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Food & Beverage Industry

Soju exemption spurs cocktail sales by beer-and-wine licensees on both coasts

Nation's Restaurant News, Sept 26, 2005 by Alan J. Liddle

SACRAMENTO, CALIF. -- Non-Asian restaurants holding only beer-and-wine licenses are exploiting legislated leeway to merchandise cocktails made with a 48-proof spirit called soju, which was exempted from restrictions by California and New York lawmakers in cultural concessions to unlicensed Korean eateries.

Distilled-spirits lobbyists have cried foul over the exemptions, which allow restaurants without bars to compete for cocktail-thirsty customers against operators holding expensive liquor permits.

Meanwhile, several mainstream chains licensed only to sell beer and wine are using fancy cocktail menus boasting trendy concoctions to boost beverage sales, helped by servers who unofficially tout the low-cost distillate as "soju vodka."

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In Los Angeles, New York and other markets with immigrant populations, soju for years was served in little cups as a traditional libation at many Korean restaurants that lacked even beer permits yet escaped notice by regulators. But the legislative waivers granted by California in 1998 and New York in 2002 also made soju fair game for other kinds of restaurants that liked the idea of generating cocktail revenues without having to make expensive investments in spirits licenses.

Another attraction of soju is the low cost of the Korean import, which can retail in some immigrant neigborhoods for as little as $3.95 for a standard-size bottle despite importation taxes that have stiffened.

"It's not like having a bar, but it's a good alternative," said Adriano Paganini, founder and chief executive of San Francisco-based Pasta Pomodoro, a 45-unit Italian dinnerhouse operator that is partly owned by Wendy's International.

Cocktails made from soju, which has about 60 percent of vodka's alcohol content and two to three times as much as most wines, "are actually pretty good if you create specific recipes that complement the lighter flavor," Paganini said.

He currently offers a slate of seven $6.50 soju cocktails at eight of his chain's California restaurants and plans to add them at other branches "wherever we need more sales and wherever it fits." In addition to such varieties as a Cosmo, a Green Apple Martini and the Creamy Espresso Martini, Pomodoro restaurants feature the "Paganini," described as "simply soju and a sprig of rosemary."

Pomodoro Cucina Italiana and Pasta Pomodoro outlets "that do less family business," such as in San Francisco's Castro District, are a good place to start introducing the beverages, said Paganini, whose restaurants merchandise soju as a "premium, Asian-inspired vodka-style cocktail."

With roots tracing back to Korea and Japan in the 1300s, soju originally was made from sake, but today it typically is distilled from rice and barley, though some brands are made from sweet potatoes. Despite soju's 48-proof designation, or 24-percent alcohol content by volume, laws passed at the behest of Korean restaurateurs--though so far only in California and New York--apparently allow the spirit to join beer and wine on the alcoholic beverage menus of thousands of restaurants.

Although profits yielded by soju cocktails presumably are high, efforts to determine the costs paid by restaurants supplied through distribution channels were not successful, and operators did not divulge their drink margins.

Traditionally served at Korean restaurants straight up in teacup-style glasses or on the rocks with meals, soju is being been sold in cocktail form in California and New York by beverage-savvy independent operations. Among them is Bodega Wine Bar in Pasadena, Calif., which has offered soju drinks since January 2004.

"We had a beer-and-wine license and wanted more of a selection to offer," owner Greg Seares said. "Sales jumped after we added [soju]." His wine bar sells the cocktails for $8 and generates about 15 percent of its total alcohol sales from them. Seares' biggest seller is a blend of soju and a popular, name-brand energy drink.

Such results may have influenced beverage menu changes by the likes of 41-unit BJ's Restaurants Inc., the Huntington Beach, Calif.-based operator of a fast-growing, high-grossing chain known for deep-dish pizzas, micro-brewed beers and an outsize chocolate-chip-cookie dessert for sharing called the "Pizookie."

BJ's oulets, like the Pomodoro restaurants, use table tents that evoke martini-glass imagery and lounge-like descriptions to promote cocktails made with soju, which servers often describe as being like vodka.

Pasta Pomodoro promotes the drinks with table tents that urge diners to "sip into a soju sojourn; soju is our Asian inspired vodka-style cocktail." Because the chain's restaurants have no bars, the specialty libations are prepared by the wait staff at the station where they also pour a selection of varietal wines.

Among the Pomodoro restaurants' cocktails, the Creamy Espresso Martini includes soju, espresso, heavy cream and three espresso beans. The "Reverse Cosmo" is made with white cranberry juice and a splash of imported Italian orange-flavor syrup.

Food & Beverage Industry

Soju exemption spurs cocktail sales by beer-and-wine licensees on both coasts

Nation's Restaurant News, Sept 26, 2005 by Alan J. Liddle

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