Snapshot | Revenues | Competition | Organization & Structure | Background & Development | Operations | Workforce

 

 

  

Companies in this industry sell alcoholic beverages for on-premises consumption and may also offer limited food service. Companies are typically local or regional, as varying state liquor laws complicate the ability to form large chains.

Laws and regulations surrounding liquor vary from country to country. For example, the legal drinking age for beer and wine in Germany is 16. While drinking laws are less strict in some countries compared to those in the US, laws are stricter in other places. Many Islamic countries, for example, forbid the consumption of alcohol by Muslims. But some such countries allow hotels to sell alcohol in order to accommodate non-Muslim tourists.

The US bar and nightclub industry's drinking establishments primarily engaged in the retail sale of alcoholic drinks number around 70,000, according to IBISWorld, which generated approximately $26 billion in combined annual sales revenue, with the average establishment accounting for about $200,000. The industry has high product turnaround but low profit margins that make it susceptible to any adverse changes in demand (including any recessionary declines). States representing the majority of drinking places were: Wisconsin with 4,489; California with 4,449; Texas with 4,388; New York with 4,283; Illinois with 3,634; Pennsylvania with 3,572; Florida with 3,191; and Ohio with 3,201. Other significant states included Michigan, New Jersey, Louisiana, Indiana, Iowa, Minnesota, and Washington. Worldwide, there are 61 nightlife markets. The top countries are Japan, China, India, Russia, Canada, Mexico, Brazil, Argentina, UK, France, Germany, Italy and U.S.

No major companies dominate; varying state liquor laws complicate the ability to form large chains. The industry is highly fragmented: the 50 largest companies hold just over 5 percent of sales. Taverns were the largest sector within industry, with 19,660 drinking places. Combined, they shared more than 32 percent of the market. Bars and lounges represented 19.8 percent edging out drinking places share of about 19.5 percent of the market. Cocktail lounges held 11.5 percent and night clubs had 8.6 percent. Per the U.S. Census Bureau's Statistics of U.S. Businesses, there were about 393,912 people employed within the industry with nearly $4.55 billion in annual payroll in 2015.

 

Last years total Restaurant and Bar (Drinking Establishments) Industry Sales accounted for $710 billion with 970,000 locations. According to the Restaurant Industry Association and Dun & Bradstreet, Nightclubs generated approximately $26 billion in combined annual sales revenue. The 2015 Top 100 Nightclub list was developed by Nightclub & Bar in partnership with Technomic Inc. using secondary research and yielded primary data from 1,444 nightclub, bar and lounge locations.

  

According to Technomic’s BarTAB (Trends in Adult Beverage) report, the 2013 Top 100 Nightclub & Bar venues generated $1.5 billion in total revenue. More than two-thirds (68.2%) of operators surveyed experienced revenue growth in 2012, and nearly two-thirds of them (31.4%) reported revenue growth in excess of 10%. Once again, the top nightclub and bar venues outperformed the industry overall. The bar and nightclub segment grew 3.9% in 2012. Projected sales of alcoholic beverages at bars and restaurants are expected to rise 2.7% in 2015, with wine projected to be the top growth driver, followed by spirits and beer, according to Technomic's recent BarTAB Report. The beer category will see 2.3% growth, as domestic beers lose share to craft brews, cider and imports, said Technomic Director of Research Eric Schmidt. The industry is projected to continue experiencing competition from non-industry establishments such as restaurants as well as from people opting to drink at home.

 

Vegas is a major hub of nightclubs based on revenue for "Large Box Clubs." Of the Top 100, the top 3 nightclubs are in Las Vegas, NV and make $60-70mm each;  the No. 1-ranked Marquee Nightclub & Dayclub in Las Vegas generated record-breaking annual revenues in excess of $80 million; the 4th made $45-60mm in 2011 and is in Miami. The next four nightclubs made revenues of $35-45mm each and three are in Las Vegas. The following six nightclubs made revenues of $15-10mm each and three are in Las Vegas. The next 35 venues #23 thru #57 had revenues of $10-5mm each; and the remaining venues reported revenues less than $5mm each which includes "small box clubs."

