Pring: Beer price rises loom for pubs

Lager on sale in Asda for 22p a can - that was the story The Mail on Sunday went big on at the weekend.

Yet "beer prices in pubs to rise"​ is the story we've gone big on today. What a world we're operating in.

The pricing gap between the pubs and the off-trade just seems to get wider and wider, and we're not even into the supermarkets' pile 'em high Christmas deals yet.

Big increases​

Let's be very clear - licensees should be under no illusions that brewers will be posting big increases in the new year.

The costs of brewing production and distribution have soared, much of the increase caused by materials shortages because of soaring beer sales in countries like Russia and China.

Tough times require big steps. Is anyone out there in pubco land big enough to take them?​Andrew PringMA Editor

By talking to MA in the way they have this week, S&N is preparing the ground for January's price rises. And they won't be alone - every brewer at national and regional level will be looking to do the same.

What's even more worrying, though, is that the rises may not just be straightforward cost-of-a-barrel increases. Delivery charges are firmly on the agenda, with Carlsberg being the first but almost certainly not the last to move.

Struggling licensees​

So where does that leave the struggling licensee?

Struggling even more is the obvious answer, as he or she tries to pass on the increases to the dwindling crowd of customers who have braved the winter and have a little bit of spare cash left.

Because what option is there, other than to charge more if you're being charged more yourself? It's what the brewers are doing.

Trouble is, it's going to make you very unpopular with your customers, and contrast your prices even more starkly with offies.

Caught between a rock and a hard place like this, licensees must hope that their pubcos take note of what Marston's beer boss Alistair Darby told the MA last week.

Tough times​

In a very brave move, Darby questioned whether everyone is doing enough to justify their share of the gross profit of a pint. Licensees probably feel they do, and no doubt brewers feel they do too.

So where does that leave the pubcos? Can they all look their licensees in the face and say they've worked to make the 32% of GP on every pint their licensee has sold?

In another interesting development last week, Punch announced more help for its new licensees. That's great, but the help that many licensees would prefer is to pay less for their beer and their rent.

Tough times require big steps. Is anyone out there in pubco land big enough to take them?