The results are in from our 2025 State of the Industry Survey!
Over 325 industry members participated in the survey, with the majority being owners/presidents/CEOs (45%). Respondents were evenly split between bars and independent restaurants at 37% each. Chain restaurants rounded out the top three at 9%.
This year’s survey comes at a time when the industry is facing strong economic headwinds in the form of continued inflation, increasing wages, and the threat of tariffs.
In fact, when asked about the economic conditions for the rest of 2025, most were pessimistic, with the majority (33%) saying they expect conditions to deteriorate marginally this year. Another 24% of respondents expect economic conditions to remain stable, while 20% are more optimistic and expect conditions to improve marginally.
Financial Challenges
It comes as no surprise then that the majority of respondents cited rising costs (43%) as their top challenge in 2025. Rising costs was the second most-named challenge (26%) in 2024. It seems clear that costs loom large in the minds of owners.
Another specter haunting owners is how to attract and retain customers (15%). This was also cited as their number-one goal for this year (35%) and last year (35%). Just like bar and restaurant owners, consumers have been feeling the pinch from inflation and a negative outlook on the economy, and as a result, on-premise traffic has suffered.
With less traffic comes less dollars, and the second most popular goal for 2025 was to increase revenue (29%).
Increased financial pressures and the need to grow revenue are two sides of the same coin for bar and restaurant owners in 2025. As rising costs surge to the top of their list of concerns — jumping 75% year over year — operators are not only trying to cut expenses, but also searching for ways to bring more money in. With consumer spending strained by inflation and economic uncertainty, attracting and retaining customers remains a top priority.
Solutions to On-Premise Challenges
So just how are bar and restaurant owners working to balance operational cost control with strategic revenue growth?
For the second year in a row, enhanced marketing (21%) emerged as the top solution, with owners once again turning to Facebook (31%) and Instagram (28%) for the majority of their marketing pushes.
But this year marks a shift: Where innovation and technology once offered hope in 2024, owners are focused on more immediate, pragmatic solutions in 2025 — raising prices (19%) and cutting costs (15%), both of which ranked much lower on the list of solutions in 2024.
To save money, many bars and restaurants are also cutting menu items based on cost, labor, and sales performance. When asked what they’re most likely to cut in 2025, common responses included “high-cost proteins,” “expensive beef cuts,” “imported ingredients,” “items with tariffs,” “low-profit items,” and “low-selling items.”
Investing: Products & Equipment
The economic outlook may be gloomy amongst bar and restaurant owners, but it doesn’t seem to be affecting their plans to invest in upgrades and new equipment as 68% said they will do so in 2025. Most (43%) plan on spending more than $20,000 on investments, which is an increase from 2024, when 35% said they planned on spending only $10-15,000.
The top two categories slated for investment, however, mirror last year’s, with kitchen equipment (53%) and restaurant supplies (52%) once again topping the list. The backbar is also on the minds of owners as 47% plan to invest in new spirits/liquor. This is a big jump from last year, as spirits didn’t even break into the top five investment categories in 2024. Glassware/tableware, which was the third-most popular category for investing in 2024, held steady again this year in the fourth spot (46%).
Another area of investment for bars and restaurants is in the growing field of artificial intelligence (AI). AI is increasingly reshaping how bars and restaurants operate. From AI-powered chatbots handling reservations to predictive analytics helping forecast demand and reduce waste, operators are using AI to cut costs and improve efficiency. On the customer-facing side, AI enables personalized promotions, smarter menu recommendations, and faster service—helping boost engagement and revenue in a competitive, cost-conscious market.
Our survey found that nearly 80% of respondents are at the very least interested in learning more about AI. Of that group, 28% are already using AI in some of their processes, while 19% are exploring their options and plan to add it soon. It seems like more owners are adopting the technology as in 2024 most respondents (29%) were only exploring their options.
Investing: People
There’s a common saying in the restaurant industry that your people are your greatest asset, and that truth became even more evident in the wake of the COVID-19 pandemic. As the industry faced unprecedented disruption, employees began to advocate for more rights and benefits, and owners realized that investing in their teams was essential to long-term success. In response, operators began placing greater emphasis on wages, benefits, and career development, aiming to create a more supportive and sustainable workplace.