 

One quarter of the list — 25 venues — are located in California, with 15 in the Los Angeles area, seven in San Diego, two in San Francisco and one in Sacramento. Las Vegas contributes 22 venues, with eight of the top 10 venues located in Las Vegas. Ten are in the five boroughs of New York City. Chicago contributes five venues, Texas delivers four and Atlantic City and Washington, D.C., each offer up three. It’s expected that the major markets dominate the Top 100 list, but operators in a number of other markets — including Atlanta; Denver; Ocean City, Md.; Destin, Fla.; Lake Cuomo, N.J.; Kansas City, Mo.; Scottsdale, Ariz.; Myrtle Beach, S.C.; and Knoxville, Tenn. — also succeeded in bringing in the crowds and revenue.

Of the Top 100 survey participants, 42.8% identified their venues as nightclubs; 70.6% of them described their hotspots as dance clubs. Of those identifying their venue as bars, 31.7% are sports bars and 29.3% are traditional bar/taverns. DJs and live entertainment are featured by 88.3% and 73.6% of total respondents, respectively. Nearly 80% offer a dance floor, 70.1% provide VIP areas and 65% offer bottle service.

The majority reported solid growth in 2011. In fact, 70% of respondents to the Top 100 survey indicated their venues’ revenues increased, and of them, nearly half (48%) reported revenue increases exceeding 10%. Consistent revenue was cited by 20% of survey respondents, while 3.4% cited revenue declines. Drinks generate the lion’s share of venue revenues – 56% of sales from alcohol is the mean among Top 100 survey participants. While in the venues, partyers favored spirits, which generate 44% of alcohol sales. Beer contributes 25% and wine 9%. A full food menu is offered by 68% of survey respondents’ venues. Gaming, such as pool tables, video game systems and jukeboxes, are available at 42% of respondents’ venues. Nearly three quarters (73%) have outdoor patio, terrace or rooftop space, which is an increase from 63% a year ago.

 

Venues dont report cover charge revenue information specifically, but average fees range at $5 to a local bar event, $10 Guest list cover, $20 average entry fees and higher for concert or performance style events. This would exclude Las Vegas where entry fees can range from $20 - $200. Current ticket prices for nightclub events are sourced from http://vip.wantickets.com

 

Mike Ginley, Partner at Next Level Marketing, provided the latest on-premise consumer research study fielded exclusively for the 2014 VIBE Conference. The study was conducted using Next Level’s custom on-line survey tool. The study includes 1,000 on-premise national chain beverage alcohol consumers. The 2014 study includes 21+ consumers from all of the top casual dining, fine dining and hotel chains. Here are a few statistics relating to the consumer that will help owners and operators to better understand their patrons:

-55% of respondents are going out as often as last year
-70% visit the same types of restaurants and bars
-15% are going to less expensive places
-15% are going to more expensive places – Millennials are the group skewing to better places
-65% order drinks most to all the time with males ordering more frequently than females. Surprisingly, Millennials order less frequently than older consumers.
-79% try a new drink every 90 days with new drink trial highest among Millennials.
-73% have ordered a beer at a restaurant or bar in the past 30 days and 62% order the highest quality beer at the best price
-70% of consumers have ordered seasonal beers and there is growing interest
-65% have ordered wine at a restaurant or bar in the past 30 days with 64% ordering the highest quality wine at the best price
-59% have ordered a spirit cocktail at a restaurant or bar in the past 30 days

The average consumer order 2.3 drinks per occasion with males ordering more than females and Millennials ordering more than the older consumers. Asking for the order is the number one way to sell an extra drink per occasion followed by after dinner drinks, better quality drinks, faster service, smaller sizes and lighter drinks.

When consumers order that second drink, they have been hooked, they need to be reeled in and turned into a repeat customer. The most popular loyalty programs are TGI Fridays, Applebee’s, Chili’s, Olive Garden and Red Lobster.

In order to keep up with the top loyalty programs, restaurants need to stay on top of these consumer trends, such as electronic menus. Today, 25% of consumers have ordered from an electronic menu and this will grow rapidly as they are placed in more locations. Over half of the consumers studied are somewhat interested in ordering from an electronic menu – this is something that is not going away.

Information related to menu content concluded that 80% of consumers expect to see all drink prices listed on the menus that they order from. The majority of consumers feel more comfortable ordering drinks when the prices are published and over half are less likely to order a drink when the prices are not visible. 

