Bars & Nightclubs in the US Industry Market Research Report from IBISWorld has Been Updated
High unemployment and low disposable income during the recession drove down consumers' budgets. As people cut down on spending across the board, luxuries like trips to bars and nightclubs were among the first to be cut, and the industry's financial performance suffered. A rising trend of consumers preferring to drink at home has also been posing a threat to the industry over the past five years. Nonetheless, economic improvement is expected to gain momentum starting in 2013, driving a greater number of discretionary purchases. This trend will likely bring the industry back to solid revenue growth in the near future. For these reasons, industry research firm IBISWorld has updated a report on the Bars & Nightclubs industry in its growing industry report collection.
Los Angeles, CA (PRWEB) October 28, 2012
Having emerged from the recessionary decline, the Bars and Nightclubs industry turned around in 2010 and made strides in 2011, with revenue growing 3.5% for the year. Industry revenue is expected to grow an additional 3.2% to $22.7 billion in 2012. This growth will keep the industry's average annual revenue change relatively flat over the five years to 2012. During the period, IBISWorld estimates that revenue has declined at an annualized rate of only 0.7%. According to IBISWorld industry analyst Nima Samadi, “a disappointing early half of the past five years, when the Bars and Nightclubs industry's financial performance suffered amid slower consumer spending and changes in alcohol consumption patterns, is the primary reason behind the overall contraction.” In 2009, for example, revenue plunged 9.3%.
The general state of the economy and alcohol-related trends drive the Bars and Nighclubs industry's financial performance. The recession and the high unemployment rates that accompanied it forced people to become more cautious with their money, with consumer spending falling 1.9% in 2009. As people cut down on spending across the board, they were less likely to factor luxuries like trips to bars or clubs into their budgets. With a breakthrough in the economy in 2010, however, consumer spending grew 1.8% and another 2.5% in 2011, which has resulted in a rise in trips to these venues. Spending is forecast to continue rising in 2012, growing 1.9%. “While a rebound in consumer spending will continue to benefit the industry, consumer preferences regarding the types of alcohol that are consumed and the manner in which they are consumed will continue to pose a threat,” says Samadi. While total alcohol consumption is forecast to fall at a marginal rate of 0.1% per year, a rising number of consumers now prefer packaged beverages to drink at home rather than alcoholic beverages at clubs or bars.
Over the next five years, the industry is projected to continue facing competition from in-home alcohol consumption and nonindustry establishments that also serve alcohol, like restaurants. This competition is expected to pull the number of industry establishments and employees down over the next five years. Nonetheless, because the industry is highly fragmented and most establishments are family owned, industry concentration is not expected to change significantly over the next five years. Even amid this threat of competition, the industry's financial performance is expected to strengthen as the economy improves and consumer spending increases. In the five years to 2017, industry revenue is forecast to increase at a moderate rate. For more information, visit IBISWorld's Bars & Nightclubs in the US industry report page.
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IBISWorld industry Report Key Topics
This industry comprises bars, taverns, pubs, lounges, nightclubs and other drinking places primarily engaged in preparing and serving 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
About IBISWorld Inc.
Recognized as the nation's most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
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