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The spirits sector in Canadian bars and restaurants showed remarkable resilience in 2024, posting only a slight drop in volume even as overall on-trade alcohol consumption softened. New data from CGA by NIQ’s On Premise Measurement (OPM) service reveals that spirits volumes in Canada’s on-trade declined just 1.9% year-on-year. This dip – driven largely by weaker whisky and vodka sales – was notably milder than the 3.0% fall in beer volume over the same period. In fact, higher drink prices and a “quality-over-quantity” shift helped boost total spirits revenue by about 5% despite the volume slip. The result is that spirits not only outperformed beer in 2024, but also helped bars compensate for fewer drinks with bigger spending per serve, signalling an ongoing premiumization trend in Canada’s on-trade.
Virtually all major spirit categories saw volume declines in 2024 – yet tequila emerged as a rare bright spot. Whisky (-3.7%) and vodka (-1.5%) led the downward pull on overall spirits volumes, together accounting for nearly 40% of Canada’s on-trade spirit sales. By contrast, tequila was the only category in growth, inching up +1.1% in volume. Tequila now represents roughly 15% of Canada’s on-premise spirits by volume, and its modest gains hint at shifting consumer tastes toward agave-based drinks. This mirrors a broader pattern seen elsewhere – for example, tequila was a top performer in other markets like the US and UK, even as most spirit segments there declined. In Britain’s pubs and bars, tequila’s value sales grew 3.2% in 2024 while total spirits volume fell sharply. And in the U.S., tequila and ready-to-drink cocktails were among the few growing segments in an otherwise flat spirits market. The agave spirit’s momentum underscores how innovative flavors and cocktail culture are buoying certain categories against the overall headwinds.
Canada’s on-trade performance varied significantly by province, underlining the importance of regional trends. Quebec’s bars saw a slight increase in spirits volume, up 0.4% in 2024, making it the only province with growth. Alberta’s volume dipped just 0.9%, essentially flat, while the larger markets of British Columbia and Ontario saw steeper declines at -1.9% and -3.8% respectively. These nuances suggest local factors at play – for instance, Quebec’s relatively resilient volume may tie to its vibrant nightlife or consumer demographics, whereas Ontario’s larger drop could reflect a slower return to bars or more competition from off-premise drinking.
Pricing trends also differed across provinces. Quebec and B.C. led the country in price inflation, with the average price of a spirit serve rising +11.4% and +9.3% respectively in 2024. By comparison, price hikes were more modest in Ontario (+3.2%) and Alberta (+5.3%). The sharp jumps in Quebec and B.C. suggest that consumers in those provinces were willing to pay markedly more per drink, whether due to premium product offerings, higher operating costs, or post-pandemic demand. These higher prices may be nudging patrons toward quality over quantity – anecdotally, some bar-goers appear to be opting for one top-shelf cocktail instead of two well drinks. Notably, the price escalation has so far been absorbed without collapsing demand in those markets, contributing to spirits’ solid dollar sales growth.
The setting in which Canadians enjoy their drinks also influenced spirits’ performance. CGA’s data shows that food-led establishments (restaurants, eateries) saw a smaller drop in spirits orders than pure bars and nightclubs. Spirits volume in venues primarily focused on dining slipped just 1.7% in 2024, compared to a 2.7% decline in drink-led venues like pubs and clubs. In other words, Canadians are increasingly combining dining with drinking, helping restaurants better hold their beverage volumes. Going out for a meal – where a cocktail or whisky might accompany dinner – remained a reliable occasion, even as purely social drinking outings saw a bit more pullback.
This trend aligns with broader consumer patterns. In March 2025, 76% of Canadian consumers reported dining out in the past month, whereas only 42% went out “just for drinks”. With many consumers watching their budgets and health, a night out is more often centered on food, with drinks as a secondary treat. Even in those drinking-led nights, moderation is on the rise – recent surveys indicate a growing share of patrons consciously limit their alcohol intake or intersperse alcoholic drinks with non-alcoholic options. These shifts suggest that venues offering a combined food and drink experience – and a range of low-ABV or zero-proof alternatives – are well positioned to retain traffic. The dining experience is increasingly crucial for sustaining on-premise alcohol sales, as it captures both the eating and drinking spend in one visit.
Despite softer footfall in drinking-focused nights out, Canadians’ love for well-crafted cocktails is bolstering the spirits sector’s value. About 1 in 5 on-premise visitors (19%) ordered cocktails on their outing in the last month. Of those cocktail drinkers, a striking 86% were satisfied with the quality of their drink – and even more (87%) were pleased with how “exciting” the cocktail was, indicating that creative, high-quality recipes are hitting the mark. This high satisfaction suggests that consumers feel they’re getting their money’s worth from premium mixed drinks. Indeed, many are willing to pay extra for an elevated experience: nearly half of young adult patrons (age 19–34) say they’ve paid more to “trade up” to a larger or more premium cocktail serve in recent months.