 

A study conducted by Optimize Atlanta with participating Atlanta nightclubs and lounges, reveals interesting information about nightclubs, VIP, bottle service, and group dynamics. We learned that the average overall bottle price is $239; the overall average drink price is $10.50; 67 percent consume two or more drinks, shots or cocktails; and spend $55 on average. We also learned that most nightclubs and lounges also offer juices, mixers, bottled water, and energy drinks with VIP table reservations and bottle service.  Some even offer complimentary champagne.  This is in addition to the private tables and exclusivity.

 

Two reports from research firm GuestMetrics indicate a gentle if slow upswing in on-premise trends.

Traffic was just slightly positive during the 4-week period ending 10/5, enough to raise year to date figures to almost flat for the year. While traffic still was struggling to meet last year’s level, overall on-premise food and beverage sales were up 3% in the latest four weeks, an improvement on year to date trends .

Casual dining traffic was up 0.5% over the latest four weeks counted versus down just under a point for the year; bars and clubs remained weak with traffic down just less than 2% for the latest 4 weeks and just over 2% for the year (down 2.2%). The fine dining segment slowed, with traffic down about 1.5% the latest four weeks.

In terms of beverages, beer volume was down about 3.5% in the latest four weeks measured, equivalent to the year to date trend. Beer sales were up 0.7% in the latest 4 weeks, but flat for the year after a strong July and August were followed by a weak September. Premium light share continued down (1.8%) in the latest 4 weeks vs -1.9% for the year; craft gains slowed to 1.6%, below its 2% year to date gain. Fastest growing segments were IPA which had a share gain of 1.4% and cider which had a share gain of 0.6%.

Guestmetrics also reported a gain in spirits on-premise. After declining nearly 1% during the first six months of 2014, volumes were up 0.5% during the third quarter. However, trends softened throughout the quarter, going from up 1.7% during the four weeks ending 8/10 to up 0.6% during the most recent four weeks ending 10/5.

Year to date spirits sales are up 1.7% in the on-premise, up 2.6% for the third quarter, with dollars up a stronger 3% for the four weeks ending 10/5. Dollar sales were driven by a combination of higher price and trade up to higher priced spirits, the firm said. Brown spirits generally out-performed white spirits in the latest four weeks - bourbons and blends volumes up 12% and brandy/Cognac up 5%. Vodka volume was down 3%, rum down 6%. Craft spirits continue to gain share, up about 2% in the third quarter.

 

Today’s consumers seek variety on drink menus. More than half of consumers surveyed say variety of spirits/cocktails (58%) and wine (54%) is important on restaurant menus, while nearly half say the same for beer selection (46%). Additional insights found in the Technomic 2014 BarTAB Report indicate that drink selection can drive traffic and enhance the overall experience of dining out, both of which are important to improving sales and profits.

Operators are responding to varied degrees: the number of adult beverage offerings on all on-premise menus tracked in the MenuMonitor tool rose 5.0% in the third quarter of 2014 as compared with the same period in 2013. During that time, however, national and regional chain restaurants actually reduced the number of beverage offerings (-0.3%). In recent conversations with chain operators, we’re hearing more about the need to trim adult beverage offerings to make drink programs more manageable. 

 

Expense categories include materials used, payroll, human resources benefits, health insurance, retirement/pension plans, advertising, taxes, depreciation, electricity, fuels, equipment, repair/maintenance, and software. Capital expenditures include building, machinery, vehicles, and computer equipment.

The use of fermented beverages in celebratory rituals and social gatherings has been documented in many parts of the world throughout its history. The public roadhouse was developed by the Romans in the first century A.D. as they built their infrastructure of paved roads. The word pub, in fact, is shortened from "public house," a stopping place for the traveler to rest both himself and his horse. In the fifth century, Europeans fostered winemaking. In addition, in the tenth century an Arab physician is believed to have discovered the distillation process (for medicinal purposes).

The tavern, or pub, was an important aspect of English culture and was adopted by colonial America. Rum was prevalent at social occasions in early America, as were corn whiskey and hard cider. Tavern patrons were often entertained by performers, including ventriloquists, dancers, and musicians. The pub was also a place where the day's news was spread, as locals listened to travelers passing through from other places. This dissemination of news made the tavern a natural place for the establishment of local post offices.

The tavern owner was considered responsible for contributing to the town's orderliness. Licenses for serving alcoholic beverages dated back to 1672, and they were subject to suspension or revocation for sales to minors, slaves, servants, or intoxicated adults. Throughout the 1600s and 1700s, wine and malt liquors, as well as hard liquor or spirits, were sold. Rum was imported from the West Indies and had begun to eclipse the popularity of hard cider by the early 1700s. The colonies traded fish, tobacco, cotton, and lumber for rum and for molasses, which was then distilled in New England as rum.

