Last Call for Alcohol!

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Friends of Branded!

Happy Saturday and I hope you had a great week!

“I don’t drink anymore,” says Schatzy, “I also don’t drink any less,” he quickly follows, and gives credit to his father for the (attempt at) humor.

Branded is all-in when it comes to the hospitality industry and for our portfolio of full-service / high-end restaurants, which now includes our friends & partners at LDV Hospitality , alcohol and wine play a big and important part of our business.

How big or how important are alcohol (including wine) sales to restaurants?

Great question!

Since I know the CEO of Branded’s portfolio company, Bite , Brandon Barton, prefers 140 characters or less answers, I’ll succinctly state that for full-service restaurants (that includes both fine & casual dining), alcohol can account for 20% to 30% of revenues!

For those that like a little more meat-on-the-bone when it comes to my answers (see what I did there?), alcohol sales are CRITICALLY important to the restaurant industry not just b/c of the sales, but even more so b/c of their profitability! Alcohol is an area where restaurants can drive both sales and margins, and it provides a sort of enhancer or leverage to the entire meal.

Below are some of the ways alcohol helps spike (??) profitability for restaurants:

• High profit margins: alcohol is a restaurant’s “money-maker,” and alcoholic beverages are typically marked-up in a range of 200% to 400% (or more). The price of that glass of wine you ordered, that’s typically the price the restaurant paid for the bottle.
• Increases the average check size: alcohol not only increases the check size for the venue, but also drives greater gratuities for the staff. Most guests calculate the gratuity based on the total price of the bill and don’t delineate between the food and alcohol.
• Enhances the dining experience: at full-service restaurants, guests expect alcohol to be part of their dining experience and a well-curated wine list, craft beer selection, or signature cocktails can elevate a restaurant’s reputation and attract more patrons. A joint known for its adult-libation offerings can be a key factoid in driving guest traffic and often leads to repeat business and guest loyalty.
• Events (private or otherwise) & Occasions: You’re having a special event? You’re going to want some special libations. Alcohol is more often than not, central to events (personal or professional) which tend to be profitable for restaurants. These events often involve group dining, where alcohol consumption is higher. It’s not you or me of course, but we all know people that tend to indulge a little more at corporate events than they do when they’re dining with their families. Again, it’s not us, but we know them.
• Pairing with Food: Venues with a strong emphasis on their culinary craft often look to pair alcohol with their food to create a more unique dining experience for their guests. “Pairing” food and beverages is a solid revenue enhancer for venues as it leads guests to want to enjoy in higher-end or more expensive beverage options. Pairings = gold!
• Bar-Only Revenue: Alcohol and specifically the bar is not just a nice area for patrons to wait until their table is ready. The bar is a revenue generator for the patrons that are waiting for their table as well as for those that may not be dining at the venue at all. Full-service restaurants can also create an independent revenue stream for those that want to enjoy drinks and a social environment and have no plans to dine at the venue.
• Lower Overhead Costs: As a former mixologist, I can tell you that alcohol requires less labor and can drive meaningful revenues for a venue. Alcohol also has a longer shelf life than perishable food items, which reduces waste, and helps control costs. For restaurants, waste = losses, unless you engage with Branded’s portfolio company, Copia , in which case donating food at 2x your food costs are a money-maker (but I digress or did I). ??

As I wrote above to Mr. Barton privately, alcohol can account for 20% - 30% or more of total revenue.

And that’s why the title of this week’s H^2 and the theme is “Last Call for Alcohol.”

Schatzy may not be drinking any more (or any less), but there are a whole lot of other people that are most definitely drinking less!

CONTINUE READING HERE

This week’s first Shoutout goes to one of our corporate partners, PepsiCo , a proud supporter of our Hospitality Hangout podcast!

PepsiCo is leveling up on flavor and giving consumers more ways to enjoy some of its best-selling products with DRIPS by Pepsi?, its new crafted beverage offering.

Tapping into the growing trend of consumers creating unexpected twists on their favorite beverages, DRIPS by Pepsi gives fans a premium experience with the brands they know and love in unique recipes crafted by expert mixologists. Fans can savor iconic PepsiCo products, from PEPSI??and MTN DEW??to ROCKSTAR??and Lipton??Iced Tea, enhanced with a selection of fruit syrups, creams, popping boba, fruits and berries, or other delicious mix-ins.

