Restaurant and Bar Volatility Persists

On-premise recovery has been driven by the uptick in takeout and delivery of food.

December 15, 2021

Restaurant Bar

CHICAGO—Restaurants and bars remain highly volatile both nationally and on a regional basis, according to IRI research, which showed vast differences in spending on food and beverage on premise.

Across U.S. casual and fine dining data, the total menu spend averaged on a per-venue basis totaled $679,000 in the third quarter of 2021, almost reaching pre-COVID-19 spending levels of $690,000 in the third quarter of 2019.

“This data tells part of the story about strong areas for on-premise food and beverage consumption on a quarter-by-quarter basis,” said Boris Oglesby, executive vice president and practice leader for alcohol beverage and tobacco, IRI. “However, there are many nuanced, often non-intuitive trends that indicate pockets of opportunity for brands.”

The average California region spend far exceeded the rest of the nation at $918,000 per venue. With its less-dense population, lower cost of living and colder climate, the Plains region shows the lowest average spend of $497,000 for the quarter. 

IRI says that recovery has been driven by the uptick in takeout and delivery of food, with consumer purchases of take-out and food delivery down only 1.2% from pre-pandemic levels. In the third quarter of 2021, temperate regions, including California, South Central and Southeastern states, have surpassed sales of food compared to similar sales in 2019. But alcohol beverage sales from these same venues and across the same time period trail 19% compared with pre-pandemic levels.

The Northeast is lagging pre-pandemic levels in both sales of food (-14%) and even more dramatically in alcohol beverages (-33%). California, however, has seen food sales increase 6%, while sales of alcohol beverages remain down 6% compared with the third quarter of 2019.

In the Plains, food sales are down 9%, while alcohol beverages are down 25%. In the Midwest, food sales are 6% lower and alcohol beverage sales are 24% lower; in the Mid-South, food sales are down 8% and alcohol beverage sales are off 29%.

Data show that recovery has been slower in certain regions. In the Plains, food sales are down 9%, while alcohol beverages are down 25%. In the Midwest, food sales are down 6%, and alcohol beverage sales are down 24%. In the Mid-South, food sales are down 8%, and alcohol beverage sales are down 29%.

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