England's Molasses Act of 1733 levied a duty on products imported into the colonies. This legislation provided an impetus for independence from England. Numerous historical figures in pre- and post-Revolutionary America that were tavern owners or sons of owners included Samuel Adams, Ethan Allen, William Penn, and Abraham Lincoln.

Prohibition caused the tavern to be replaced by "speakeasies"--illegal establishments where liquor was plentiful to those who provided the correct password. Organized crime gained its foothold in America during this period, as bootlegging flourished and dealers in whiskey and other liquors protected their market with weapons. Following the repeal of the Prohibition Act thirteen years after its passage, the neighborhood tavern reemerged.

Americans' growing emphasis on healthy eating and healthy living is the primary reason for the slow growth in this category. Self-help programs designed to help people identify and end addiction to alcohol flourished throughout the 1970s and 1980s. Moreover, those who drink alcohol in moderation have become more conscious of caloric measure and the nutritive value of food and drink consumed. In addition, Americans became more disapproving of driving while intoxicated, and groups such as Mothers Against Drunk Drivers (MADD) have gained political and social clout. Rising litigation over the responsibility of drinking establishments for the alcohol consumption of patrons also acted as a force toward lower purchases of alcoholic drinks. The overall effect of this shift in thinking is that the line is blurring between full-service restaurants which serve alcohol and bars and taverns that offer full lunch and dinner menus.

The bar and tavern industry has been heavily impacted by the steadily declining consumption of distilled liquor in recent decades. One bar owner in San Francisco described the environment in the late 1980s as "neo-prohibitionist." In an article in New York Times in 1989, Gerry E. Murphy, then executive director of the then-National Licensed Beverage Association (NLBA), said, "The day of the old bar which just served alcoholic beverages is past." Indeed, the U.S. Industrial Outlook predicted that "Domestic consumption of, and spending for, alcoholic beverages will probably continue to decline, leveling off toward the end of the 1990s."

 

While the overall cause in this threat to the industry is the nationwide trend toward healthier living, the signposts of this shift are many. There has been, for the past several decades, a growing acceptance for the nondrinker in social settings. This has occurred in large part because of the widespread recognition of the physical and emotional health problems created by alcohol addiction. The Alcoholics Anonymous (AA) program, begun in the early 1900s by Bill Wilson and others, was created to combat the problem of alcoholism through meetings of individuals who identify themselves as having an addiction to alcohol. The number of people who have ended their consumption altogether through this mutual support program is unknown, but is believed to be in the millions. Although people who wished to abstain from alcohol consumption felt social pressure to drink at parties and public gatherings, the stigma associated with "teetotaling" faded until it was almost nonexistent in the 1990s. MADD gained political influence and helped create a stigma surrounding driving an automobile while intoxicated. In addition, several key civil actions brought by victims of auto collisions and their families resulted in increased liability of alcohol servers for intoxicated patrons that leave establishments and cause accidents.

  

The rise of sports bars in the 1980s provided an example of industry adaptation to consumer health concerns. In contrast to the dark, smoke-filled bar of past decades, sports bars are lighter, with an updated, high-energy ambiance. The vast majority of such bars, in addition to having televisions for their customers to view, serve full menus of lunch and dinner items. These types of establishment stress a casual atmosphere and efficient but unobtrusive service so that patrons may meet to watch an athletic event and enjoy gathering with friends. Sports bars also target women and families, often tailoring their menu to include light, healthy food in addition to burgers and other American fare. The celebrity element is another prominent characteristic of sports bars. Many are owned by, or named after, athletes, and rely on visits by athletes to publicize and promote the establishment.

 

In the early to mid-1990s, the eating and drinking places industry as a whole was growing at a steady rate, averaging about five percent increase in overall sales per year. By contrast, sales from bars and taverns (including both alcohol and food receipts) were flat and in some years actually fell. According to the National Restaurant Association (NRA), for example, sales at such establishments fell from $9.4 billion in 1991 to $9.3 billion in 1993, rebounded to $10.9 billion by 1995 but then fell again to $9.4 billion in 1996 (the latter a drop of nearly 14 percent). The NRA expected 2000 sales of about $12 billion, an increase due in large part to the rising popularity of sports bars.

