Stricter pricing regulation has contributed to a sharp decline in alcohol consumption at bars and nightclubs
New York, NY (PRWEB) February 26, 2015
Operators in the Bars and Nightclubs industry have struggled under the weight of a number of social trends, including more people consuming alcoholic beverages at home rather than at bars and nightclubs. Rising alcohol prices, wariness of drunk driving and evolving attitudes toward alcohol consumption have negatively impacted the industry. Per capita consumption of alcohol has declined over the five years to 2015, and the decline in alcohol consumption in bars and nightclubs has been even sharper, in part due to stricter pricing regulation. Furthermore, the industry has faced strong competition from other industries that serve alcohol, such as restaurants, as well as alternative forms of entertainment. As a result of these trends, industry revenue is expected to decline over the five years to 2015.
Industry operators have attempted to respond to these challenges by diversifying into a range of new concepts such as wine bars, cocktail lounges and brewpubs to attract new demographics. According to IBISWorld Industry Analyst Andrew Alvarez, “new operators are consistently entering the industry to satisfy emerging consumer trends.” As drinking establishments cater to a larger range of niche markets, the industry has become more fragmented. Many of the remaining establishments have adapted their menus and entertainment offerings to accommodate consumer tastes. Industry revenue is expected to remain flat in 2015, primarily due to tepid consumer confidence and a continued decline in per capita alcohol consumption.
“Industry operators will continue to contend with increasing competition from at-home alcohol consumption and other forms of entertainment over the next five years,” says Alvarez. However, the improvement in the broader economy is expected to drive bar and nightclub spending, especially as establishments focus more on ancillary product lines, like food services and live entertainment. Consumer spending is expected to continue growing over the next five years, driven by higher employment and disposable income growth. As a result, industry revenue is expected to increase over the five years to 2020.
For more information, visit IBISWorld’s Bars and Nightclubs in Canada industry report page.
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IBISWorld industry Report Key Topics
The Bars and Nightclubs industry includes bars, taverns, nightclubs and drinking places that serve alcoholic beverages for immediate consumption. These establishments may also provide limited food services.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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