Report: Cheaper Gas Prices Could Mean Increased Spending at Restaurants
As gas prices hit the lowest point they’ve been in nearly four years, it could be good news for bars.
When Americans spend less on gas, it means they have more disposable income. Gasbuddy.com estimates Americans are saving an extra $110 million a day when gas prices are about $3 per gallon.
Americans, especially those who live paycheck-to-paycheck, are more likely to spend the money they save from cheaper gas. To boot, the economy is improving and the data experts predict a better Christmas season for all.
According to Deloitte, a data research firm, retail sales could rise by as much as 5% this Christmas season. At least some of that money will be spent in restaurants, bars and other entertainment venues after people tire of shopping.
Are Bars Immune From Internet Sales?
While brick and mortar stores have to contend with the Internet, which is expected to capture about 15 per cent of Christmas sales, shoppers can’t consume a drink or eat a meal online.
That doesn’t mean patrons won’t use the Internet to find a place to have a drink or meal. During the holidays customers are tired and want someone else to make decisions. Bars should make sure they have a positive online presence, especially with review sites like Yelp and Tripadvisor, so that they can easily capture the digital marketplace. These tools are widely used by out-of-town visitors looking for a well-reviewed establishment to have a drink or meal.
Gas Prices Don’t Hinder Customer Travel
So people have more disposable income. Being flush with cash isn’t the only reason bars might see more patrons. When gas prices are cheaper customers aren’t as discouraged from traveling. If your bar is a destination outlet, customers, who have been reluctant to go beyond the neighborhood because gas has been so expensive, might become more adventurous and want to explore new drinking establishments. Customers might be willing to travel to a bar that is 25 or 30 miles from their home if there is something attractive happening.
This might be a great time to roll out new marketing initiatives to attract customers who have never had the pleasure of visiting your bar.
Save On Transportation
An added benefit for bar owners is cheaper transportation costs. Whether you pick up your own products or have them delivered, bars might see a savings in shipping costs passed down from wholesalers. The price of many commodities like food is always subject to variables like weather and transportation costs. So if gas prices remain low, the bar might see some savings.
It’s always hard to predict how the price of commodities will impact businesses. There are always ups and downs, but a bar paying close attention to variables can seize an opportunity. It can use this moment to try new offerings to draw in new customers, customers who are looking for a new place to have a drink. Or it can launch a low-cost digital marketing campaign. How is your bar going to take advantage of low gas prices?