Several different pieces of federal legislation either hampered the industry or threatened it in the 1990s. President Clinton signed a bill that reduced the business meals and entertainment tax deduction from 80 percent to 50 percent in 1993. The industry immediately began lobbying for repeal of that legislation through separate bills introduced in both the Senate and House of representatives.

  

Americans were increasingly doubting the healthiness of alcohol consumption in the early and mid-1990s. Medical research linked high alcohol consumption to liver cancer and other degenerative diseases. Smokers who also drink alcohol were found to have 13 times the risk of developing lung cancer as those who neither smoke nor drink. Although some research had found that widespread consumption of wine with dinner in France was responsible for their lower levels of heart disease compared with that of Americans, a 1993 study contradicted that finding. The more recent study concluded that the relative health of the French was due not to their wine consumption, but to their love of vegetables.

Another successful concept of the 1990s has been the brew pub. Although this is a borderline category since many brew pubs derive more than half of their sales from the food they serve, the brew pub--and microbrewer beer generally--has helped to revive both a beer industry on the decline and the drinking places industry itself. According to Michelle Dorfman, writing in ID: The Voice of Foodservice Distribution, "brew pubs, by definition, have an on-site brewery and more than 50 percent of the brew product is consumed on-premise." After gaining initial popularity early in the 1990s, the category has since exploded with more than 500 brew pubs nationwide by late 1996.

Posher alternatives that catered to popular fads such as swing dancing, martini bars became more prevalent and helped rejuvenate the industry. Industry entrepreneurs also embraced the cigar fad of the 1990s, and began to allow their patrons to smoke cigars on-site or created specialty cigar bars that sold a variety of cigars in addition to selling alcoholic beverages. Such innovations were signs that the industry would keep reinventing itself despite all the negative trends.

 

A bill under consideration in 1999 included a provision to lower the national blood-alcohol content (BAC) level defining intoxication from .10 to .08. The then-NLBA opposed this measure on the basis that, of those intoxicated drivers who were killed in auto accidents, 81 percent had a BAC higher than the legal limit of .10. However, several states, including California, had already lowered the BAC to .08 while national legislation was still being considered. By the mid-2000s all states had adopted the lower limit. While opposing legislation that was perceived to be harmful to the industry, bar and tavern owners fought back by courting consumers.
  

This grim outlook for the alcohol industry as a whole did not portend well for the bar and tavern industry. Many hotel lounges were transformed into combination eating/drinking establishments, or eliminated altogether to be replaced by meeting rooms. Although alcohol items have higher profit margins than food items, food was increasingly being emphasized more than drinks. Renewed interest in wine, martini bars, and sports bars helped stave off a continued decline at the end of the century, stopping the sales slippage with 2000 totals of $11.9 billion.

 

The response of the bar and tavern industry to the liability issue was the education of its workforce about this challenge. A program sponsored by the American Beverage Licensees (ABL)--formed by the merger of the NLBA and National Association of Beverage Retailers (NABR) in 2002--called Techniques of Alcohol Management (TAM) certifies bartenders and other alcohol servers in methods of curtailing the problem. The program teaches employees of taverns to identify signs of intoxication in patrons, the effect of food consumption on the rate of intoxication, how to discreetly regulate a customer's consumption, and the application of state and local laws to the sale of alcoholic beverages. A similar program is called Training for Intervention ProcedureS (TIPS)

Major sources of revenue include beer (35% of sales), distilled spirits or hard liquor (30%), food and non-alcoholic beverages (20%), and wine (7%). Companies may specialize in certain beverages, like craft beers or martinis. Among the key findings:

• Beer is the largest adult beverage category on-premise, generating more than four-fifths of volume and nearly half of dollars. Major domestic brands, while challenged, maintain the lion’s share of volume and sales, but imported and craft beer are growing.
• Drinking establishments, which include bars, taverns/pubs, lounges, nightclubs, comedy clubs and music/cabaret venues, account for the largest portion of on-premise adult beverage sales, followed by casual-dining restaurants.
• Sparked by cost-conscious consumers and winemaker innovation, on-premise domestic wine growth outpaced that of imports to account for three-quarters of total wine volume in restaurants and bars.
• Spirits generate one-third of total on-premise dollars, and the vibrant cocktail scene continues to evolve, evidenced by the notable growth of both the largest category, vodka, and the smallest category, Irish whiskey.
• Consumers value drink programs at restaurants; one-third report that the adult beverage offering influences their decision to visit a particular concept.
• More than three-quarters of consumers order food with their adult beverage.

