Bottoms up for British beer drinkers!
According to the latest ‘Beer Barometer’ published by the British Beer & Pub Association (BBPA) beer sales are on the rise, with overall growth of 1.3% in 2014. This was made up of a small slip of 0.8% across in-pub sales which was cancelled out by a 3.5% growth in off-trade sales. The boost put an end to a decade of decline and confirmed that Brits still have a taste for a pint, or three! This is incredibly exciting news given the fact that over the past ten years beer sales have plummeted by 24%. This represents a huge drop of 6.7 million pints per day.
Brigid Simmonds of the BBPA explains, “British beer is back in growth – and we want to keep it that way. But with seventy per cent of pub drink sales being beer, the picture for our much loved pubs is still fragile.”
Tax cuts lead to cheaper pints
So what’s behind the boom? According to Simmonds, the rise in sales in largely due to two historic beer duty cuts rolled out by the Chancellor last year. It’s somewhat ironic given the fact that colossal tax rises were pegged as the major cause of decline in the first place. From 2008 to 2013, beer duties underwent a sky-high 42% hike as part of the government’s beer tax ‘escalator’ policy. In monetary terms, this saw duty plus VAT rise from 42 pence to 65 pence on the average pint of brew. It was devastating for the British pub industry, as well as the wallets of punters. In fact, the hike was so substantial that it forced the closure of 7000 pubs and the loss of 58,000 jobs. With two cuts already in the bag the nation is calling for the Chancellor to introduce a hat trick of reductions in the upcoming March budget.
“That is why another duty cut from the Chancellor is vital. It will build on the success of two very popular tax cuts in the past two years, and boost jobs in an industry that employs 900,000 people, almost half of whom are 16-24 year olds. That has got to be good news,” said Simmonds.
So what can pub landlords do to make the most of the recovery? As well as introducing specials, marketing new beers and promoting their pubs every landlord should take out a comprehensive insurance policy. At the end of the day this will eliminate the risk of sales boosts being cancelled out by unexpected costs and keep both pints and punters protected around the clock.