This focus on quality over quantity reflects a broader premiumization trend sweeping the on-trade. Patrons may be going out slightly less often and drinking a bit less per visit, but when they do indulge, they’re opting for top-shelf spirits, craft cocktails, and interesting flavors. In Canada, this helped spirits dollars grow by ~5% in 2024 even as volumes dipped. A similar dynamic is visible in the U.S. on-premise: while overall spirits volume there fell about 6.5% in the past year, the premium and ultra-premium tiers have been gaining share as consumers gravitate to higher-quality brands. In the UK, too, industry data show premium spirits weathering the downturn better – premium segments increased their share of on-trade spirits sales by nearly 2 percentage points in 2023, even as cost-conscious drinkers cut back on standard offerings. Across these markets, drinkers are polarizing between “trading up” or “cutting back,” creating opportunities for both ends of the price spectrum. For bars and suppliers, the clear takeaway is that investing in cocktail programs, staff training, and premium inventory can pay off in a climate where consumers insist on an exceptional experience for their dollar.
Canada’s relatively small dip in spirits volume stands in contrast to more pronounced declines seen in other major markets’ on-trade, underscoring a comparatively strong post-pandemic recovery in Canadian hospitality. Figure 1 illustrates the difference – Canadian on-premise spirits volumes were down just 1.9%, versus an estimated 6–10% drop elsewhere.
Volume decline in on-trade spirits sales by market (Canada 2024 vs 2023, U.S. 2023 vs 2022, U.K. 2024 vs 2023). Canada’s decline was far milder than the drops seen in the US and UK.
In the United States, on-premise spirit sales have been under more pressure. CGA’s latest Impact Report found U.S. bars and restaurants’ spirits volumes fell 6.5% in 2023, with a 3.3% dip in dollar value. American consumers, squeezed by inflation, cut back on lower-priced “value” spirits in particular – the value tier saw double-digit declines – while premium brands held steadier. Beer remains king in U.S. bars, and even managed to grow share of alcohol sales by +0.5% through late 2024, alongside a surge in canned ready-to-drink (RTD) cocktails capturing +0.4% share. Those share gains came at the expense of spirits and wine, which slipped in share as some Americans opted for cheaper brews or convenient hard seltzers. Still, not all is grim for U.S. spirits: tequila’s craze continues (now exceeding 20% of U.S. on-trade spirit volumes) and the cocktail renaissance is strong, especially in urban hubs. Analysts note that the polarization of spending – some drinkers trading down, others splurging – defines the U.S. market, much as in Canada albeit in a more extreme fashion.
The United Kingdom’s on-trade has faced its own hurdles coming out of the pandemic and into a cost-of-living crisis. In 2023, total on-premise drinks sales in the UK grew a modest 1.3%, but spirits didn’t get to share in that uptick. Instead, UK spirits sales fell by 4.6% in value in 2023, and the slide only intensified into 2024 – with recent figures showing a ~10% plunge in spirits volume year-on-year. British pubs and bars have seen consumers shift spending toward beer (up to 42.9% share of on-trade value) and even soft drinks, as many patrons moderate their alcohol intake or seek cheaper alternatives. Major categories like gin and vodka have suffered double-digit drops in volume. Yet, similar to Canada, tequila and liqueurs have been surprise outperformers in the UK. Tequila demand held relatively firm (value up, volume only slightly down) and cream liqueurs actually surged by 6.9% in volume and 12.8% in value – perhaps driven by indulgent cocktail trends or seasonal favorites. These pockets of growth offer a silver lining in an otherwise difficult British market.
In summary, Canada’s on-trade spirits scene appears to be faring better than its U.S. and UK counterparts in terms of volume stability. Part of this resilience may stem from Canada’s diverse category mix – spirits consumption is spread across a wider variety of categories, whereas in the US a handful of spirits (vodka, whiskey, tequila) dominate the majority of sales. A diversified palate might be insulating Canadian bars from the sharper declines seen elsewhere. Additionally, Canada did not experience the same level of 2022 on-trade “boom” that the UK did, so year-over-year comparisons are gentler. Regardless, all three markets illustrate the common theme of an on-premise in flux: patrons are returning, but they are spending differently than before, and not every category is benefitting equally.
Looking ahead, industry experts emphasize that even in a challenging market, targeted opportunities for growth still exist. “Spirits volumes remain under strain in the On Premise channel, but we still see pockets of growth,” said Mitch Stefani, CGA by NIQ’s client solutions director for the Americas. He noted that suppliers and operators can unlock these opportunities through strategic, data-driven execution – for example, focusing on the right categories, occasions, and regional hotspots. Delivering great experiences is key. “Being a part of consumers’ positive experiences in the On Premise will not only create connections to specific brands and products but help with bringing consumers back to the On Premise,” Stefani added, reinforcing the importance of quality service and memorable drinks.
Industry watchers also point out that on-premise remains an essential brand-building arena. Trends often take hold at the bar before they reach the masses. Canada’s tequila growth, cocktail experimentation, and premiumization wave all started with early adopters in bars and restaurants. Suppliers who invest in this space – through staff training, menu innovation, or promotional partnerships – can shape these trends and benefit from them. Moreover, on-premise success tends to spill over into retail: satisfied bar patrons are more likely to purchase the same spirit for home consumption later.
In conclusion, while 2024 brought a slight downturn for Canada’s on-trade spirits, the broader picture is one of resilience and evolution. Consumers are going out with more purpose: seeking better drinks, in enjoyable settings, albeit a bit less frequently. The Canadian market’s solid performance relative to global peers is encouraging, but it comes with a clear mandate for the industry – to keep innovating, stay attuned to consumer preferences, and double down on the value of the on-premise experience. By doing so, the spirits sector can continue to thrive in bars and restaurants, even amid economic headwinds, and set the stage for renewed growth in 2025.
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