October 13th, 2010
Wine & Hospitality Ezine 
Restaurants & Wineries Getting Creative in the Poor Economy
Visits to upscale restaurants in America declined by 15% between May 2008 and May this year, according to the NPD Group, a research firm. Fast-food restaurants, on the other hand, saw traffic decline only 2%. Similarly, although wine consumption is up, sales of premium and super premium wines have dropped significantly.
National Restaurant Association's Restaurant Performance Index Values Greater than 100 = Expansion; Values Less than 100 = Contraction  Source: National Restaurant Association
Many in the industry are getting creative in order to survive. Some of the trends:
- Many wineries are significantly cutting production. With lower production there is often less debt and less pressure to move the Some wineries are cutting (or completely stopping) selling through distributors, and are focusing entirely on consumer direct sales, both through their tasting rooms and through their wine clubs.
- The number of restaurants are offering discounts, sometimes even deep discounts, through sites like Groupon is up. Restaurants account for 40% of Groupon's offers.
- Free corkage offers in restaurants are increasing.
 More restaurants are offering discounts during their off-peak hours.- Some restaurants have gone so far as to stop taking credit cards, simply to avoid the processing fees.
- I have heard of one restaurant who offers a 10% discount to anyone who brings their own take out containers. Creative, money saving and green!
- Some businesses offer a discount to locals to encourage more frequent visits.
- Increasing the hours of operation has been the approach some businesses have taken, perhaps adding a meal period that wasn't served before.
- Some wineries have added a "second tier" brand to have a lower priced wine to offer, without diluting their original brand reputation.
- Severino's Grill in Aptos, CA offers "Tasty Tuesdays" with 50% off their entire menu.
It doesn't appear that things are going to turn round quickly, so what are you doing to get creative? Email me and let me know!
-Margie
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Posted in Restaurant Management, Sales, Wine / Wine Tasting
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