Entertainment includes live music, DJs, dancing, and adult entertainment. While most customers go to bars and nightclubs to socialize, bar activities tend to focus more on drinking, while nightclubs focus on entertainment and dancing. Types of bars include microbreweries, taverns, pubs, wine bars, and martini bars. Bars and nightclubs may have themes, like sports or country-western. The failure rate for nightclubs can be high due to the trend-driven nature of the industry; an estimated eight of 10 nightclubs will fail during the first year of operation, according to Nightclub and Bar magazine.

To open a bar or nightclub, a location must have proper zoning from local government. Community resistance to new bars and nightclubs is common due to anticipated problems with drunken patrons and noise. Companies may need both a standard liquor license to sell alcohol, and a pouring license to serve alcohol for consumption on-premise. Multiple types of liquor licenses dictate what types of alcohol a bar can sell, and the availability and cost of licenses can vary greatly. Licenses to serve beer and wine tend to be less expensive than to serve hard liquor. Some communities issue a limited number of liquor licenses, and companies may have to buy one from an existing licensee. Local municipalities may also require an entertainment license to provide TV programming, live music, or dancing.

Local laws typically dictate days and hours of operation. A venue may announce a "last call" or last chance, to buy an alcoholic beverage, prior to the required closing time. The majority of business is during the weekend. Most nightclubs are not open during the day, and many open only two to three nights per week.

Almost all companies consist of a single operation, although the industry includes some regional chains and franchises. Tourist destinations can be good locations, since vacationers tend to visit bars and nightclubs. Size varies greatly, from small corner taverns to warehouse-sized dance clubs. The majority of nightclubs range from 3,500 to 7,000 square feet, according to nightclubbiz.com. Experienced owners tend to run the largest nightclubs, which range from 10,000 to 30,000 square feet. A 3,000 square foot club can gross between $24,000 and $64,000 per month. A 15,000 square foot club can gross between $100,000 and $260,000 per month.

Bars that serve food may have an area for table seating. Nightclubs may have one or more bars, table seating, a stage, or a dance floor. Outdoor seating is popular in warm weather and many tourist locations. Most companies use lighting and decor to create a distinctive ambiance or image to attract specific clientèle. For example, a sports bar may have numerous large screen TVs and sports memorabilia to draw sports fans, while a nightclub may have expensive lighting and sound systems to draw the dance crowd. In addition, a friendly bartender or a popular DJ can help develop a loyal customer base. Some nightclubs promote an image of exclusivity, and may be selective as to which patrons can enter.

Bartenders are responsible for mixing and serving drinks. How fast a bartender operates and how much a bartender pours can significantly affect sales and profitability. Companies may use special pour spouts to standardize liquor dispensation. In addition, secret audits monitor liquor consumption and can be used to identify "heavy-handed" bartenders. Some companies audit liquor inventory daily.

Companies typically buy alcoholic beverages from state-licensed liquor distributors. Federal and state laws prohibit direct sales from manufacturers. Large bars and nightclubs can hold sizeable, expensive inventories of alcohol, especially if the company stocks high-end liquor. Inventory management and cost control can be difficult due to employee error, overpouring, and theft. Proper storage is important to minimize bottle breakage and prevent theft. Bars and nightclubs that serve food typically buy ingredients from food distributors

Companies may use computerized point-of-sale (POS) systems to record orders, look up drink recipes, and manage bar tabs. Beverage monitoring systems use miniature sensors attached to liquor bottles to record individual drink servings and transmit data wirelessly to inventory management systems. Handheld scanners help track inventory. For nightclubs, technology plays an important role in providing entertainment and ambiance. Computer systems that integrate sound, light, special effects, and music videos help create a distinctive environment. In addition, some companies use digital surveillance systems to catch illegal activity by both customers and employees.

For the category of beer, wine, and liquor stores, the U.S. Department of Labor's Bureau of Labor Statistics reported a total employment of 137,390 in May 2009. The largest portion (79 percent) of the workforce is dedicated to sales and related occupations. Roughly 13 percent of workers are employed in positions related to office and administrative support. About 3 percent are involved in moving and transportation.

