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Beverage

Fast casual gets its drink on

Alcohol may be the next differentiator in the segment.

Upgraded food at affordable prices has propelled fast casual into the fastest growing segment for five consecutive years, according to the Port Washington, N.Y.-based NPD Group. Now operators are focusing on the liquid side of the menu, introducing wine, beer and cocktails to snag some lucrative bar action.

“Many fast casuals are looking at [alcohol] as a means of creating an additional menu feature and a point of differentiation, as well as to increase check averages and drive dinner daypart traffic,” says Donna Hood Crecca, senior director of Chicago research firm Technomic. But it has its risks: “The time it takes to shake a margarita, tap a beer or pour a glass of wine can slow what should be a relatively quick throughput,” she says.

Although alcohol generates just a small percentage of fast-casual sales—2 to 3 percent is the norm, Hood Crecca says—it has proven a boon for brands such as Chipotle, which introduced a hand-shaken premium margarita last year. In April, Taco Bell announced the launch of U.S. Taco Co. & Urban Taproom, which opens in Huntington Beach, Calif., this summer. Plans to offer boozy milkshakes and 50 craft and bottled beers were derailed due to permit restrictions, but Taco Bell is exploring Southern California locales with less stringent alcohol laws for its next location. Also in April, Starbucks confirmed the broader rollout of Starbucks Evenings, an initiative that has been shown to drive traffic during the late-afternoon daypart and boost checks by inviting guests to swap lattes for wine and beer after 4 p.m.

Pierre Panos, CEO of Alpharetta, Ga.-based Fresh To Order, wanted to create “an elevated drinking experience” at his 12-unit fast casual by offering beer ($3 to $5) and wine ($5 to $8) by the glass. Customers can preload a debit card and swipe an iPad interface that allows them to pour their own drafts and kegged wine at the beverage bar, right alongside the concept’s popular green apple tea and vanilla mint lemonade. “Like theater, it engages them. And we don’t have to worry about the expenses of a full bar,” Panos says, although he also is testing that setup at one unit. Staff are trained to encourage guests to partake in the interactive drink experience, but it’s “an organic upsell. They are already coming in. Once they see our distinctive beverage bar, they come back,” says Panos.

Based on the success of the wine on tap program at their full-service Pizzeria Locale in Boulder, Colo., Bobby Stuckey and Lachlan Patterson made it a core feature of their fast-casual spinoff in Denver. “The wine has been very well received—we’re selling way more than we ever thought we would,” says Stuckey. At the fast-casual Pizzeria Locale, guests order $5 glasses or $21 carafes of red or white from the partners’ own label. “Having wine on tap helps control inventory and boost profits. There is no spoilage, no corked wine and no oxidized open wine to deal with,” says Stuckey.

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