Some Dry January objectors have speculated that the annual health campaign is hurting bars and alcohol retailers, yet professionals in the field say there are a host of reasons why some small business owners are struggling.
The 31 day abstinence movement may not have helped the alcohol industry, especially when a Morning Consult market research report says Dry January has grown in popularity from 13% of American adults practicing it in 2021 to 19% for 2022.
The COVID 19 pandemic and seasonal trends are larger factors that are likely to cause a decline in alcohol sales.
''DRY JANUARY' Pat Light, founder and president of Light Restaurant Group, which includes Green Rock Bar and McSwiggan's Pub in Hoboken, New Jersey, told FOX Business that January hasn't been the best month for bars prior to Pandemic.
During the first two weeks of January, there was a slight decrease in alcohol sales within the group, according to Light told FOX Business in an email. Dry January has contributed to the decrease, but it's not the only factor that affects alcohol sales. New Year's health resolutions, people slowing spending after holidays, and current concerns related to the Pandemic, are some of the reasons why January tends to be a slower month for the industry. He said that the biggest issue facing bars and restaurants right now is COVID 19 restrictions in New York City. There has been a large increase in people coming across the Hudson River to Hoboken because New Jersey doesn't require proof of vaccination for indoor dining. The impact of COVID 19 on the industry is similar to when a stock market bubble bursts: It will weed out poorly run bars and restaurants and the well-run places. Light and his team have updated each restaurant's menus, built outdoor dining structures, leveraged social media to attract patrons and raised prices to offset rising food and alcohol costs.
As in any industry, bars and restaurants need to adapt or they will falter, Light noted.
Ken Lineberger, founder and CEO of Waters Edge Wineries, said he isn't certain that Dry January has played a role in the company's on-premise sales.
Lineberger said January is typically a quieter month after a hectic December, which was our best month of 2021, despite the fact that January was our best month. We are challenged with staffing issues which cause our areas to limit the number of guests they can serve and leave tables empty if we can't provide the high-quality service in each winery. On top of that, we have had a wave of omicron that has impacted our staffing and guests who have contracted the illness. He said that our January sales are expected to be comparable to 2021 sales, if not slightly better due to the improving economy in most areas of the country. It is not clear whether Dry January will have a negative impact on our sales, given these other factors that may be influencing it in a more pronounced way. Bob Ray, chief operating officer at Margaritas Management Group, said Dry January doesn't seem to be a problem for the business, a margarita-focused Mexican restaurant brand with 25 locations in the Northeast.
Our ratio of bar sales to food sales has stayed the same this month, and we have seen a rise in how often our guests are choosing to have a margarita, Ray said. We have seen other bars and restaurants close earlier in some markets because of staffing adjustments but maybe also seasonality. We have held firm on hours and continue to be up in sales after 9 p.m. compared to pre-pandemic levels. Alcohol sales, and specifically margarita sales, are the core of this later business for us. With locations in Connecticut, Maine, Massachusetts, New Hampshire, New Jersey and Pennsylvania, Margaritas hasn't been immune to external factors like winter storms, but the company has shifted 20% of its dining business to take out, according to Ray.
Compared to mom and pop bars that sell alcohol over food, takeout and delivery services can be a potential challenge, depending on local ordinances on liquor sales and the rise of direct-to- consumer alcohol sellers and third-party delivery services.
A restaurant 365 media representative told FOX that liquor sales at restaurants across the country are down an average of 143% from December to January, according to the data that the all-in-one restaurant management software platform has on file.
Consumer hesitantness for dine-in service in the U.S. has been cited by the recent COVID 19 omicron surge as a major factor in declining sales, according to the U.S. food and beverage service leaders. A number of vaccine mandates for indoor dining may be a factor for unvaccinated patrons who prefer to eat and drink at home.
More than 19.2 million Americans have been infected within a 28 day period, according to the Johns Hopkins COVID 19 dashboard stally on Jan. 27, 2022. More than 50,910 of those cases resulted in death.