Speaking after JD Wetherspoon, a leading UK-based pub chain, last week said that it was cutting drink prices, with pints of beer at 99 pence (€1.05), trade group the Brewers of Europe said it welcomed any boost to the UK’s ailing pub industry.
Opinion appears to be divided amongst some brewers though over how the price cuts may affect their fortunes amidst the current economic uncertainty.
Beer pricing, like with all alcoholic drinks, has become an increasingly difficult issue in recent years for manufacturers and retailers, amidst concerns from both health groups and the industry over balancing responsible consumption and profits.
Pub fears
By the end of last year, the Campaign for Real Ale (CAMRA), an organisation founded to campaign for both consumer rights and pub protection, said that about 7,500 bars could be closed by 2012 unless government can supply some form of protection.
The group claim that government measures such as increasing Value Added Tax (VAT) on alcohol are causing consumers to turn to supermarkets and other retail outlets to get their alcohol. CAMRA said it has therefore called for a potential reduction in taxes at pubs and a minimum price per unit of alcohol to prevent drinks being sold at a loss.
Rodolphe de Looz-Corswarem, secretary general for the Brewers of Europe, told BeverageDaily.com that while the industry had to ensure it was promoting moderate and responsible consumption of alcohol, the price cuts were likely to offer some relief.
Pointing to current concern over the declines within Britain’s pub trade, de Looz-Corswarem said that to ensure healthy competition within brewing, the industry should be free to sell at the best price possible to protect jobs and profits.
Brewer concern
While brewer Greene King, which supplies one of the beers that will be offered for 99 pence, said it has had no say on Whetherspoon’s price policy and would not be paying for the cuts itself, the group did stress some ‘concern’ over the price developments.
A spokesperson for the group said that the decision to offer its IPA brand at 99 pence a pint was out of its hands and not supported by the group, as brewers themselves were legally prevented from interfering with on-trade and retail pricing.
The brewer added that the JD Wetherspoon chain has been a staunch supporter of cask ales in recent years, though it was unsure over the group’s latest price drive.
“We are concerned by how low the price is, but since it is not our decision, will not be commenting any further on this promotion,” stated the company spokesperson.