The rise of “philanthropubs” introduces a charity-based business model for bars and restaurants.
Brought to you by Liberty Mutual's
The Responsibility Project
Here’s some good news for beer enthusiasts: an increasing number of so-called “philanthropubs” means that beer drinkers can, as one Oregon pub advertises, “Have a pub, change the world.”
The New York Times reported on the trend of “a new generation of beer halls dedicated to something beyond the cash register…with proceeds going not into an owner’s wallet but to charity.” In an industry with notoriously high profits for business owners, this is an interesting business model. According to an article in the Washington Times, alcoholic beverage companies typically have profit margins that hover around 26 percent.
Now, according to The New York Times, those high profit margins will help line more pockets than just those of company owners. One of the pubs putting this new charitable business model into practice is the aforementioned Oregon Public House in Portland, where customers will be able to see the books – choosing from a list on the wall where they want their contribution to go. None of the pub’s board members will draw a salary (though employees will), and it has been able to stay open due mainly to grants and private donations.
Another bar owner, Raj Ratwani of Cause, in Washington, D.C., told the Times that its business model is based on research that indicates that young people give less to charity than their elders, but are “willing to chip in under the right circumstances.” The idea, according to Ratwani, is, “They’re going to find time to go out and drink no matter how busy they are.” In addition to Cause’s business model, others include worker-run, collectively managed brew pubs and bars in which patrons get to vote on which charity will receive the next month’s profits.
The beer-for-charity trend is on the rise in places as far flung as San Francisco and Hyderabad, India. Online, you can find a variety of charitable beer businesses, including the Seattle-based Beer Church and New Jersey’s Flying Fish Brewing Company, which released a limited edition beer to benefit victims of Hurricane Sandy.
Would you be more likely to donate to charity in the context of a philanthropub? Or is this new business model nothing more than a gimmick? Weigh in here.