WELCOME TO ANOTHER EDITION OF SBC’S F00D &
BEVERAGE BULLETIN! These periodic bulletins highlight
important topics and trends in the Food & Beverage industry. Let’s face it:
the F&B world is a difficult one to navigate. Even after launching their
eatery, lounge or shop, an owner must monitor and process a constant
wave of information in order to successfully manage their establishment.
Keeping up with important news regarding economic forecasts, culinary
trends, regulatory changes, and technology advances (not to mention
neighborhood-specific events and information!) is a daunting challenge.
We hope that you find the Bulletin a valuable management resource and
welcome your feedback – please contact us with your comments and
questions. ~Brendan Guastella~
The Burgeoning Craft Beer Market
As craft beer continues to gain prominence with both consumers and culinary types, retailers are increasing
their stocks of popular local and regional brews and restaurants are investing more into craft beer with
diversified offerings and special pairing menus. The increase in sales of craft beer and the continued attention
these beers get from chefs, brewers and restaurants suggest that craft brewing is more than just a fleeting
trend, and knowledge of fermentation and brewing is quickly becoming just as important as wine expertise in
the restaurant world.
To keep up with the growing demand for beer education, the Culinary Institute of America is partnering with
Brooklyn Brewery to develop a small brewery on the college’s Hyde Park, N.Y., campus. The facility, slated to
open in summer 2015, will be located in the school’s new student union and dining facility, which is currently
under construction.
The brewing facility will help the CIA expand its beer curriculum, and students pursuing a concentration in
Advanced Wine, Beverage, and Hospitality will staff the brewery and learn about the science of fermentation
and how to run a food and beverage business. Brooklyn Brewery has worked with the school on beer
promotions for more than 20 years, and the brewery’s Brewmaster Garrett Oliver helped the CIA design the
curriculum, recipes and brewery set-up. Brooklyn Brewery will use the CIA facility as a testing ground for
new beer recipes and flavors.
Craft beer sales grew 16% in volume over the past year, while sales of major brands like Budweiser and
Miller have declined 1.7%. Craft beers are edging out the big-name brands, but it’s not all bad news for these
big brewers, which are rapidly snapping up craft beer brands and launching their own. Many consumers are
unaware of the fact that popular craft label Blue Moon is owned by major brand MillerCoors, and Sam Adams’
parent Boston Beer Co. produces more than 2.5 million barrels of beer per year. Numbers like these beg the
question of whether these large operations can really be called craft breweries at all.
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The Affordable Care Act and The Restaurant Industry
More than three years since it was passed into law, restaurant operators continue to look for more clarity
about what the Affordable Care Act means to their businesses in terms of costs, reporting, what they will have
to offer and more.
Businesses got a small reprieve when the deadline to comply with the plan's employer mandate component
was postponed for one year., and restaurant operators have been using the extra time to obtain critical
pieces of information, such as how many of their employees would actually want health insurance from their
employers; how the state-run exchanges would work and how to direct employees to use them; and the
government's reporting requirements in areas such as employee census and how to document the fact a
business made a qualifying offer, to name a few.
The restaurant industry in particular has many endemic workforce factors that make navigating this new
territory difficult, including the fact that many employees are young and indifferent to health insurance; the
vast majority of them are part-time shift workers; and employee tenure is low. Industry analysts anticipate
greater clarity in the coming year as greater exchange information becomes available.
While the extra time to prepare for the healthcare mandate is helpful, it does not eliminate operators' costrelated anxieties. Because the restaurant industry operates on extremely tight margins, even slight increases
in costs can have a significant impact on the bottom line. And operators are limited as to how much or how
frequently they can adjust menu prices. Careful advance planning is a must -- for additional information on
the impact of the Affordable Care Act on the restaurant industry visit: http://website
healthcare.restaurant.org.
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The Gluten-Free Trend (Fad?)
Surging demand for dining options that are sensitive to dietary allergens has led to a change in offerings and
operations for much of the restaurant industry, especially fast-casual concepts, where the customizable dish
reigns. Gluten, the latest focus of the food allergy community, has had a particularly powerful impact on
menus—and on employee training.
By the end of the year, the gluten-free market is expected to grow into a whopping $7 billion industry, driven
in part by the estimated 1.8 million Americans suffering from celiac disease—an autoimmune reaction to
gluten—or coping with gluten sensitivity.
And it’s not just the gluten-intolerant driving the craze for wheat-free products. Rather, the 65 percent of
consumers who eat or used to eat gluten-free foods do so because they think it’s healthier, and 27 percent do
so because they feel a gluten-free diet assists weight-loss efforts.
Paul Antico, founder and CEO of industry resource group AllergyEats, says the value of better serving
consumers who need to eat gluten free for medical conditions is huge, given the 1 percent of Americans who
require a gluten-free diet and the almost one in three who now eschew gluten. “For a really minimal expense,
quick serves can not only serve the community safely, but make a lot more money doing it.”
While there are clearly benefits to the restaurant industry being responsive to customers’ dietary needs and
preferences, many analysts are concerned about the integrity of gluten-free offerings, emphasizing that
employee education and protection against cross contamination must be essential components to a program.
The U.S. Food and Drug Administration announced last year new regulations defining what restaurants can
dub “gluten-free.” The regulations go into effect August 5, 2014, and stipulate that to bear a gluten-free label,
an item must have less than 20 parts per million of gluten.
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Although the gluten-free trend may wane, many fast casual dining experts believe that over time, the longterm trend is leaning more toward ‘have it your way,’ and the restaurants who are willing to accommodate
and cater to specific needs will increase their market share.
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U.S. Wine Survey Facts
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Americans polished off 297 million cases of table wine in 2013, according to the Wine Market
Council’s annual report on U.S. Wine Consumer Trends, or 1.5 million more cases than the previous
year.
According to surveys, 66 percent categorized themselves as occasional drinkers while 34 percent
said they are “high frequency” drinkers, meaning that they drink wine daily or several times a week.
Budget wines — those priced at less than $10 a bottle — attracted 47 percent of buyers. High-end
wines — priced at more than $20 a bottle — attracted 30 percent of buyers, and box wines attracted
23 percent of buyers.
Women drank more wine occasionally than men but an equal number of men and women were
frequent wine drinkers.
Generations had marked differences in their wine drinking patterns and consumption: WWII (82 and
over) 12 million; Swing (69-81) 30 million; Boomer (50-68) 44 million; Generation X (38-49) 44
million; and Millennial (20-37) 70 million.
California ranks No. 1 in wine purchases, followed by Washington and Oregon.
Red wines are growing faster than whites with blush trailing.
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