Applying Macro-Trends to Boost Bar Margins This Summer

By Lori Bolin, President and Chief Strategy Officer at BrewLogix

 

Warmer weather brings about change in the hospitality industry as consumer behavior and beverage preferences shift from “colder weather trends” to “warmer weather trends”. Savvy bar, taproom, and restaurant managers can examine these trends to increase margins and serve-up a successful summer beverage program.

At BrewLogix, we analyzed nearly a billion ounces of  on-premise draft depletions to identify macro-trends within the U.S. that could have relevance to most on-premise bars and restaurants this summer. Applying learning from these trends, however, is very local and specific to you and your customers. 

Here are a few insights we’ve gleaned from our data that you can use to boost your margins this summer:

As weather moves from “colder” to “warmer”, macro trends form in two significant areas: ABV & Flavor Note Preferences – which then typically impact how throughput is dispersed throughout the draft program. For example:

Applying Macro-Trends to Boost Bar Margins This Summer
ABV: The percentage of throughput derived from higher ABV beverages decreases as colder weather decreases, while the percentage of throughput derived from lower ABV beverages increases as warmer weather increases. NOTABLE: In 2023, low-to-no ABV beverages are projected to make up an even greater portion of on-premise depletions as we progress into the summer.

 

Applying Macro-Trends to Boost Bar Margins This Summer
Flavor Notes: The percentage of throughput derived from darker, richer, creamier, smokier, and roasted flavor notes decreases as colder weather decreases, while the percentage of throughput derived from lighter, crisper, more refreshing flavor notes increases as warmer weather increases.

 

Additionally, we see a shift in throughput percentage from year-round “top sellers” compared to “all other taps”. For many bars and restaurants, we often see year-round favorites that make up the top two-three draft products. As summer approaches, these products may remain in top positions, but their collective throughput is a smaller % of the whole while “all other taps” increase in their contribution to the throughput pie – and if designed properly, can be a key to boosting margins.

How can you apply these macro trends to boost your summer draft program? 

First, let’s look at how consumer behavior changes as the weather gets warmer:

  • Social groups increase in size. As weather gets warmer, more people say “yes” to the dinner invite, the drinks after work, the Saturday bike ride to brewery tap rooms… In general, meet-ups are larger and (notably) more people have a say in where they go to find the menu options that make everybody happy.
  • Social groups expand in age and drinking preferences. As cold weather dissipates, social groups stretch the edges of their inclusion. “Everybody’s welcome!” is the rallying cry with the sober-curious, the cocktail savvy, the health-crazed, and the Cicerone trained craft beer nerd all equally expecting a great experience at your bar.
  • Beverage consumers are looking for more variety – especially in the summer. While craft beverage consumers have long been known for their willingness to try almost anything… in the summer, the average beverage consumer is seeking out “what’s new” with greater intentionality.

Now, here are a few suggestions to increase throughput and margins:

    • Beverage Mix/Local Agility. Forge relationships with your local craft breweries and distilleries to stay up to date on new offerings, highlighting products from the community. Encourage your local brewers to make you aware of their top-performing summer brews with popular summer flavor notes. Explore cideries and kombucha brewers in your area who are innovating fruit-forward flavors for the summer with a range of ABV levels that expand your “other taps” with increasing throughput potential. Remember, there’s great opportunity with this segment of your draft program as seasonal products and small-batch premium offerings can delight customers while positively impacting your margins.
    • Social Media Marketing. Use your social media and your outbound email blasts to promote your range of beverage options and your new products on tap. Even if you’re a full service restaurant, during the summer, refreshing beverages are an attractive draw to bring in traffic and maximize ticket averages. 
  • Beverage Menu. If your menu is designed for the beer nerd, you may want to consider re-organizing the beverage menu for the summer to speak to a broader customer base. For example, consider organizing by category features like, “What’s New!” “Trending Styles” “Summer Hits” “Low-to-No Alcohol” or even a “just for you” section for the vegan, the gluten-free-er, and the abstainer, with premium products curated just for them. You may find increased loyalty and increased margins by meeting the summer guest in their summer mindset. 
  • Operations. Consider offering kegged cocktails (both with and without alcohol) to increase efficiency and consistency while boosting margins.
  • Staff Knowledge & Feedback. A well-trained staff that can advise customers on beverage choices with efficient ease will improve the guest experience and lead to add-on and upsells that create wins for everyone. Gaining your FoH team’s feedback about guest beverage requests and comments will also keep your draft program well-tuned to customer preferences. If you are looking for a simple way to improve your team’s knowledge of draft products, explore BreweryDB.com – a great source of free, straight-from-the-brewer “BrewKnowledge” that is easy to absorb. 

A shift from “colder weather” to “warmer weather” can help you heat-up your beverage program’s profitability. Let consumer behavior and changing beverage preferences inspire your plans for a successful summer! Cheers!

 

Lori Bolin, Bio

Website | LinkedIn

Lori Bolin is the President and Chief Strategy Officer for BrewLogix, a technology solutions company influencing the next trajectory of growth in the beverage hospitality and craft brew industries. The company uses the unique insights of cloud-powered and Internet of Things (IoT) technology to help bars, restaurants, taprooms, and breweries elevate customer and staff experiences that drive profitability and brand loyalty. Lori serves as the visionary for the BrewLogix ecosystem and is the primary product consultant for the company’s newly released Performance Platform designed specifically for the on premise environment. In addition to her passionate work in the hospitality industry, Ms. Bolin is the owner of a private consulting firm that focuses on creating competitive advantage for small-to-mid-market businesses through strategic innovation. She is also co-owner of Crossroads Kombucha, a craft kombucha brewery in the Midwest. She is a Certified Beer Server in the Cicerone® Program and has served as a judge with Kombucha Brewers International.