When Sonic Drive-In announced in late June that a Florida unit would begin selling beer and wine, it ignited a firestorm of reaction as observers weighed in on the implications.
Most controversial, according to comments made online by readers, was the idea that an establishment specializing in drive-in service would promote alcohol consumption. Others pointed to the fact that many fast-food workers are too young to serve alcohol.
But even as the notions of ingesting a fast-food meal and relaxing over a glass of wine may seem at odds, a number of quick-service purveyors are looking to reconcile the two — and overcome the operational hurdles — as they hunt for additional revenue and new ways to enhance the customer experience.
Sonic, which assured concerned observers that only customers dining on the patio would be served alcohol, is joining such operators as Starbucks, Burger King and Burgerville in beer and wine experiments. These brands in turn are following a lead increasingly common at fast-casual chains, where the practice of serving alcohol is prevalent but underplayed. For example, Chipotle, where the emphasis is on “food with integrity,” offers beer and margaritas in most of its 1,000 units, according to filings with the Securities and Exchange Commission.
Happier hours
Starbucks is testing eight wines by the glass, priced at $7 to $9, and five bottled beers, each priced at $5, in four Seattle stores and one in Portland, Ore.
The Seattle-based coffeehouse chain, which has nearly 11,000 domestic units, is aiming to build traffic and sales later in the day, when business is significantly slower than that fueled by commuters in the mornings. Four of the test stores are branded Starbucks. During previous experimentation on menu and decor, some Starbucks stores have had different names.
Clarice Turner, senior vice president, U.S. retail for Starbucks, who is overseeing the test, said it was prompted by requests from patrons for additional food and beverage selections.
“They are letting us know that they would like to have more options than they currently have for relaxing in the stores in the afternoon and evening,” Turner said.
Starbucks is studying whether a modified concept — such as its Olive Way location in Seattle, one of the five stores testing wine and beer — can encourage patrons to visit later and linger longer. The unit was remodeled to feel more like a cafe and less like a specialty coffee bar, with softer lighting and more comfortable seating. It offers a menu of shareable items that go well with wine and beer in the evening, such as plates of cheeses and cured meats.
“There is no news to report quite yet, but we are quite pleased with what we see so far,” Turner said.
Patrons are using the new beverages in a way that fits the “third place” that Starbucks aspires to be, a public gathering spot apart from home and work, Turner noted.
“In our stores you will see collections of friends or business associates sitting around a table, similar to the way people do in European coffeehouses — one person having coffee, another person having tea and another having a glass of wine,” she said.
“We provide a convenient connecting place for them to hang out, as we have for many years — the third place,” Turner added. “It’s just the third place at a different time of day.”
With its foray into wine and beer service, Starbucks is exploring ground that limited-service establishments generally have found daunting, according to industry observers.
“It’s just not in the DNA of a traditional QSR to sell alcohol,” said David Henkes, vice president of Technomic and head of the on-premise beverage alcohol practice for the Chicago-based research firm. “But I think chains are recognizing that there is potential there for some incremental revenue, so they are taking some baby steps to see if it is possible.”
Among the hurdles to surmount are beverage-licensing requirements around the country that are complex and expensive for national chains to manage, Henkes said. In addition, there are operational issues to solve, such as storing beverage inventory in small-store footprints. Even more challenging is the cost of training a large workforce in responsible alcoholic-beverage service. For a traditional QSR with numerous employees under age 21, the latter is especially problematic, he said.
“For a quick-service restaurant, where it represents maybe 1 percent or 2 percent of sales, the benefits of selling it don’t outweigh the costs,” Henkes said. “So I would certainly not say we would see alcohol become a standard item on most QSR menus.”
Relaxing respite
Still, limited-service eateries with the right mix of location and clientele might benefit from an alcoholic-beverage program as a concept enhancer, something Burger King is exploring with its Whopper Bar.
Alcohol seems to fit more easily in quick-service eateries located in tourist or entertainment settings that serve a largely adult clientele, as opposed to on Main Street. For instance, beer is on the menu of three of Burger King’s six Whopper Bars in the United States, including the Whopper Bar in the Rio All-Suite Hotel & Casino in Las Vegas, which is open 24 hours. Officials at the Miami-based chain declined to be interviewed for this story.
Sonic also is focusing on leisure clientele at the new Sonic Beach concept in Homestead, Fla., a modified unit designed for the South Florida market. It offers wine and beer to customers of legal drinking age who dine on the restaurant’s shaded patio, which has seating for 40, 10 flat-screen TVs, a sound system and a sandy beach area. The patio is open until 1 a.m.
The 3,359-unit Oklahoma City-based chain, which announced in late June that a second Sonic Beach unit was scheduled to open in August near the beach in Fort Lauderdale, Fla., said there are no plans to roll out the alcohol offerings nationwide.
For Moe’s Southwest Grill, the decision to menu beer, wine and Moe-Ritas — wine-based margaritas — is made at individual locations.
“It is offered where it makes sense, such as in restaurants in college towns,” said a company official. All told, alcohol is served at fewer than 10 percent of the Atlanta-based fast-casual chain’s 430 units.
