Drinks On the House
It’s not a surprise to anyone in the foodservice industry that restaurants’ nonalcoholic beverage purchases are declining. They’ve been doing that for years. Still, there have been some growth segments—most notably premium, house-made drinks, including artisan sodas, cold-pressed juices, specialty iced teas, and smoothies.
Beverages carrying the title “homemade” increased 15 percent on limited-service restaurant menus during the 12 months that ended in November, according to market research firm Datassential. The growth in these drinks since 2012 is 46 percent.
Similar terms for beverages, such as “house-made” or “made in house,” are seen less but recorded triple-digit percentage growth over the past four years. At last count, nearly 7 percent of fast-casual menus have at least one “house-made” beverage, while those drinks show up at almost 4 percent of quick-service restaurants.
“Operators have to look for ways to differentiate themselves in a crowded market, and that becomes harder every day,” says Mike Kostyo, senior publications manager for Chicago-based Datassential. “One way is by creating new, exciting menu items,”
Historically, he says, nonalcoholic beverages haven’t been a great area of innovation in the limited-service restaurant space, as chefs tend to focus more on food. Many operators—even those serving local, creative, and fresh food—often defer to branded drinks.
“But all that has been changing,” Kostyo says. “A restaurant that takes the time to make agua fresca or lemonade from scratch stands out.” It also allows restaurants and their chefs “to carry over a flavor profile to the drink menu,” he adds.
It’s a trend that large beverage companies like Coca-Cola know well. Research for the Atlanta-based company by Mintel determined that nonalcoholic specialty beverages were expected to grow 16 percent during the 2014–2017 time frame. As a result, Coca-Cola offers recipes to turn the company’s branded beverages into a restaurant’s own specialty drinks, says Clare Pitt, Coke’s marketing executive.
There are trends that point to continuing strong appeal of homemade nonalcoholic drinks, says David Portalatin, vice president and food industry analyst at The NPD Group. One is the growth of the snack occasions between lunch and dinner.
“This is a time when specialty coffee does really well,” he says, adding that these occasions “tend to be more indulgent, so it’s also a good chance to try a beverage that is a little different, like a house-made soda or lemonade.”
Away-from-home dining tends to be more indulgent overall, adds Portalatin, who authored NPD’s recently published “Eating Patterns in America” report. The report found that while consumers are continuing to order fewer beverages overall when they eat out, sodas are still the most popular beverage of choice.
“It may not be consistent with their health goals, particularly millennials, but food and drink in those occasions are for more than satiation,” he says. “If you’re hungry or thirsty, there’s something in the pantry or refrigerator for that. But if you’re out, you’re looking for something different, and a hand-crafted soda would be relevant.” This also fits the trend in alcoholic beverages, notably for craft beers and artisan spirits.
There’s another big benefit of homemade beverages: the bottom line.
“The beverage part of the menu is a high-profit area, and when you add a premium for a drink made in house, there are even more opportunities [to make money],” Kostyo says, adding that it’s true even if there are higher costs involved, including labor and ingredients.
Much of the impetus for growth in upscale nonalcoholic beverages can be traced to the success and growth of coffee houses, beginning with specialty coffees. These stores have since branched out to handcrafted teas, sodas, smoothies, and juices.
McDonald’s brought part of that ethos to its beverage program when it launched its McCafé line in the U.S. in 2009 with specialty coffee drinks and added several smoothie flavors the following year. Two smoothie flavors continue on the menu.
These days, homemade beverages have become part and parcel of many limited-service restaurant operations, not just at coffee shops or juice bars. Take California restaurant chain Lemonade as an example. With a name like that, plus a menu featuring healthful, seasonal items, “it would be foolish not to have any lemonades on the menu,” says JoAnn Cianciulli, marketing director for the two-dozen-unit chain.
In fact, there are a half-dozen lemonade varieties on hand at any time. In addition to old-fashioned lemonade, varieties may include pomegranate tarragon, coconut apple and kaffir lime, cucumber mint, watermelon rosemary, and blood orange.
All of the lemonades are made fresh daily—a labor-intensive process that includes juicing and straining—from lemons, cane sugar, water, and other fruits, vegetables, and herbs that are in season. One option is also made to be sugar-free.
Many ingredients come from local farms, and the watermelon rosemary lemonade was the result of a bumper watermelon crop from an Oregon farm owned by Lemonade’s founder and chef, Alan Jackson. “Talk about farm to glass,” Cianciulli says.
Thanks to the natural ingredients, the lemonades have a range of vibrant hues, which are displayed in clear bubblers. “It’s almost hypnotizing to see this rainbow of lemonade,” she says. “People eat with their eyes, too.”
Lemonade is typically not the first thing you think about at a pizza parlor, but classic and blood orange versions of the drink are on the menu at Blaze Pizza, which also has homemade agua fresca, something more common at Mexican restaurants.
