Optimizing Your Beverage Program

Alcoholic beverage sales have long been a prime consideration for successful restaurant operators but, for much of the industry’s history, beverage has taken a backseat to food. Those days are gone.

The Importance of Optimizing Your Beverage Program

Beverage sales account for about 25 to 30 percent of overall sales. According to Restaurant Informer, that percentage can rise to 40 to 50 percent in establishments with a solid beverage program. When you consider that food costs usually fall into the 28 to 35 percent range, while liquor can come in as low as 18 percent, it’s clear why developing this program is vital to a successful venture.

Here are the steps operators have adopted to develop top-of-the-line beverage programs.

Stand out from the Crowd—Your Beverage Menu

Entertain & Inspire. Innovative, authentic, and true to one’s brand are the cornerstones of a successful beverage program. Signature drinks are just that—original, like one’s signature, and represent the best a brand has to offer.

When developing a menu, consider local ingredients, customs and habits of your local clientele, and stories that coincide with a particular brand.

Mezcal, for example, comes from the maguey, an agave plant that takes 7 to 30 years to mature. The 30 different species used to make the agave-based liquor all have a unique flavor, from fruity to earthy.

Restaurants leaning toward Greek fare may want to share the story about the Katsou sisters and their family distillery on the island of Evia in the Aegean Sea. Their Grace Gin is made with the local botanicals that include myrtle, critamos, and skinos.

These types of stories intrigue and entertain your guests, as well as inspire tastings.

Whole Fresh Foods. Consumers are increasing their desire for fresh, healthy foods. L.E.K. Consulting’s Food and Beverage Survey found that 93 percent of consumers want to eat healthily at least some of the time and 63 percent are trying to eat healthily most or all of the time. Adding fresh garnishes including fruits, herbs, and vegetables appeals to health-conscious clientele. Some trending garnishes include ginger, basil, rosemary, sage, and turmeric.

Target Market. Of course, knowing your clientele is the top priority. Will your guests appreciate the detail that went into creating the Honey Badger Blitz, or would they rather share a round of craft beer?

If in the right niche, craft cocktails not only add value to your guests, they add profit to your bottom line. Bars and restaurants are charging anywhere from $10 to $20 for these types of drinks. Just as with each item on the menu, it’s important to cost every item that goes into your drinks and price accordingly.

The Vessel. While it’s apparent that drinks need that wow flavor factor, bar managers do not always consider the container that holds these flavors, many of which can increase sales. Beer flights, for instance, increase profits, offer guests the opportunity to discover new favorites, and enable an establishment to pair small plates or appetizers with the different varieties.

Pairing Drinks with Food.

Increase sales while ensuring guest satisfaction by leveraging the combined power of food and beverages. When creating your beverage menu, consider how the drinks will complement your food. Pairings add a level of enticement—teaching guests while entertaining them and improving their experience. Bar managers and chefs can work together to develop specific pairings. If you don’t have the expertise in-house, consider hiring a beverage consultant.

Don’t Forget Non-Alcoholic Beverages

No- and low-proof beverages have become an important part of the bar menu with sales of non-alcoholic beverages expected to increase by over 7 percent annually.

Zero-proof cocktails include non-alcoholic gins, whiskeys, and sparkling beverages. Seedlip offers “the world’s first distilled non-alcoholic spirits.” Their Seedlip Spice 94 combines the natural botanical distillates and extracts of allspice berries, cardamom, grapefruit, lemon, oak, and cascarilla bark to create a unique drink that guests looking for spirit-free drinks will enjoy and remember.

Light, refreshing, low-alcohol spritzes are also important considerations.

A Best-in-Class Beverage Program Doesn’t Have to be Complicated

Doug Radkey, the author of Bar Hacks, created a beverage menu that contained the following: five signature cocktails, eight local beers on tap, four red and white wines, three hand-crafted mocktails, one dessert cocktail, and seven canned beverages. Not too complicated, targeted to the right clientele, and profitable—that’s a successful beverage program.

The end of 2019 saw Charlie Deal, managing member and wine director of Juju, Jujube, and Dos Perros restaurants, simplifying a wine, beer, and sake program that had become overly complicated. The end result had been excessive, unused inventory. Nation’s Restaurant News reported Deal as saying, “By focusing on moving product and positioning them appropriately, immediately our numbers improved drastically.”

You’ll find many profitable beverage programs are leaning away from over-the-top 10-plus outrageous ingredients to classic cocktails with an innovative twist that requires just 3 to 5 ingredients.

According to Foodable, drinks that take longer than 90 seconds to prepare can become a problem for venues and consumers.

Educating Staff

Education is a critical key in the success, or failure, of a beverage program. And the knowledge required includes more than the best pairing practices. Guests want to be engaged and inspired—hear the stories behind the brands and the variances between brands. Training should include this information as well as service protocol, taste tests, and speed and consistency when preparing drinks.

Tipzyy, a mobile software program developed for both educating and incentivizing servers and bartenders, offers the opportunity for staff to increase their knowledge as well as their check averages. Guests appreciate suggestions, and operators value the ability to promote high-margin products.

Beverage Marketing Program

Don’t forget to take advantage of a beverage marketing program. Beverage marketing funds may be available through suppliers and can be used to promote, educate, and optimize a beverage program. There are several federal and state laws that determine how these funds can be used, so be sure to investigate before accepting.

In addition to knowing what your competitors are serving and what drinks are trending, distributors and sales reps may know what brands are offering marketing funds and any regulations that may prohibit and determine their use.

Restaurants Making the Grade

The Melting Pot Restaurants, Inc, a 110-unit brand known for its premier fondue, was awarded the 2019 Cheers BevX Award for Best Overall Beverage Program and the 2019 VIBE VISTA Award for Best Beverage Limited Time Offer.

How did they do it?

Paul Brown, their Beverage Manager, told Globe Newswire, “As part of The Melting Pot brand evolution, I created enhanced, fresh, clean and simple Best in Glass cocktails, along with unique shareable porthole and barrel cocktails, and spirit-free beverages.”

He ensured the cocktails authenticity by studying the best—traveling to the Kentucky Bourbon Trail and the Pendennis Club as well as the Beam (of Jim Beam) Innovation Center. The Best in Glass cocktails include the Original and Modern Old Fashions, The Melting Pot Mule, the Freshly Picked Margarita, The Authentic Mai Tai, and a spirit-free beverage—The Bee’s Tea.

They also pair their popular dessert fondues with after-dinner beverages.

The commitment to their beverage program is evident by the hands-on process and the extent they’re willing to go to develop a program and attend to every detail. Study your target market, stay true to your brand, and take your time to develop a beverage program that will enthuse your guests and increase your profits. And a trip to the Kentucky Bourbon Trail may not be such a bad idea.

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