One of the ways an alcoholic-beverage offering can pay off is by countering the veto vote when patrons decide where to eat, Henkes said.
“It may not be an extra reason to go to a restaurant, but it may be an extra reason not to say ‘no’ if the other people with you want to go there,” he said.
At the two Yeah! Burger fast-casual spots in Atlanta, an ambitious beverage program that offers nine signature cocktails, eight premium wines and 21 beers, five on draft and 16 in bottles and cans, proves its worth as “an intangible marketing opportunity,” in the words of chef and co-owner Shaun Doty.
“Alcohol consumption is pretty modest in terms of our gross sales,” Doty said. “I thought I would get more of a late-night crowd that would drink, but that hasn’t really happened.”
But the beverage program does attract guests and boost food sales, albeit in a way that is hard to measure.
“That one person who wanted to have a glass of wine with their meal brought in six or seven other people, and that drove our food sales,” Doty said.
Consuming advantage
Noodles & Company, the Broomfield, Colo.-based 260-unit fast-casual restaurant chain, also is finding alcoholic-beverage service to be a concept enhancement. Although wine and beer sales amount to less than a couple of percentage points of total sales, the products nevertheless have an important bearing on the overall appeal of the concept, said chief administrative officer Dawn Voss.
“Because we serve on china and use real silverware and we deliver food to the table, we really feel [offering beer and wine] enhances the experience of eating with us and takes us further away from the quick-service experience,” Voss said.
That is particularly important because Noodles competes with many casual-dining chains that offer beer and wine, she said. A store generally carries six or seven beers and wines, merchandised in a bottle display on the store counter and depicted on the menu board overhead. Wines are priced at $5 per glass, $17 per bottle, with mainstream domestic beers priced at $2.95 and premium selections at $3.95.
Some fast-casual operators have invested their beverage lists with a scope and quality that rivals full-service restaurants. For instance, Yeah! Burger patrons can sip a margarita made with fresh lime juice and served in a glass rimmed with Hawaiian black sea salt. They also may choose a Belgian Tripel Ale on draft or a California Central Coast Syrah that Doty touts as “the ultimate burger wine.”
“You would find that wine on a menu in a four- or five-star restaurant priced at $12 or $14 a glass, but we sell it for $6.49,” Doty said. “We are trying to get people excited about drinking these fine wines.”
To ensure that red wines such as the Syrah are served at proper cellar temperature in steamy Atlanta, Doty has purchased wine refrigeration units for each restaurant.
“These refrigeration systems were $3,000 apiece,” Doty said. “But I want consistent quality in the wines I serve.”
Some operators are playing up regionally produced beers and wines and local favorites on their beverage lists. At the five Starbucks stores that are testing beer and wine, four of the six microbrews are from Oregon. Wines include Washington Riesling and Oregon Pinot Gris and Pinot Noir. Rounding out the list are beers from Alaska and Belgium and wines from California, Argentina and Italy.
At Noodles & Company, restaurant managers are encouraged to choose locally popular craft brews in addition to stocking mainstream domestic brands of light and full-calorie beer.
“Here in Colorado most of the restaurants are carrying beer from New Belgium [Brewing company], which is very popular,” Voss said. “In Oregon we also use the local beers and wines. In some places in the Midwest, where there isn’t as much of a culture of craft beer, we sell mainly the mainstream beers.”
In addition, some Noodles & Company restaurants pick up a Japanese or Chinese brand of beer to accompany Asian-inspired dishes.
At Serious Burger, an Appleton, Wis., fast-casual restaurant where the natural beef burgers are topped with upscale ingredients like truffle fries and organic-farm eggs, chef-owner Marc Waltzer carries as many as 20 beers, many of them from the home state’s brewing industry.
At Happy Hour on weekdays, he pours a draft Wisconsin microbrew priced at $1.99 per glass, reduced from the usual $4.75. In addition, one of his specialties is a beer float made by suspending a scoop of dark-chocolate ice cream in a glass of coffee-flavored stout from a brewery in Green Bay, Wis.
“I’m addressing local products whenever possible,” Waltzer said.
Nix the bar scene
Although selling beer and wine in fast-food eateries is a long-accepted practice in Europe, the idea is controversial in the highly regulated beverage environment on this side of the Atlantic. Obviously, the consequences are severe for those who run afoul of the law and serve alcohol to patrons who are intoxicated or underage.
In the Starbucks stores that are testing wine and beer, employees complete a comprehensive training program such as Washington state’s Mandatory Alcohol Server Training.
“This is not a bar scene in our customers’ minds,” said Starbucks’ Turner. “They still look at us as a coffeehouse, a place to meet friends and relax or study.”
At Noodles & Company, only managers, not hourly employees, serve wine and beer. All managers are certified in the National Restaurant Association Educational Foundation’s ServSafe responsible beverage service training. Store registers have a prompt that reminds the seller to check the customer’s ID when ringing up alcohol.
“We are very, very cautious because we want to make sure we fully follow the liquor laws and don’t make mistakes,” Voss said. “And, obviously, we don’t want to move in the direction where people come to us to drink heavily. That would ruin everybody’s experience.”
