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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 World of Beer, McMenamins, and Winking Lizard Taverns. Top-grossing nightclubs Marquee, Tao, and Lavo each have locations in New York City and Las Vegas. Leading companies in the less-fragmented UK market include pub operators Enterprise Inns and Punch Taverns, as well as the nightclub chain Luminar.

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 (about 35% of sales), distilled spirits or hard liquor (35%), food and nonalcoholic beverages (15%), and wine (about 10%). Companies may specialize in certain beverages, like craft beers or martinis.


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