Off-premises alcohol sales have become a key revenue generator for restaurant operators across a variety of segments. One fast-casual chain looks at expanding its automated kitchens. Lots of third-party delivery-related news. Plus, an iconic Chicago food manufacturer gets back into the restaurant business.
Being able to sell alcohol to go has gone from a survival tactic operators used to navigate the pandemic to an operational imperative for many restaurants.
In fact, among restaurant operators that offer alcoholic beverages with takeout or delivery orders, roughly 90% offer it with takeout orders, per a study from the National Restaurant Association. The NRA reports that alcohol-to-go sales accounts for an average of 21% of sales among full-service restaurants.
Casual dining leads the way in off-premises options, with 90% of restaurants that serve alcohol including it as a takeout offering. In addition, 26% of casual dining restaurants that offer alcohol to go make it available as part of their third-party delivery offerings. When it comes to who wants to-go alcohol, millennials (62%) and Gen Z adults (52%) report they would be more likely to pick a restaurant for takeout if they could include alcoholic beverages.
Other key data points from the NRA’s study include:
- 54% of delivery customers say the availability of alcoholic beverages would make them more likely to choose a restaurant.
- Both wine (81%) and beer (79%) drinkers say they would participate in tasting events at restaurants.
- 82% of adults that drink wine, beer and liquor say they trust the staff at local restaurants to make good drink recommendations.
Editor’s note: It’s important to point out that everyone surveyed for the study was more than 21 years old, per the NRA.
This Week in Foodservice
- In a sign of how competitive the third-party restaurant delivery business is these days, Grubhub laid off 400 corporate employees, the company announced. This equates to about 15% of its workforce. The company says these moves were necessary to remain competitive. Grubhub has struggled to capture market share and trails such competitors as Uber Eats and Door Dash, per a CNBC report.
- New York City will set the minimum wage for app-based delivery workers at $17.96 on July 12, per a Restaurant Dive report. The wage will rise to $19.96 on April 1, 2025.The implementation of the wage floor comes three months after the city’s Department of Consumer and Worker Protection cut its proposal for the wage from $23.82 an hour to $19.96 an hour. The reduction was preceded by vocal industry opposition.
- Is third-party delivery the future of hotel room service? Perhaps. For years hotels have struggled to find ways to provide quality room service options at price points that not only appeal to consumers but also make financial sense for the operator. Grubhub has partnered with Homewood Suites by Hilton to provide off-premise food options for guests through its app at about 500 locations around the country, Restaurant Dive reports. Homewood Suites guests that don’t have any onsite dining options will be able to place orders from local eateries and convenience stores on Grubhub via geolocation and QR codes around their hotel that link to Grubhub’s Marketplace.
- Vienna Beef is getting back into the restaurant business. The iconic Chicago hot dog maker plans to redevelop its former factory location on the city’s Northside into Vienna Beef Plaza. The reimagined space, measuring 150,000 square feet, will include a Vienna Beef restaurant, an outdoor plaza, other retailers and office space. Vienna Beef plans to open the restaurant in Spring 2024.
- Will all sweetgreen kitchens be automated in five years? Don’t rule it out, according to Jonathan Neman, the chain’s CEO. What’s fueling such optimism? The fact that the chain’s testing of its Infinite Kitchen concept is going so well, per a report in Restaurant Business. The chain is looking at the performance of this test in terms of the guest experience as well as unit economics. The robotic system is faster and more accurate. Further, it’s had a positive impact on employment.
- Restaurant franchising stalwart Flynn Restaurant Group will acquire Pizza Hut Australia. This will represent Flynn’s first international acquisition, per a Bloomberg report. Flynn is buying the Australia franchising license from Sydney‑based private investment firm Allegro Funds and will add 260 Pizza Hut restaurants in the country to its lineup. San Francisco-based Flynn already owns 945 Pizza Huts in its home market. The acquisition will give Flynn about 2,600 locations across the two countries and boost annual sales to roughly $4.5 billion from $4.2 billion.
- Todd Graeve, CEO of Nebraska-based Scooter’s Coffee, was named an Entrepreneur of the Year 2023 Heartland Award Winner. This award recognizes business leaders “who have transformed their industries and driven company success.” Graeve is now eligible for consideration for the Entrepreneur Of The Year 2023 National Awards in November at the Strategic Growth Forum.
- The operator of a now-shuttered restaurant in New York City faces a possible jail sentence of up to 30 years and a fine of $1.3 million after pleading guilty to defrauding the federal government of $3.2 million in federal COVID-19 aid, per a Restaurant Business report. Donald Finley admitted in federal court that he used the proceeds from 29 Paycheck Protection Program (PPP) and Emergency Injury Disaster Loan Program (EIDLP) loans for personal expenses, including the purchase of a house in the Massachusetts resort of Nantucket.
Economic News This Week
- The Consumer Price Index rose 0.1% in May on a seasonally adjusted basis, after increasing 0.4% in April, the U.S. Bureau of Labor Statistics reported. Over the last 12 months, the all-items index increased 4.0% before seasonal adjustment. The index for shelter was the largest contributor to the monthly all-items increase. The food index increased 0.2% in May after being unchanged in the previous 2 months. The index for food at home rose 0.1% over the month while the index for food away from home rose 0.5%.
- Consumer credit increased at a seasonally adjusted annual rate of 5.7% in April, per the U.S. Federal Reserve. Revolving credit increased at an annual rate of 13.1%, while nonrevolving credit increased at an annual rate of 3.2%. This was the fastest rate consumer credit grew in five months, per published reports.
- Initial jobless claims totaled 261,000 for the week ending June 3, per the U.S. Department of Labor. This represents an increase of 28,000 from the previous week. It also represents the highest level for initial claims since October 30, 2021, when it was 264,000. The 4-week moving average was 237,250, an increase of 7,500 from the previous week. While the jump in claims is something to monitor, some economists feel it’s too early to jump to any conclusions given the ongoing volatility of the job market, per a Reuters report.