You can view a short clip with Scott Finlow, PepsiCo’s Global CMO Foodservice, on FOX showing the DRIPS truck and more info here: DRIPS by Pepsi offers a brand-new line of crafted beverages

If you find yourself in or around NYC/Brooklyn (or care to take a short trip) this weekend, the Pepsi DRIPS truck will be parked in Domino Park in Williamsburg from 1pm-7pm on Saturday and Sunday. See you there!

This week’s second Shoutout goes to one of Branded’s newest partner companies, ComAve , which is redefining the e-commerce experience with its innovative online platform that will include shopping experiences for the global sports fan community.

This week, ComAve and Arsenal announced a multi-year partnership will see the global e-commerce platform become Arsenal’s Official E-Commerce Marketplace partner.

ComAve will establish an innovative online platform that will include shopping experiences for Arsenal supporters globally.

Arsenal | Bringing supporters even closer to the action with ComAve as our Official E-Commerce Marketplace partner (Instagram)

Through ComAve, Gooners fans worldwide will have access to: ?? Interactive games and activities ?? Official merchandise and many more ?? Loyalty points for exclusive experiences and discounts!

Juliet Slot, Arsenal’s Chief Commercial Officer, shared: ““We’re proud to welcome ComAve as our first Official E-Commerce Marketplace partner. This new partnership supports our ambition to strengthen our connection with supporters globally by providing them with new and unique opportunities to engage with our club.”

Jassim Sulaiti, ComAve’s Regional Managing Partner, shared: "Arsenal is a leading global club, and partnering with them is a major milestone for ComAve. We are excited to offer supporters an unparalleled shopping experience and strengthen their connection with the club.

As for Branded, stayed tuned my friends. ComAve ambition is a truly global one and while I like to walk with a small stick, I don’t believe it’s a bold statement when I say that the US is a market that loves its sports, and our leagues and players have a truly global fan base!

And finally, yes, a third Shoutout only b/c this Branded portfolio company keeps making news!

I want to simply share an article from Entrepreneur on how Shaquille O'Neal Used an Unconventional Strategy to Start His Chicken Restaurant — Here's Why It Worked

Friend of Branded, Mr. Shawn P. Walchef captured this article and story wonderfully in his LinkedIn post this week and I wanted to share it here: Shawn P. Walchef + Shaquille O'Neal

How excited is Branded Hospitality to be partners with Big Chicken and working with this fast growing and emerging restaurant company, VERY!!!

Have a BIG day!

Branded invites readers of the H^2 that are interested in learning more about our portfolio companies, and investment strategies to become part of our Access Hospitality Network.

Request More Information

Featured Rewind:

Join Michael Schatzberg, “The Restaurant Guy,” and Jimmy Frischling, “The Finance Guy,” sit down with Lauren Bailey, CEO & Co-Founder of the Upward Projects Restaurant Group. Bailey shares her journey into the restaurant industry and the valuable lessons she's learned along the way. Steering five unique brands and 30 restaurants, Bailey offers insights on managing teams, embracing the unknown, and the importance of communication in a tech-driven world. From her hands-on leadership style to a fun encounter with Jimmy Buffet while bartending in Nantucket, Bailey’s stories are full of inspiration and humor. Tune in to discover her secrets to success and hear how she challenges Jimmy and Schatzy’s camaraderie with a playful quiz.

You can tune in on:

Spotify: Click Here

Apple Podcasts: Click Here

Watch on Youtube: Click Here

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Who made the B List?

FIND OUT HERE

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That’s it for today!

See you next week, (about the) same bat-time, same bat-channel.

It takes a village!

Jimmy Frischling Branded Hospitality Ventures [email protected] 235 Park Ave South, 4th Fl | New York, NY 10003

Branded Hospitality Ventures ("Branded") is an investment and solutions platform at the intersection of food service, technology, innovation and capital. As experienced hospitality owners and operators, Branded brings value to its partners through investment, strategic counsel, and its deep industry expertise and connections.