As many as one in four say they anticipate forgoing restaurants – and restaurant wine – in the future
A Florida consultancy predicts that restaurant spending could fall by as much as one-half by the time the pandemic ends. Even more surprising, says its study: Consumers seem content to cook and eat at home. If true, this has tremendous implications for the wine business.
That’s because about 40 percent wine sold in the U.S., measured by dollar sales, is sold in restaurants. So if that market goes away, there’s going to be even more wine glutting the market – and there’s already a glut.
And if that happens, we could be looking at lower prices but also more winery failures – and especially on the high end, since that’s where much restaurant wine comes from. This might also lead to more winery consolidation, which means less consumer choice. The biggest wineries have the deepest pockets, and will be better able to survive a massive glut.
The results come from Florida-based Acosta, in a study called “COVID-19: Reinventing How America Eats.” It described what seem to be massive shifts in consumer eating habits: 44 percent report eating breakfast at home daily, compared with 33 percent pre-COVID. Similarly, 31 percent are eating lunch at home every day versus 18 percent pre-COVID, and one-third are eating dinner at home daily versus 21 percent pre-COVID. All of those people eating at home, says Acosta, translates into 31 to 50 percent less spending at midscale, casual and fine dining restaurants.
Don’t panic yet
But let’s look at the caveats:
• Acosta didn’t respond to a couple of requests for an interview. The study is based on “online surveys of Acosta’s proprietary shopper community” in early July, as well as industry data and “proprietary information sources.” Proprietary means the company doesn’t discuss how the survey works, which means it’s OK to be skeptical about the results. We know how Nielsen measures sales; we don’t know how Acosta divines its results.
• On the other hand, Acogta’s pessimism about the future of the restaurant business dovetails with most of the gloom and doom prognosticated elsewhere. USA Today reported in early October that 2.3 million restaurant jobs have been lost during the pandemic, while 12 percent of sit-down restaurant chain units that were open before COVID-19 had closed.
• The 40 percent restaurant wine sales number is misleading, since it’s measured in dollar terms. Given that restaurant wines tend to be more expensive, and that restaurant markups inflate that total, the amount of wine sold in restaurants in actual bottles is probably much less than 40 percent of the U.S. total. Hence, the loss of the restaurant market wouldn’t be quite as devastating, and it would also be mitigated by people buing less expensive wine at the supermarket.
• Some of the results in the survey require a second look. For example, “35 percent of consumers said they’ve discovered a new passion for cooking amid the pandemic.” Which is all well and good, but does it actually mean anything? And one-fifth to one-quarter of the respondents say they anticipate eating out less in the future, which is understandable in July but may not mean much next spring.
So, yes, more not good news for the restaurant and wine businesses. But maybe, given all the bad news we’ve had, not quite as bad as it seems.