“From the time we first opened, we always wanted to have fresh-squeezed lemonade because it is so tasty,” says Bradford Kent, the Pasadena, California–based company’s chef. “People are opting away from traditional sodas, and lemonade is lower in calories and natural.” It’s natural because it is lightly sweetened with cane sugar, not corn syrup.
A frozen blood orange purée, along with some extra sugar and water, are added to the lemonade to make the blood orange version.
There are two agua frescas: a neon pink prickly pear and greenish key lime and mint. The flavors come as frozen purées that are mixed with a bit of the lemonade base “to add sweetness and a little more complexity,” Kent says.
The lemonades and agua frescas in bubblers display “vibrant natural colors” that enhance the dining experience, the chef says. Many guests mix these with other one-price-for-all drinks, including branded sodas, to create their own beverage.
At Chicago-based Native Foods Café, two creative homemade beverages, lavender lemonade and watermelon fresca, are “pillars of our brand,” says spokeswoman Rache Brand. “They are rich in vitamins, enhance the flavor of the food, and last beyond the meal,” she says.
The beverages are made in large batches at least once weekly “because it is very labor-intensive and time-consuming,” she says.
The recipes come from the vegan chain’s chef, Carolyn Corcoran; the lavender lemonade uses lemons, organic sugar, sea salt, and lavender flower petals, while the fresca features agave, mint, and organic watermelon that is heated and then cooled.
“We experimented with a lot of flavors, but watermelon was the one that stuck,” she says. A jackfruit fresca was offered for a short time last summer at the 14-unit chain’s incubator store in the Wicker Park neighborhood of Chicago.
While NPD found a decline in overall carbonated beverages at restaurants, artisan varieties are rising. Chicago’s Wow Bao has been serving its own house-made ginger ale for years, and Texas burger chain Twisted Root is known for its homemade root beer, available in original or flavored versions.
Roam Artisan Burgers, which has three units in the San Francisco area, has created a line of artisan, house-made sodas as part of its commitment to “give customers a better-for-you experience,” says Lynn Gorfinkle, co-owner and chief operating officer.
“Our goal has been to create a fun burger experience, so we have a whole line of gourmet burgers with nutrient-rich ingredients, and we wanted to pair that with a line of drinks that get away from using any corn syrup or refined white sugar,” she says.
As a result, some of Roam’s sodas are sweetened solely by the fruit in them, while others have added sweetening from agave. All are made to order, with the house-made syrup—prepared ahead of time—and other ingredients put in a glass and carbonated. Year-round flavors are Meyer lemon, ginger lime, prickly pear, and caramelized pineapple, with seasonal varieties such as coconut lime, blackberry, and blood orange. The juices used in the sodas are pressed fresh.
“What is really fun about the soda program is we are able to offer really unique flavors, and the guests really love it, “ Gorfinkle says. “It’s something you don’t see in a bottle.”
Freshly pressed or squeezed juices are part of the attraction at juice bars, but they are also showing up at limited-service restaurants best known for their food items. Take Cava Grill, the Washington, D.C.–based Mediterranean concept that features rotating juices.
“Our beverage program has a seasonality based on the produce and the market,” says Sarela Herrada, director of food and beverage for the 20-unit operator. “Our East Coast stores have some seasonal restraints. The West Coast ones have more options.”
The drinks pair different sweeteners with fruits, vegetables, and herbs, and the juices are pressed at each restaurant daily. The blackberry sage and cucumber mint juices both use agave. “One thing we like to do is have vegetable-forward ingredients, so that is why we are having a root vegetable beet lemonade [this year]. It’s a little outside the box.”
A number of restaurants now brew their tea in-house, but Cava Grill is among those that also make in-house flavored tea at each restaurant, including green tea with honey or spiced chai. A classic lemonade is made with cane sugar.
Freshly made juices and smoothies are major parts of the beverage program at Minneapolis-based Agra Culture Kitchen and Press. “They are an inferior product if they are not made in-house,” says founder and chief executive Aaron Switz.
The three-unit fast casual started by making its juices with cold-press machines, but switched to centrifugal juicers in order to make smaller batches and incur less waste. “We can make 10 [servings] at a time and make more if we need it,” he says.
While Agra Culture’s original food menu was salad-centric, it now has a busier kitchen with a whole range of sandwiches and plates, as well as breakfast. Still, it’s important to Switz that the juices and smoothies are as fresh and healthful as possible. Ingredients are prepared during slower times so that the end products can be made quickly.
There are typically five fresh juices available, such as the Carrot Zinger with carrots, apples, and ginger. Among the seven smoothies are the popular Nutty Espresso with cashew, bananas, espresso, dates, cinnamon, and almond milk, and the Greenie, which features spinach, ginger, apples, celery, parsley, and coconut water.
Making fresh juices and smoothies has an additional benefit beyond taste, Switz says. “The enzymes are more active right after the items are made,” he says. “We’re big believers in once it’s made, it’s consumed.”