While the distilled spirits industry has been lucrative, Federal and state excise taxes play a significant role in the industry. In 2005, The National Center for Policy Analysis (NCPA) reported that thirteen states sought increases in taxes and related fees on alcoholic beverages. Further, taxes on distilled spirits were about $0.21 per ounce of alcohol. According to the Distilled Spirits Council (DSC) of the United States, "distilled spirits are one of the most heavily taxed consumer products in the United States. More than half of the price that consumers spend on a typical bottle of distilled spirits goes toward a tax of some kind." The resulting effect on the entire hospitality industry is wide-reaching, as the DSC goes on to say "When beverage alcohol taxes are increased, it creates a devastating ripple effect on jobs throughout the entire hospitality industry."

  

Distilled Spirits Council reported that supplier sales were up 4 percent in 2014 to $23.1 billion, and total U.S. volume growth increased 2.2% to 210 million cases.  It is estimated that overall retail sales of distilled spirits in the U.S. market is nearly $70 billion, supporting hundreds of thousands of jobs in the hospitality industry and producing over $20 billion in tax revenues for all levels of government.

Despite the excise tax, the U.S. Department of Commerce reported that adjusted alcohol sales were up 5.2 percent to nearly $9.2 billion in June of 2008 over the same period a year earlier. Also, according to the NCPA, the total amount of Federal excise tax collected from the distilled spirits category for 2006 was $4.4 billion, from the beer category for $3.6 billion, from the wine category for $800 million. Additionally, state taxes during that same time reached nearly $5 billion.

Of the total 58,829 establishments in 2009, 20.2 percent were classified broadly as drinking places, which accounted for 11,502 establishments and $4.1 billion in 2009 revenues. Of the 71.7 percent of places classified as bars and lounges, 6.2 percent fell under the general classification with 3,523 firms and $858.9 million 2009 revenues; 31.2 percent were classified as taverns with 17,732 establishments$3.7 billion in 2009 revenues; 20.4 percent were classified as bars with 11,569 establishments and $3.11 billion in 2009 revenues; 11.6 were classified as cocktail lounges with 6,599 establishments and $1.61 billion in revenues. Smaller portions of this segment were made up of saloons, beer gardens, and wine bars. Finally, night clubs, cabarets, and discotheques combined for an 8 percent market share, or 4,541 establishments, and combined 2009 revenues of $1.89 billion.

Sources:

  * IbisWorld.com.au Bars, Nightclubs & Drinking Establishments in the US - Industry Code: 72241

US Bars & Nightclubs Industry Risk Rating Report

Bars & Nightclubs Market Research Report

Nightclubs Market Research Report

  * Research & Markets Reports: SIC Codes: 5813 NAICS Codes: 722410 
  U.S. Drinking Places & Bars Industry Report #1369593
  Worldwide Drinking Places & Bars Industry Report #1195668

  * Barnes Reports

Trendology: U.S. Drinking Places & Bars

 

  * First Research

http://www.firstresearch.com/industry-research/Bars-and-Nightclubs.html

 

  * Technomic

BarTAB (Trends in Adult Beverage) Report

  * Anything Research

http://www.anythingresearch.com/industry/Bars-and-Night-Clubs.htm

 

  * Encyclopedia of American Industries. "Drinking Places (Alcoholic Beverages)." Gale, 2009.

  * Reproduced in Business and Company Resource Center. Farmington Hills, Mich.:Gale Group. 2009.
http://galenet.galegroup.com/servlet/BCRC Document Number: I2501400750

 

  * Distilled Spirits Council of the United States. "Distilled Spirits Industry Primer: Taxes." September 2008.
http://www.discus.org/about/industry.asp.

  * National Center for Policy Analysis. "Taxing the Poor." June 2007.
http://www.ncpa.org/pub/st/st300/st300.pdf.

  * United States Department of Commerce. "Monthly Wholesale Trade: Sales and Inventories." June 2008.
http://www.census.gov/whl.

  * U.S. Census Bureau. U.S. Department of Commerce. Statistics of U.S. Businesses: 2005. 24 July 2008.
http://www.census.gov/csd/susb/usalli05.xls.

  *  International City/County Management Association. PM Magazine. "Got Nightlife? Manage Sociability as an Economic Engine" Cover Story, November 2010, Volume 92, Number 10.
http://webapps.icma.org