Building Beverage Business
By Patrick Bax
Talk about liquid assets.
Beverages are being
shaken, stirred, blended,
and swirled into new
and increasingly
profitable menu items
across the country.
16 In predicting the hottest foodservice
trends for 2013, market-research firm
Mintel noted that, “Beverages have
always been a reliable profit center for
restaurants, but relying on these add-on
sales isn’t as easy as pouring a big gulp any
longer. [There are] raised expectations
for the beverage category, and keeping
up with the waves of innovation will
become a vital part of all segments of the
foodservice industry.”
Fortunately, the experience of the past
few years has the foodservice industry
poised to meet the demand.
“Beverage innovation has been
building steam over the past decade,”
says Gordon Food Service® Corporate
Next Course by Gordon Food Service / gfs.com / Winter 2014
Consulting Chef Gerry Ludwig, CEC.
“Just as diners have become more savvy
and sophisticated about food, they’re
demanding more flavor and variety
from their drinks.”
Here’s a look at today’s most popular
beverage categories:
Coffee is hot, even when it’s cold
Mintel Menu Insights reports that
the menu incidence of regular, unflavored coffee is down 25 percent over
the past three years. Instead, restaurants
are offering more lattes, frappés, and
macchiatos. Frappés alone grew by a
whopping 75 percent from the second
quarter of 2012 to 2013.
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B u i l d i n g B e v e r a g e B u s i n e s s
But you don’t need a special machine
to create a specialty coffee. “It can be
as simple as adding a shot of flavored
syrup to hot or iced coffee,” says Erin
Newton, Gordon Food Service Associate
Category Leader, U.S. Beverages.
Mintel reports that the most popular
flavor add-ins during the past three years
have been caramel and vanilla, followed
less closely by cinnamon, chocolate,
raspberry, caramel and mocha, espresso,
and chocolate and mint.
Finish off the flavored coffee with a
nice garnish—say, whipped cream with
a drizzle of syrup, fruit, sprinkles, or
a sprig of mint, and, Newton says,
“You’ve got a signature drink that can
justify two, five, or 10 times the price of
a regular coffee.”
Juices go beyond the ordinary
Sales of orange juice and apple juice
were relatively flat on menus from 2010
to 2013, Mintel reports. But pineapple,
kiwi-strawberry, and other fruit juices,
apple cider and other ciders, as well as
coconut juice all grew—the latter by an
astounding 167 percent.
Tea follows coffee trends
“Plain tea is flat or in decline on
menus,” says Mintel Foodservice
Analyst Kathy Hayden. “Tea offerings
are increasingly being used as a base
for customers to customize their drinks
and add an extra dose of flavor, fun,
and health.”
Using fruit flavors in iced tea is a
particularly popular trend. During the
past few years, trendier peach, mango,
blackberry, strawberry, pomegranate,
chai, and mint options have greatly
outpaced classic flavors like lemon
and raspberry.
Teas also are getting the icy, frothy
treatment in items such as Starbucks’
Tazo Green Tea Frappuccino Blended
Cream and Atlanta Bread Company’s
Frozen Spiced Chai.
The Chicago-based restaurant-research
firm Technomic Inc. reported in 2013
that soft-drink sales have been on the
decline in recent years. Yet diners still
want that fizz. Operators are responding
by concocting housemade sodas. This
past summer, for example, Ruby Tuesday
featured a Strawberry Fizz handcrafted
with real strawberries, freshly squeezed
lime juice, and carbonation.
Use charging canisters to easily carbonate
liquids. “Charge up a combination of
flavored syrup and water, then ‘hit’ drinks
with it before serving,” Ludwig suggests.
“That gives you a delicious carbonated
beverage that differentiates you from
the competition.”
Adult beverages spike up the flavor
“Beverage innovation has
been building steam over
the past decade.”
Smoothies rival shakes in popularity
“Shakes are still very common,
but smoothies are almost as popular
today,” Hayden says. One reason is that
smoothies, which typically contain fresh
fruit and/or vegetables, are perceived as
more healthy.
“Smoothies are where healthy and
indulgent cross paths,” Ludwig says.
“Green smoothies have really taken off
in the last 12 months. They’re typically
made with a banana base and some sort
of green—say, spinach, celery, or kale.”
