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How the surgeon general’s advisory on alcohol could impact restaurant sales

  • Alicia Kelso
  • 6 January 2025
  • 3 minute read
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This article was written by Restaurant Hospitality. Click here to read the original article

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Last week – and just in time for Dry January – United States Surgeon General Dr. Vivek Murthy issued a new advisory outlining the link between alcohol consumption and increased cancer risk. In the advisory, he noted that alcohol consumption is the third leading preventable cause of cancer in the United States, after tobacco and obesity.

The scientific evidence supporting this link, the advisory adds, has been “growing over the past four decades,” however less than half of Americans recognize it as a risk factor for cancer. Murthy recommends steps to increase awareness about the alcohol/cancer connection, including an update to the existing surgeon general’s health warning label on alcoholic beverages, a reassessment of guideline limits, and expanded educational efforts from public health professionals and health care providers.

The current warning label on alcoholic beverages states that women who are pregnant should not drink alcohol due to the risk of birth defects, and that consumption impairs the ability to drive a car or operate machinery. It also says alcohol, “may cause health problems.”

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With Murthy’s recommendation, that last part would be far less vague, including a warning about cancer risks. Any such change to the current language, which was first added in 1988, would need Congressional approval, so it is early days on this discussion.

That doesn’t mean restaurant operators shouldn’t be paying attention, however. Such a barrage of messaging does have an ability to create change. This is perhaps most clearly evidenced by the surgeon general report in 1964 warning of the health hazards of smoking. Since then, the percentage of Americans who smoke has dropped from 42% to about 11% in 2022. If alcohol usage follows that same downward trend, restaurants that sell alcoholic beverages could take a massive hit to their bottom lines. Alcohol-based beverages currently represent about 21% of total sales at full-service restaurants that sell them, according to the National Restaurant Association. That number is even higher at fine dining establishments. At limited-service restaurants that sell alcoholic beverages, they make up 6% of sales. The association does not have a statement about the surgeon general’s advisory at this time.

Of course, it’s far too early to know whether a warning label or broader campaign will be a priority for the incoming Trump administration, or if it will come to fruition at all, and there is sure to be aggressive push back from alcohol companies. But many of those companies’ stocks plummeted last week after the surgeon general’s recommendation, meaning that the conversation alone is having an impact.

That said, even if the surgeon general’s recommendation is removed from the equation, a much broader conversation has been happening for the past couple of years that operators should be paying attention to. Simply put, consumers – specifically younger consumers – drink far less alcohol than their older counterparts. About one-third of consumers ages 18 to 24 don’t drink alcohol at all, according to Mintel. Those that do drink, drink significantly less – about 20% less than millennials did at their age, according to Berenberg Research. So, if your establishment heavily relies on alcohol sales and profits, it may be time to complement those offerings with alternatives to win over the fast growing sober or sober-curious veto vote.

Contact Alicia Kelso at [email protected]

Please click here to access the full original article.

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