Dig a little deeper for that next drink
If it’s been a while since you last drank your favorite alcoholic beverage you may be in for a rude awakening when you receive the bill.
Alcohol pricing in restaurants and bars over the past couple of years has increased dramatically, with wide variations by segment, according to an in Nation’s Restaurant News.
Restaurant Sciences LLC, a market research firm that tracks food and beverage consumption across the food service spectrum in North America, tracked millions of transactions at a period roughly between October 2012 and April 2013, breaking down price increases on various product categories by segment.
According to the research, mass-market beers, like Budweiser and Pabst Blue Ribbon, showed the highest price increases within the beer category — except in family dining concepts, where beer prices for that level of product remained steady. Despite the popularity of “ultra-premium” craft beers, price increases for those products were relatively low.
For liquor, the biggest increases were seen in fine dining — where the price of spirits grew more than 11 percent — and also in family dining, where prices increased 4.5 percent on average. The casual dining and bar/nightclub sectors, where most spirits are sold, saw virtually no increase.
Wine prices also inched up during the period, with the biggest increases seen at the family-dining and fine-dining levels — though the data may indicate consumers are migrating to more expensive bottles, said Chuck Ellis, president of Restaurant Sciences.
Mike LeMoine, owner of Spanky’s Bar and Grill in Orange, said alcohol prices have gone up every year. “Beer has gone up every year. It cost grains to make it. You have transportation costs. Farming costs,” LeMoine said. “Any farm products have went up in price. Beef will go up in the next three years.” He added there’s a 27 month turnaround on cattle and it takes 27 months to replace them. The State of Texas, additionally, have gone up on taxes. The liquor tax was 14 percent, it’s now 15 percent. Sales tax is eight-and-a-quarter percent.
Insurance costs have gone up as well. “You have to raise prices to all those factors,” he said. The prices, however, hasn’t affected LeMoine’s bottom line. “Business has been real, real good. Liquor sales are good,” he said. On the flip side though, he said it’s hard to project because it seems everything is going up including the cost of labor. He cited as an example the city of Seattle raising the minimum wage to $15 an hour, causing prices to go up exponentially. “It costs more money. For 26 years I have to raise prices when the minimum wage goes up,” LeMoine said. “I have to pass on the cost to the consumer. It’s (President Barack) Obama’s idea to make everyone equal. There will soon be two classes of people: people with money and those who don’t have it.”
Red’s Liquor in Orange is the supplier for Spanky’s. Nesla Vaughns of Red’s said prices have been rising. She believes it’s due to either inflation or it costs more to make the product.
“Yeah, we had to raise prices. It’s at least a couple of dollars more depending on what it is,” Vaughns said. She said the higher prices hasn’t affected their business. She added people will find a way to purchase alcohol just as they find a way to purchase gasoline and cigarettes. “They’ve got to have it,” she said. Vaughns said she can’t foresee prices going down. Instead, she’s of the opinion they will probably keep increasing. She mentioned some of their customers purchase items while they are on sale or buy in bulk.
Ashley Simmons of The Hitchin’ Post in Bridge City said some liquors such as Crown Royal and Jack Daniels have risen $5 in cost over the past three years. “We have to go up when the suppliers go up,” Simmons said. She further believes the prices shot up when fuel prices began rising. Simmons also doesn’t think the prices will go down, if ever. Many customers wait for a sale to make a purchase.
Angela Stone serves drinks at Spanky’s Bar and Grill in Orange. Data shows alcohol prices have risen the last few years due to a variety of causes.
RECORD PHOTO: David Ball