Out-of-Home Alcohol Sales Set to Rise

July 21, 2010

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Analytics, Automated & MarTech | CPG & FMCG | Data-driven | Financial Services | Food & Restaurants | Retail & E-Commerce

A positive sales trend from casinos and bars should drive a rebound in US out-of-home alcohol sales during 2010, according to new figures from Technomic.

Out-of-Home Alcohol Sales Pick Up
Technomic has revised its forecast for sales of beverage alcohol sold away from home upward. Technomic now expects beverage alcohol sold in bars, restaurants and other on-premise establishments to grow by 1.1% this year, up from the decline of 2.5% forecasted at the end of 2009.

Bars, Casinos Lead Growth
Broken down by type of premise, the strongest 2010 growth in out-of-home alcohol sales is expected to occur in bars and nightclubs (2.1%) and casinos (also 2.1%). In addition, out-of-home alcohol sales are predicted to increase 1.3% in both lodging and concessions, and 1.1% in fine dining.


The casual dining segment is the one niche expected to post negative growth (-5%) in out-of-home alcohol sales this year. “Consumers are returning to restaurants, and that’s good news for the sales of alcohol and related products,” said Technomic VP David Henkes.

Spirits Prove Popular
Looking at projected out-of-home sales growth of different types of alcohol, spirits are poised to grow at the most rapid rate (1.6%), followed by beer (1.2%). Out-of-home sales of wine, however, are forecast to slightly decline at a rate of -0.6%.


Full Recovery Not Here Yet
Alcohol sales will still slightly lag behind broader restaurant and bar sales, and the industry is not expected to fully recover from the economic downturn for at least another year.

“While it’s good news that we’re starting to see growth after nearly two years of declines, the industry is not out of dangerous territory yet, and the recovery isn’t as robust as it has been in previous recessions,” said Henkes, who advises that alcohol should be an area of focus for operators given its higher profitability.

Consumers Favor Cheaper Liquor
U.S. consumers consumed a slightly higher quantity of liquor in 2009 as compared to 2008, but traded down on quality, according to a recent study from the Distilled Spirits Council.

Liquor sales by volume grew 1.4% between 2008 and 2009, but liquor revenues remained flat at $18.7 billion in 2009. Despite this leveling off, liquor revenues grew 66% between 2000, when they totaled $11.7 billion, and 2009. Average yearly volume growth was 5.2% in that period.


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