Consumers Headed Back to the Bar, Technomic Reports

Alcohol purchases are expected to increase 1.9 percent next year, reports Technomic.

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Consumers are expected to increase their purchases of alcohol in bars and restaurants in 2011, with a forecasted uptick of 1.9 percent, Technomic, a Chicago-based foodservice research firm. Citing an improving sales climate at the nation's eating and drinking establishments, Technomic notes that consumers are beginning to order more drinks as they entertain away from home.

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"The past several years were brutal for the alcohol category in bars and restaurants. Consumers were trading down to value offerings or simply not ordering alcohol at all," said David Henkes, Technomic vice president and head of the firm's On-Premise practice. "As conditions improve, we expect to see positive sales growth in 2011."

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Despite positive growth forecasts, however, Henkes cautions that the industry still has a ways to go. "While a positive forecast is good news for bars and restaurants, the fact is that we're comparing 2011 to a very weak year in 2010. There are still some longer-term structural issues in the economy, including unemployment, that tell us that the improvement in alcohol sales won't be as robust as it has been after previous downturns."

Spirits-based drinks will see the highest rate of growth in 2011 at 2.3 percent, with some return to more expensive cocktails and premium brands. Wine sales will increase by 1.4 percent but are being depressed by a move toward more wines-by-the-glass and lower-priced value wines. Beer sales are expected to grow 1.6 percent and will be supported by continued strength in the craft/microbrew beer category.

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