Bars & Nightclubs

Bars & Nightclubs

Brief Excerpt from Industry Overview Chapter:

Companies in this industry sell alcoholic beverages for on-premises consumption and may also offer limited food service. The industry mostly consists of small, single-location businesses, as inconsistent liquor laws make it harder to operate establishments in multiple states or countries. Some larger US-based bar chains include McMenamins, Winking Lizard Tavern, and World of Beer. Top-grossing nightclubs LAVO Nightclub, Marquee Nightclub, and Tao Downtown Nightclub each have locations in New York City and Las Vegas. Leading companies in the less-fragmented UK market include pub operators Punch Pubs & Co and Stonegate Group, as well as the nightclub chain REKOM UK.

COMPETITIVE LANDSCAPE

Personal income and entertainment preferences drive demand. The profitability of individual companies depends on the ability to drive traffic and develop a loyal clientele. Large companies can offer a wide variety of food, drinks, and entertainment, and have scale advantages in purchasing, financing, and marketing. Small companies can compete effectively by serving a local market, offering unique products or entertainment, or providing superior customer service. The US industry is highly fragmented: the 50 largest companies account for less than 10% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major sources of US industry revenue include beer (some 30% of revenue), distilled spirits or hard liquor (about 35%), food and nonalcoholic beverages (about 20%), and wine (over 10%). Companies may specialize in certain beverages, like craft beers or martinis.