service restaurant sales are forecast to reach $16.5 billion in 2005,
an increase of 5 percent from 2004. Sales at quick-service restaurants are
expected to reach $134.2 billion in 2005, an increase of 4.7 from last
year. In turn, restaurant and other foodservice operators are expected to
buy $73.7 billion in food and drink from industry suppliers in 2005.
As consumers continue to focus on health and diet
issues, restaurants of every kind are adjusting their menus to offer
healthier choices. For example, quick-service operators saw the greatest
increase of popularity in entrée salads, with 79 percent reporting
to the NRA they saw an increase in interest, followed second by bottled
water with 69 percent. Twenty-eight percent of operators also reported an
increase in popularity of iced tea and 25 percent reported growing interest
in fruit juice.
Wine continues to grow in popularity at full-service
restaurants, with more than half of casual-dining and family-dining
restaurants and three-quarters of fine-dining restaurants, reporting that
customers are purchasing more wine than two years ago, the NRA says. Both
full-service and quick-service operators say bottled water, specialty
coffees and iced teas are growing in popularity as well.
Demonstrating the health trend in restaurants, U.S.
bottled water sales and consumption continue to rise, offering stiff
competition for carbonated beverages and healthy alternatives. In 2004,
bottled water volume increased to nearly 6.8 billion gallons, an 8.6
percent gain over 2003, and grew to a per capita consumption level of 23.8
gallons, compared to 22.1 gallons the previous year, according to the
International Bottled Water Association, Alexandria, Va.
Still, more than one in five soft drinks sold
domestically come from a soda fountain. Fountain sales have been a faster
growing market than bottles and cans for the past few years, with profit
margins capable of running 90 percent.
New products seem to be where soft drink companies are
finding their edge and sparking consumer interest. Last year, PepsiCo Inc.
partnered with Taco Bell, a unit of Yum Brands Inc., and began selling
Mountain Dew Baja Blast, a turquoise-green soda with a lime flavor,
exclusively at its restaurants. Taco Bell generates two-thirds of its
business at its drive-through windows with an ever-growing late-night
crowd. But the company realized that its customers were going home to grab
a drink from the fridge, so it created a new product to attract consumers.
Taco Bell expects to sell more than one million gallons of the exclusive
beverage, the company says.
The Coca-Cola Co., Atlanta, continues to expand its
beverage portfolio, giving consumers – even dieters and health
conscious consumers – a variety of options and flavors from which to
chose. Marketed toward young adults and available in June, Coca-Cola Zero
offers zero calories and sugar and will be supported by an extensive
marketing campaign. Coca-Cola’s seventh addition to the Diet Coke
family, Diet Coke Sweetened with Splenda offers Diet Coke drinkers the
taste of Splenda.
Coca-Cola also will be launching a signature beverage
program with the Culinary Institute of America that helps restaurant
operators create recipes using Coca-Cola to create their own unique
Restaurant industry at a glance
Restaurant-industry sales are forecast to reach a
record $475.8 billion in 2005 – an increase of 4.9 percent over
Sales at full-service restaurants
are projected to reach $164.8 billion this
year, an increase of 5 percent from last year. Sales at quick-
restaurants are expected to reach $134.2 billion in 2005, an increase of
4.7 percent over last year.
On a typical day in 2005, the restaurant industry will
post average sales of more than $1.3 billion.
The restaurant industry’s sales equal 4
the U.S. gross domestic product.
Foodservice operations within commercial restaurants account
for approximately $437 billion of the
industry’s anticipated 2005 sales.
Source: National Restaurant Association
Spirits take flight
With growing interest in
spirits and the desire to provide customers with quality unique beverages,
the chef and owner of Two Chefs in South Miami, Jan Jorgensen, formed the
largest back bar and whiskey collection in the Southeastern United States
with more than 400 spirits products. To promote the collection and tempt
customers to try new spirits, Two Chefs began offering a Spirits Take
Flight series for $15 per person. Participants partake in a personalized
flight of liquor – flights are selected on the customer’s
personal preferences and experience – as well as individually
selected food bites that complement the particular spirits being tasted.
“We plan on spending some individual time with
the client and get a feel for what they like to eat,” Jorgensen says.
“It will mainly be a bar promotion where you talk to a client and
introduce them to 50 vodkas and then narrow it down to 10 and then
eventually narrow it down to three so they can taste based on what their
taste buds will accept.”
The Spirits Take Flight series features a different
spirit every two weeks, such as tequilas, vodkas, rums, gins, brandies,
whiskeys, ports and cognacs, and also offers customers a chance to try
families of brands such as Macallan, Balvenie, Dalmore and Chieftans
“Most of these spirits you are so used to going
into a bar and saying, ‘Give me a Grey Goose Cosmopolitan.’ or
‘Give me a Johnny Walker Black.’ for example,” Jorgensen
says. “A lot of people don’t open themselves up to other
spirits because they are so used to calling this one brand. We figured
since we have so many choices, let’s introduce them.”