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


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.”

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