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Revenue Sales Fall by £2.2 billion in UK Beer Market

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Revenue Sales Fall by £2.2 billion in UK Beer Market

Revenue Sales Fall by £2.2 billion in UK Beer Market
December 21
12:33 2011

Hindered by the decline of pub drinking and a lack of broader consumer appeal beyond men, the UK beer market has seen a huge fall from grace in the past six years. Indeed, while the market was worth £17.7 billion in 2006, it will command revenues of just £15.5 billion in 2011 – a £2.2 billion revenue fall – according to latest research from Mintel. Furthermore, volume sales decreased by almost a quarter (23%) over the same period, down from 4.1 billion litres in 2006 to 3.2 million litres in 2011.

 

The share of off trade as a total has gone up – highlighting a shift towards in home drinking. As more of the UK population drinks at home, beer – as with the likes of wine and spirits – has seen a greater share of its sales within this channel. However, unlike spirits and wine it has still seen its volume sales decline in the off trade – from 2.38 billion litres in 2006 to 2.25 billion litres in 2010.

 

Jonny Forsyth, senior drinks analyst at Mintel, comments: “The economic downturn and rising differential between on and off trade beer and alcohol prices has hit the pub trade heavily and led to more UK consumers migrating to in home drinking. Beer has been particularly badly hit – it suffers from being perceived as less suited than its competitors for in home drinking. This is because its male user bias makes it less of a compromise choice for couples than wine or spirits, and it is less associated with food matching or relaxing occasions than either of those drinks categories. The reason why beer is reliant on pubs is that it remains a core drink for young men – almost a rite of passage – and many choose it because in pubs, the size and price of a pint seem so much better value than most other drink options.”

 

Lager dominates the overall beer category and has therefore seen a greater loss of actual revenue over the past six years than ale and stout. Lager sales are down from £12.7 billion in 2006 to £11.4 million in 2011 – a 10% decrease which looks a lot better than it is, due to above-inflation price increases. In 2011, the value of the ale sector had declined to £3.3 billion and stout by £855 million. However, within the market, all beer types are struggling.

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