A nationwide alcohol shortage is causing headaches for bars and restaurants

Unlike some of the other supply chain issues during the pandemic, low supplies of liquor, beer and wine could have serious impacts on an operator’s bottom line as dine-in service resurges.

A massive alcohol shortage is threatening to derail the post-pandemic return to business for restaurants and bars around the country.

“It’s the top challenge for operators right now, aside from labor,” said Donna Hood Crecca, a principal at Restaurant Business sister firm, Technomic, where she leads the adult beverage practice for the company. “It’s like a perfect storm that’s happening and it’s causing some real migraines for operators to execute their full beverage program when they can’t get these products. It can create issues when you’re calling out a brand on the menu and you don’t have it.”

The industry has weathered shortages of everything from coins to ketchup packets during the pandemic, due to supply chain and other issues. But a shortage of liquor, wine and beer has the potential to have significant impacts on an operation’s bottom line.

This latest issue appears to be caused by a variety of factors along the entire alcohol supply chain, experts said.

There are staffing issues at ports and customs offices. Not enough truck drivers, dock employees and warehouse workers. There are also glass and aluminum shortages, causing slowdowns in bottling and canning of alcoholic beverages.

Last week, Pennsylvania’s Liquor Control Board instituted a two-bottle purchasing limit, per day, for all customers on a variety of bourbons, tequilas, champagne, cognac and more, citing “sustained supply chain disruptions and product shortages” beyond its control.

Ohio’s Division of Liquor Control reported it is not restricting purchases but that it is currently seeing high demand for bourbon, tequila and cognac. Suppliers were not able to keep pace with 24 of the top 521 alcoholic beverage items on any given day this year, the agency noted in an email to RB.

Media reports detail alcohol supply issues around the U.S.

Tequila, especially premium bottles, is especially hard to come by right now, Hood Crecca said.

“The demand for tequila is definitely outstripping supply,” she said.

Michele Fire, owner of Chicago’s Tweet Let’s Eat and Big Chicks, said she was unable to source Absolut vodka from her distributor and had to select a different brand.

“It’s painful ordering liquor,” Fire said.

In Milwaukee, Gregory Leon, owner of Amilinda, has had the toughest time sourcing Spanish and Portuguese wines for his restaurant.

“The importers are having a hard time getting stuff in here,” Leon said. “It’s either held up at the docks or it’s held up in customs, or it’s held up in the country of origin.”

Leon said he typically likes to switch his wine menu up frequently, but supply uncertainty has made that tricky. Before the pandemic, Amilinda had 20 bottles on its wine list; now, because of supply and cost issues, that list has been cut in half.

The timing is especially unfortunate as diners in much of the country return to in-restaurant dining, Hood Crecca noted.

“We’re seeing restaurant operators, they’re prioritizing their adult beverage offerings because the drink menu, the bar brings people in, drives check averages and delivers tremendous profitability,” she said. “There’s pent-up demand. Consumers want to go out, they want to socialize, they want to connect. To not be able to satisfy that demand, is really concerning.”

Hood Crecca advised having a well-trained staff who can suggest alternate beverages with similar flavor profiles, should something be out of stock. She also suggested a streamlined drink menu.

So, when might the alcohol shortage ease?

“Honestly, I don’t know and I don’t think anybody does,” she said.

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