News/Blog

On-premise still weak but showed further signs of improvement in April 2013

FOR IMMEDIATE RELEASE

LEESBURG, VA (May 9, 2013)

According to GuestMetrics, food & beverage sales at table service restaurants and bars in April 2013 showed some continued improvement as we saw towards the end of 1Q13.  For the 4-week period ending April 21st, total dollar sales were up +0.6% compared to year ago vs. the -0.4% decline during the first quarter of 2013.  Based on data from GuestMetrics, all three on-premise segments showed improvement in the latest 4 weeks compared to 1Q13: casual dining sales were still in negative territory with a 3.3% sales decline but this was an improvement versus the 4.0% decline in 1Q13, fine dining moved further into positive territory at +3.8%, an acceleration from the +2.7% in 1Q13, and bars/nightclubs also moved further into positive territory at +1.4%, an improvement from the +0.3% in 1Q13.

“While on-premise was generally quite weak during the holiday season and the first half of 1Q13, our data indicates overall food & beverage sales showed some improvement in April, a positive sign for the sector as we head further into the year,” said Bill Pecoriello, CEO of GuestMetrics LLC. “Based on our data, on-premise alcohol volumes were still in negative year-over-year territory for the 4 weeks ending April 21st  at -2.2% but this was an improvement from the -3.4% during 1Q13.  Alcohol dollar sales were up 1.8% for the latest 4 weeks, a solid uptick from the -0.3% during the first quarter, as price/mix was up 4.0%, a step-up from the 3.1% increase during 1Q13.  Given there was incremental alcohol pricing during the most recent 4-week period compared to 1Q13, it was encouraging to see alcohol volumes nonetheless showed signs of recovery.”

“Looking at the alcohol categories, while April beer volumes were still negative with a 3.1% decline, this was an improvement from the 4.8% decline during 1Q13,” said Peter Reidhead, VP of Strategy and Insights at GuestMetrics. “Beer trends in April improved from 1Q13 in each of the three on-premise segments we track. Spirits volume was down 2.4%, an improvement from down 3.5% during 1Q13, driven by accelerating trends in fine dining and bars/nightclubs, but spirits volumes in casual restaurants remained weak.  Lastly, wine volume was up 1.5% during the most recent 4-week period, a slight improvement from being up 0.9% during 1Q13.  Wine volume growth was still quite soft in bars/nightclubs and casual restaurants in April, but saw an acceleration in fine dining restaurants.  Comparing the most recent 4-weeks vs. 1Q13, beer price/mix was up +3.9% vs. +3.6%, wine price/mix up +1.8 vs. -0.3%, and spirits price/mix up +4.0% vs. +3.1%.”

“Counteracting the incremental pricing in alcohol, however, was a slight moderation in food pricing, which is obviously important given food accounts for about 65% of total sales in the on-premise sector,” said Brian Barrett, President of GuestMetrics. “While food prices were up 2.6% during 1Q13, they then moderated to up 2.2% for the 4-week period.  The net result of the incremental pricing in alcohol and moderating pricing in food was a wash, with overall food & beverage pricing up +2.7% for the most recent 4-week period as well as 1Q13.  Given the majority of consumers are still under economic pressure and generally sensitive to price moves, we will continue to closely monitor the price/volume trade-off in the food and alcohol categories over the coming months.”

About GuestMetrics LLC

GuestMetrics, LLC is revolutionizing how the hospitality industry operates.  Despite the dawn of the Digital Age having begun more than three decades ago, the hospitality industry essentially functions the same way it did centuries before.  GuestMetrics has cracked the code by collecting billions of dollars in sales from tens of thousands of restaurants, and turning billions of raw transactions into intelligible data that is fundamentally transforming the business operations of everyone from the independently-owned bar/restaurant on the corner, to multi-national chains, to the food & beverage companies that supply them.  Please visit www.GuestMetrics.com for more information and to arrange for a free demonstration.