And the trend is continuing into 2025. Our survey found that the people-driven “service” factor is the most important component in creating an unforgettable guest experience (56%). It was more than double the value of food and drink quality (25%) on the guest experience, an element that was the number-one component last year.
In addition, 21 states raised the minimum wage on January 1 of this year, with three other states planning increases later in the year. In our survey, 58% of respondents said they have raised wages, while another 19% are considering it. New this year, we asked those owners who have raised wages how it is affecting their businesses. The majority saw it as a boon for their workforce as 32% cited more satisfied employees.
Others, however, said it has contributed to economic strains by leading to increased prices (29%) and reduced revenue (19%).
It’s not a practice that will be going away anytime soon as seven states so far have made plans to raise the minimum wage again in 2026.
Trends: Consumer Demand in Food & Beverage
Employees aren’t the only group bar and restaurant owners are looking to please. Consumer needs and trends are also a big part of what ends up on menus and behind the bar.
For the second year in a row, vodka ranked as the most popular spirit in bars and restaurants. Tequila, the spirit used in the margarita, the reigning on-premise cocktail, came in second. There is discussion [link to Crompton article] about whether tequila is poised to soon overtake vodka in the on-premise, as more tequila-based cocktails grow in popularity.
Well drinks—gin and tonics, rum and cokes, etc.—ranked third in popularity. This could point to a consumer trend of trading down to save money amidst economic uncertainty.
Where the biggest surprises could be found, however, was in the “other” category for most popular cocktails. A few findings from the responses here included:
- The vodka-based cocktail, the Lemon Drop, was mentioned multiple times.
- Many mentioned house or specialty cocktails, indicating there’s a growing demand for customized, seasonal, or signature cocktails.
- RTDs were mentioned multiple times, showing that this category is getting some traction in the on-premise.
On the food side, appetizers came in as the most popular food item. In the age of Ozempic and wellness, this could reflect consumers’ desires for smaller or shareable meals. It could also point back to rising prices and the economic uncertainty facing the market. As budgets tighten, diners often opt for smaller, more affordable portions that allow them to enjoy a variety of flavors. Bars and restaurants should keep in mind that offering appealing appetizer options can be an effective strategy to attract cost-conscious guests and sustain sales.
Once again, there was much to be gleaned from the “other” category for most popular foods:
- BBQ & meat offerings (brisket, pulled pork, ribs, steaks) were mentioned most frequently as a popular category.
- Chicken, a crowd-pleaser and growing category especially in fast-casual concepts, was also frequently mentioned.
- Mexican food (tacos, burritos, etc.) emerged as another popular food category. Mexican is one of the top cuisines in the U.S., and it’s also the perfect meal to pair with a margarita!
Trends: Non-Alc is Here to Stay
One of the biggest trends of the last few years has been the non-alc movement. Rather than a passing fad, the industry has accepted that there’s been a dynamic shift in the way consumers imbibe.
Don’t believe us? The stats speak for themselves:
- In last year’s survey, 32% of respondents who didn’t offer non-alc cocktails said they didn’t see the trend lasting, whereas this year, less than half that figure (15%) felt this way.
- Non-alc cocktails were also one of the most frequently mentioned menu additions owners plan on making in 2025.
- With 82% of respondents offering at least a few non-alcoholic cocktails on their menus, it’s clear that these beverages have reached a point of saturation, becoming a staple rather than a novelty in today’s bar and restaurant landscape.
- Non-alc cocktails topped the list of food/beverage trends (20%) that owners foresee impacting their business this year.
As bars and restaurants face mounting financial pressures from rising costs and shifting consumer behaviors, their ability to adapt has never been more critical. Operators are balancing cost management with creative marketing and menu innovation—leveraging trends that drive both customer satisfaction and revenue growth.
In this evolving landscape, success will belong to those who can navigate economic challenges while staying attuned to what diners want most: value, variety, and a compelling experience.
Are you registered for our Crave and Crave on the Menu newsletters? Sign up today!
Plan to Attend or Participate in Our Events:
- Register Now for the 2025 Bar & Restaurant Expo Colorado, October 26-28, 2025, Denver, Colorado
- 2026 Bar & Restaurant Expo, March 23-25, 2026, Las Vegas, Nevada.
To book your sponsorship or exhibit space at our events, fill out our form.
Also, be sure to follow Bar & Restaurant on Facebook and Instagram for all the latest industry news and trends.