Flat is the New Up
While nightclubs and bars originally were forecasted to end 2009 with 0.5 percent growth by hospitality market research firm Technomic, the segment is now expected to be flat. Technomic recently revised its 2009 forecast downward, according to David Henkes, vice president and on-premise practice leader for the Chicago-based firm. Beverage alcohol sales in nightclubs and bars are expected to be down 1.1 percent for the year.
The good news is that the nightclub and bar segment is faring better than other segments of the hospitality industry in this challenging economic climate. With consumers reducing their dining out frequency and ordering differently in order to reduce check sizes, Technomic projects the overall industry to decline 8.2 percent on food and beverage this year, and to be down 5.5 percent for beverage alcohol sales. Fine dining and lodging are anticipated to be the hardest hit on F&B and are forecasted to end 2009 down 16 percent and 12 percent, respectively, on total F&B sales and to experience 19.6 percent and 11.4 percent declines, respectively, on beverage alcohol sales. Casual dining is expected to finish the year with an 8 percent decline in F&B sales and 9.9 percent drop in drink sales.
Beer sales in total on-premise establishments should end 2009 down 4.6 percent; spirits down 5.0 percent and wine down 9.9 percent. Again, nightclubs and bars are feeling the least pain, with wine expected to be flat, beer sliding 1.5 percent and spirits ending 2009 down 1.0 percent.