{"id":44904,"date":"2025-01-08T20:48:34","date_gmt":"2025-01-08T20:48:34","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/alcohol-warning-regulations-hit-struggling-restaurants-hard-heres-what-you-need-to-know\/"},"modified":"2025-01-08T20:48:34","modified_gmt":"2025-01-08T20:48:34","slug":"alcohol-warning-regulations-hit-struggling-restaurants-hard-heres-what-you-need-to-know","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/alcohol-warning-regulations-hit-struggling-restaurants-hard-heres-what-you-need-to-know\/","title":{"rendered":"Alcohol warning regulations hit struggling restaurants hard: here\u2019s what you need to know"},"content":{"rendered":"

(Originally posted on : Invezz )<\/b>
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For decades, alcohol sales have provided restaurants with high-margin income, often accounting for up to 30% of total revenue in fine dining. <\/p>\n

Unlike perishable food items, alcohol offers a longer shelf life and lower labor costs, making it a financial cornerstone for eateries.<\/p>\n

However, US Surgeon General Vivek Murthy\u2019s latest warning about alcohol as a preventable cause of cancer could amplify a growing shift in drinking habits, particularly among younger demographics. <\/p>\n

This has left restaurant owners grappling with the prospect of dwindling alcohol sales and exploring alternative strategies to stay afloat, according to a report by <\/a>The New York Times<\/a>. <\/em><\/p>\n

Gen Z and the \u2018sober curious\u2019 movement<\/h2>\n

The younger generation has already begun reshaping the beverage industry. <\/p>\n

Terms like \u201csober curious\u201d and \u201cCalifornia sober\u201d highlight Gen Z\u2019s inclination toward moderation or replacing alcohol with alternatives like cannabis. <\/p>\n

According to a September 2024 survey by Datassential, 32% of consumers who drink have cut back on alcohol consumption since the pandemic.<\/p>\n

This cultural shift compounds challenges for restaurants that rely heavily on alcohol sales. <\/p>\n

At Houston\u2019s Hugo Ortega restaurants, alcohol\u2019s contribution to revenue has dropped from 31.5% in 2015 to 27.5% last year, owner Tracy Vaught reported.<\/p>\n

\u201cIt doesn\u2019t seem like much, but it really makes a difference,\u201d she said.<\/p>\n

Nonalcoholic options step into the spotlight<\/h2>\n

To counter declining alcohol consumption, many restaurants are diversifying their beverage menus. <\/p>\n

At the Amway Grand Plaza Hotel in Michigan, nonalcoholic drinks now account for 15% of total beverage sales. <\/p>\n

High-quality mocktails, such as the $15 copa verde, have emerged as a profitable alternative.<\/p>\n

\u201cMargins for food have decreased so significantly over the last four years that without a solid beverage program, restaurants can\u2019t make it,\u201d said Kevin Gillespie, who owns Gunshow and the tasting menu restaurant N\u00e0dair. <\/p>\n

\u201cBut there are creative paths out of this,” he said. <\/p>\n

Gillespie said customers might not opt for alcohol but may still fancy a cocktail, and if a non-alcoholic cocktail can be done right, it can be priced almost at par with its alcoholic counterpart.<\/p>\n

A year ago, Ryan Schmied, director of food and beverage at the Amway Grand Plaza Hotel in Grand Rapids, Mich., made some changes after noticing a dip in sales of alcoholic beverages. <\/p>\n

No and low-alcoholic beer and wines were added and these cocktails without liquor have made a significant contribution to his profits.<\/p>\n

Drinks without alcohol now account for about 15% of all beverage sales at the restaurants and bars in the hotel. <\/p>\n

\u201cIt sounds like a small number, but 10 or 15 percent can make or break a place,\u201d he said.<\/p>\n

Alcohol helps restaurants deal with inflationary woes<\/h2>\n

Restaurants are also battling broader economic pressures. <\/p>\n

Rising costs for rent, labor, and ingredients have forced businesses to raise prices, but only to a limited extent. <\/p>\n

According to the National Restaurant Association, sales dipped 1.7% between November 2023 and November 2024, as inflation-weary consumers cut back on dining out.<\/p>\n

In New York City, Chase Sinzer, co-owner of Claud and Penny restaurants, described alcohol as essential to financial survival as it can act as buffer against rising food prices. <\/p>\n

The idea is that customers are more flexible in their choice to spend on alcohol, as compared to food.<\/p>\n

\u201cThey\u2019ll say, \u2018I\u2019m paying this much for a piece of chicken?\u2019\u201d Sinzer said. <\/p>\n

\u201cWhen chicken costs 75% more than it used to and we can only raise the price 25%, you\u2019d better sell some booze. No one spends more on chicken than the next table, but people make different choices about alcohol.\u201d<\/p>\n

A long-term change or a minor blip in consumption?<\/h2>\n

Not all restaurants are experiencing a decline though.<\/p>\n

Union Square Hospitality Group\u2019s fine dining venues report steady alcohol sales, with a growing interest in lower-alcohol wines. <\/p>\n

John Ragan, president of the hospitality group recalls how when “60 Minutes” aired a segment in 1991 suggesting red wine was the reason the French had a low incidence of heart disease despite their high consumption of fat, sales of red wine jumped.<\/p>\n

Similarly, he said, the surgeon general’s warning may cause some minor changes, but it is unlikely it will change the drinking habits of customers significantly. He said,<\/p>\n

There might be some ebbs and flows, but I think whatever your favorite pairing is at the table I don\u2019t perceive changing in a big way.<\/p>\n

While some restaurants brace for change, others are finding opportunities to adapt. <\/p>\n

Specialty cocktails featuring rare and premium liquors, such as Beyonc\u00e9\u2019s SirDavis American Whisky, remain in demand, as noted by Deborah VanTrece of Atlanta\u2019s Twisted Soul Cookhouse & Pours.<\/p>\n

Still, restaurant owners acknowledge the risks. <\/p>\n

If the surgeon general\u2019s warnings gain traction and Gen Z\u2019s drinking habits persist, alcohol\u2019s role in restaurant profitability could diminish further.<\/p>\n

\u201cFor the most part, right now we feel steady,\u201d she said, \u201cbut people will at some point generally jump on a bandwagon, so I\u2019m not saying it\u2019s not coming,” VanTrece says. <\/p>\n

The post Alcohol warning regulations hit struggling restaurants hard: here\u2019s what you need to know<\/a> appeared first on Invezz<\/a><\/p>\n

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(Originally posted on : Invezz ) For decades, alcohol sales have provided restaurants with high-margin income, often accounting for up to 30% of total revenue in fine dining. Unlike perishable food items, alcohol offers a longer shelf life and lower labor costs, making it a financial cornerstone for eateries. However, US Surgeon General Vivek Murthy\u2019s […]<\/p>\n","protected":false},"author":3947362359,"featured_media":44905,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[37],"tags":[],"_links":{"self":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/44904"}],"collection":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/users\/3947362359"}],"replies":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/comments?post=44904"}],"version-history":[{"count":0,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/44904\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media\/44905"}],"wp:attachment":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media?parent=44904"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/categories?post=44904"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/tags?post=44904"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}