Craft sodas outpace conventional soft drinks
Flavored lemonades also are coming
on strong. Top flavors include mango,
blackberry, berry, cherry, and peach,
which grew by 133 percent from 2010
to 2013. Hayden predicts that, in the
near future, melon flavors will come
on strong.
Charging is a hot trend on the bar menu
as well, part of an increasing emphasis on
mixers in the preparation of cocktails
and mixed drinks. Technomic reports
that the mixer category—prepared mixes,
juices, carbonated soft drinks, syrups/
flavorings, purées, tonic waters, and
energy drinks—is expected to continue
its steady growth into 2014.
Other adult-beverage trends identified by Technomic include sweet wines,
more extensive beer lists, unique hard
ciders, and flavored whiskeys.
"In every category and segment of
spirits, wine, and beer, flavor is what
attracts consumers and keeps them
coming back,” noted Technomic
Director of Research Eric Schmidt in
early 2013.
Here are some additional considerations for building beverage business:
Flavor Rules. It can’t be emphasized
enough—consumers are seeking new
and more complex flavor experiences.
Use more unusual fruit ingredients,
double and triple the fruits you use, add
sprigs of herbs, introduce carbonation.
Layer the flavors and textures.
Seasonality. “Seasonality creates a
‘get-it-now’ mentality,” Hayden says.
Indeed, Mintel research shows that
53 percent of consumers say seasonal
drinks are a great addition to a menu.
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B u i l d i n g B e v e r a g e B u s i n e s s
From pumpkin and apple cider in the fall,
to eggnog and gingerbread in the winter,
to peach-infused iced teas in the summer,
seasonal flavors create excitement and
boost beverage sales.
Health Halo. Mintel reports that
consumers seem more open to “betterfor-you” options in beverages than in
food. That’s one reason behind the
rise of teas and smoothies—especially
smoothies packed with nutritional
enhancements like protein powder or
Greek yogurt.
“It also makes sense to offer ‘light’
and sugar-free versions of coffee
drinks,” Newton says—according to
Mintel, 59 percent of consumers say it’s
important to consider sugar content
before ordering drinks.
Snacking. The snack market—driven
by consumers ages 18 to 34—is likely
to grow, Technomic predicts. Specialty
beverages have proven they can be a
stand-alone product in the quickservice sector. Newton forecasts the
same for other foodservice segments,
so take advantage of the opportunity to
position beverages as snack items.
“We’re seeing an increase in beverage
happy hours,” Newton says, “and
operators are successfully promoting
nonalcoholic options in the traditionally slow 2 p.m.-to-5 p.m. slot.”
Promotion. Limited-time offers
(LTOs) are a great way to promote new
beverages. Table tents and recommendations from social media and servers
are also effective motivators.
Training. “Servers have to suggest
and sell beverages just as they do food,”
says Ed Dian, Gordon Food Service
Non-Food and Beverage Category
Leader. “Servers should know how each
drink is made and what it tastes like.”
Pairings. Operators can suggest
beverage/food pairings, just as many
do with wine and food. “We’ve seen
an increase in beverage pairings with
desserts, especially,” Dian says. “For
example, you might suggest an acidic
light-roast coffee with a fruit dessert
and a dark roast with chocolate ice
cream.” Offer a special bundled price,
and diners might find the deal hard
to resist.
Upgrading your beverage menu to
reflect current trends requires careful
consideration, planning, and training,
but, Dian adds, “Given the very low base
cost of most beverages, the potential
profit is well worth it.”
While you’re at it, make sure to stay
aware of what your competition is doing.
“It’s great if you can be first to market
with a new beverage category,” Newton
says, “but, if you can’t be first, be
different. If everyone in town is offering
a French-vanilla latte, develop your own
signature flavor. The opportunity is too
good to pass up.”
Thirsty For More?
Ask your Customer Development
Specialist how the following Gordon Food
Service tools can help you upgrade your
beverage menu:
• Kitchen-tested recipes across all
beverage categories.
• Quench, our monthly flyer
spotlighting creative drink recipes.
• LTO Direct®—an easy, affordable way
to create LTO promotions.
18 Next Course by Gordon Food Service / gfs.com / Winter 2014