The Great Lemonade Craze

Have you noticed that lemonade and other fruit drinks seem to be EVERYWHERE this summer?  The truth is that these aren’t just pretty drinks with a good taste.  If done right, these colorful beverages are elevating the profitability of some of the major chains in a meaningful way in 2023. 

As foodify experts, our question this week is a simple one.  What does your beverage offer look like? And is it foodifying your bottom line? 

As we have seen in recent years, in order to drive profits to the bottom line, every product must do its part.  And our N/A beverage option is no exception.  But the good news is that if done well, these small products can make a big impact on our profits each week.  

Here is our process to evaluate your beverages: 

Key questions: 

1. What is your margin on your traditional N/A beverage - in truth if you are serving bottles, you are giving up margins in this area.  Traditional cost of bottled beverages may be as high as 30%, whereas made in-house alternatives have a cost of 5-10%.  
2. Have you elevated this beverage - as we see from the larger chains, consumers CRAVE the elevated lemonade and other fruit juices.  By adding fresh fruit and a better presentation, we aren’t just able to increase our margins, we are able to increase our overall top line sales by increasing the cost of this item by $2+ dollars. 
3. Have you incorporated these fresh juices into alcohol drinks? Many consumers have embraced the canned cocktail craze, but just like the bottled drinks, canned cocktails will not generate the same margins as made in house beverages will.  

Foodify tip:  Evaluate your N/A beverage category as a percentage of sales for this week.  Based on this finding, our challenge would be to motivate your staff to create a new LTO item in this category that is made from scratch for the next 30 days.  Using social media, the summer heat, and a few additional posts, this product has the potential to excite our customer base AND foodify our bottom line!  

Larger goals for beverages moving forward: 

Beverages play a key role in our menu.  But is it really possible to increase sales in this area long-term? Sure, we can add a lemonade in August, but what difference will this really make on my overall profitability for the year? 

The truth is that it can drive more sales than we think.  For most restaurants, our N/A beverage should be at least 10% of our sales, but this varies widely among concepts and locations.  That being said, many times there are control issues that are causing us to not really see our true cost or revenue in this category. 

30 Day steps to profitability in N/A Bev: 

1. Remove the bottles - bottles will weigh down the overall profitability of N/A bev, as well as create a larger risk of shrinkage.  Cups of lemonade are harder to walk out the door than a case of lemonade.  
2. Review inventory check in this area.  How much product (bottles/juices/cans) do we order compared to what we actually sell.  Is there shrinkage in this area that is costing us money? 
3. Educate our team on the importance of N/A Bev - Is our team aware of the importance of ringing in beverages? Are they aware of the policy on taking bottles on shift? Do they inventory products regularly? 

Foodify tip:  When was the last time you watched your staff interact with your N/A beverage options?  Better profits to our bottom line don’t just happen.  Let's commit to foodifying our NA beverage this week in order to set a clear target on true NA Bev sales and costs.

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