Tag Archive | "off-trade"

Revenue Sales Fall by £2.2 billion in UK Beer Market


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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Decline in British Beer Sales Eases


Beer sales fell by 3.8 per cent in the first quarter of 2011 compared with the same period in 2010, according to the latest UK Quarterly Beer Barometer published today by the British Beer & Pub Association.

Both the on and off-trade showed a decline of 3.8 per cent, and the decline of sales in pubs has slowed, following an 8.8 per cent fall in the same period in 2010 – the lowest first quarter decline since 2005.

While the impact of the huge, 7.2% tax rise in the March 2011 Budget has yet to surface in the BBPA’s statistics, the BBPA says the good weather at Easter, and the extended bank holiday season may help the second quarter figures, as people flock to pubs to enjoy the Royal Wedding and the sunshine.

“Taken together, the fall in sales, and the impact of the Budget shows sales in the sector are still fragile. However, the on-trade’s performance relative to the off-trade has improved – and quarter two will be helped by the bank holiday bonanza and the good weather,” says Brigid Simmonds, chief executive of BBPA. “While it’s a pity that any recovery will be undermined by the huge tax hike, we still must make the most of the bank holiday season, and enjoy a celebratory beer or two in the nation’s pubs in the coming days.”

The British Beer & Pub Association is the UK’s leading organisation representing the brewing and pub sector. Its members account for 96% of the beer brewed in the UK and own nearly two thirds of Britain’s 52,500 pubs.

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Decline in UK On-trade Continues to Benefit Off-trade


Over the past year value has declined in the UK on-trade across most categories yet value has grown in the off-trade across all categories bar one, according to the latest market data from the Wine & Spirits Trade Association.

The off-trade shows value growth across all categories except fortified wine and volume growth in all categories except ales and fortified wine. The figures for the on-trade show volume decline across all categories of alcoholic drinks and value decline for all categories except standard lager and cider.

Research commissioned by the WSTA also suggests consumers looking to economise are more likely to cut back on going out for meals and entertainment in the next year.

A YouGov poll asked British adults what items of household spending they are likely to cut back on over the next 12 months:

* 46% said going out for meals

* 40% said going out for entertainment

* 34% said going out for a drink

* 20% said spending on satellite TV subscription

* 18% said they do not expect to cut back spending

The breakdown shows 50% of women and 50% of the 25-34 age group would cut back on going out for meals.

The findings are contained in the WSTA’s latest Quarterly Market Report, which features the latest data from leading independent sources including Nielsen and CGA Strategy with analysis by Tim Wilson, author of the Wilson Drinks Report.

Commenting on the figures WSTA chief executive Jeremy Beadles says: “The signs are that consumers remain cautious about their spending and will look to cutback on going out if necessary. However businesses that get the offer right are still doing well. Behind the headlines there are clearly opportunities for growth.  For example, golden rum sales in the on-trade are up in value by over 18% during the past year and sparkling wines are up over 11% in value in the off-trade.”

The WSTA is the UK organisation for the wine and spirit industry representing over 320 companies producing, importing, transporting and selling wines and spirits. Members include all the supermarkets, major off-licence retailers and online businesses, as well as drinks producers, fine wine specialists and logistics companies.

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Biggest Fall in UK Alcohol Consumption in 60 Years


UK drinkers are continuing to reduce their alcohol consumption, with 2009 seeing the sharpest year-on-year decline since 1948, according to newly published figures from the British Beer & Pub Association. This, and other major changes affecting the UK beer market are revealed in the newly published BBPA Statistical Handbook 2010.

There was a sharp, 6% decline in total alcohol consumption in 2009, making it the fourth annual decline in five years. UK drinkers are now consuming 13% less alcohol than in 2004. Indeed, UK consumption remains below the average for the EU.

UK taxes on beer remain among the highest compared with other countries, with the second highest duty rate in EU – ten times higher than in Germany, and seven times higher than in France.

The UK ale market increased its market share of all beers in 2009 for the first time since the 1960s. Ale’s success is also reflected in the number of UK brewers, which is now at its highest since 1940.

Beer is vital to pub sales. Beer generates 60% of all alcohol sales in pubs, hotels, and restaurants (the on-trade), compared to second-placed wine at 17%.

Total beer spend is £17 billion per year – 41% of all spending on alcohol. Of this £13.5 billion is spent in the on-trade (pubs, clubs and restaurants) and £3.5 billion in the off-trade (shops and supermarkets). A total of £26.5 billion is spent on alcohol in the on-trade.

The average price of a pint of bitter is £2.58 and lager is £2.95. London is the most expensive region to buy a pint, with prices 35% higher than in the north east.

Beer is a vital contributor to the Treasury, with £5.5 billion paid in duty and VAT. In total, alcohol contributes £14.6 billion to UK tax revenues.

Beer exports are up sharply. Around one billion pints of British beer are now exported, a UK success story worth over £460 million to the UK economy.

“These figures will confound many pundits, as yet again they confirm that as a nation, we are not drinking more. Those who suggest otherwise need to focus on the hard facts,” comments BBPA chief executive Brigid Simmonds. “The new numbers show just how closely linked beer is to Britain’s struggling pubs, with beer accounting for around 60%of on-trade sales. Policy-makers should take note.”

The British Beer & Pub Association is the UK’s leading organisation representing the brewing and pub sector. Its members account for 98% of the beer brewed in the UK and own nearly two thirds of Britain’s 52,500 pubs.

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