Fast food abuzz about alcohol
Restaurants hope for big profits from booze
Apparently, the fast-food industry needs a stiff drink.
An increasing number of chain restaurants, such as Taco Bell and Chipotle Mexican Grill, are serving alcohol to lure in new customers who might otherwise go elsewhere to get beer, wine or cocktails.
In the competitive world of fast food, restaurants need an advantage. In the year ending in September, chains saw no increase in customer traffic, according to the research firm NPD Group. Tacking on alcoholic beverages to an order is a way to drive up sales. Mixed drinks have a markup of as much as 90% and beer, 25%, according to restaurant consultant John Gordon.
Taco Bell plans to open about 150 new locations that will serve beer and frozen mixed drinks. Pizza Hut, which serves beer and wine at approximately 3,500 of its restaurants, is set to add alcohol at another 200. Chipotle is market-testing a frozen version of its margarita, while Shake Shack, which features ShackMeister Ale and red and white wine, offered a limited-time wine shake to mark the return of TV show Will & Grace.
“It creates a little bit of buzz — in both senses of the word,” said Aaron Allen, a global restaurant consultant. “A lot of beverages with alcohol will have $3-$8 ticket prices, depending on their promotional pricing. Add a few of those on and you increase the check average. You can drive revenue without having to drive traffic.”
Jose Juarez enjoyed some ShackMeister Ale with his hot dog lunch on a recent afternoon at Shake Shake in New York City’s Madison Square Park. He said he was surprised to see beer on the menu, but happy to pay $5.79 for the 16ounce plastic cup.
“I was craving a beer and I got it,” said the 34-year-old animator, visiting from San Jose, Calif., but he also wondered if the traditionally kid-friendly environment was the best place to imbibe. “It’s a family place. You don’t want a guy who drinks too much. I don’t know if it’s completely a good idea.”
He’s not alone in his concern. Mothers Against Drunk Driving said it’s monitoring the addition of alcohol to fast-food menus.
“We’re going to watch it very closely,” said MADD national president Colleen Sheehey-Church. “MADD is not against the responsible sale of alcohol to adults. The key words are responsible and alcohol and adults. ... Our concern is the public’s safety once people leave the restaurants.”
The greatest concern is about serving alcohol in places that tend to be popular with younger people
“The more available alcohol is, the more people will drink and the more likely it is you’ll see more problems,” said David Jernigan, associate professor at Johns Hopkins Bloomberg School of Public Health. “It’s not like adding salads to their menus.”
Not everyone says “cheers” to booze. Franchisees have to be willing to navigate laws that determine everything from the time alcohol may be served to servers’ ages to food-sales minimums.
And while some chains are reaching for alcohol some are pulling back. Burger King once had six Whopper Bars in the United States. Now, there are only three beer-serving locations.
And in January, Starbucks paused the roll-out of the Starbucks Evenings wine and craft beer menu at companyowned stores. Today, it’s offered at only a few U.S. airport cafés, which are run by licensees. However, the chain said it will look to integrate beer, wine and spirits into new retail formats like its new high-end Reserve Roasteries.