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Plummeting supermarket beer prices increase pressure on pubs

By Ben Winstanley , 07-Jan-2016
Last updated on 08-Jan-2016 at 13:58 GMT2016-01-08T13:58:28Z

Top 6 PBA lines (Nielsen Scantrack MAT to June 2015)
Top 6 PBA lines (Nielsen Scantrack MAT to June 2015)

Pubs struggling to compete with supermarket margins have received a fresh blow as the price of premium bottled ale continues to plummet in the off-trade, according to the December issue of Butcombe Brewery's Premium Bottled Ale Report.

As big chains pushed to commoditise the sector over the Christmas period, the standard price of premium bottled ale on supermarket shelves was at an all time low, increasing the pressure on pubs to find a point of difference from their retail rivals going forward.

The report also found that supermarkets used more promotions than ever before with 85% of the top six premium bottled ales (Nielsen Scantrack MAT to June 2015) on promotion across the stores, an increase of 12% on the last quarter of 2014.

Multibuy discounts, such as three for £5 and four for £6, formed the majority of supermarkets sales offers over Christmas, with one interesting report finding being the lack of Christmas seasonal ales stocked by the big chains – only Morrisons (Marston’s Christmas selection pack) and Tesco (Thwaites' Yule Love It, Black Sheep's Blitzen and Hardy & Hansons' Rocking Rudolph) offered any festive ale, despite the many options available.

With supermarkets seemingly happy to continue cutting prices and increasing the number of lead-loss offers, the news will make for dim viewing for licensees.

As perceptions towards beer change, one would hope there is light at the end of the tunnel with only so much further that supermarkets can drop prices before they must change tack – some small consolation to the on-trade.

A brief overview of what is happening in the multiple retail sector, the monthly report monitors the pricing of a basket of the top six PBA lines at Asda, Tesco, Sainsbury’s, Morrisons, Waitrose and Co-op stores.

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