Tied drink prices set to rise by 4%
Price hikes at the bar look to be inevitable as beer costs increase
Tenants of major pubcos are seeing tied drinks prices increase by about 4% this month.
This follows recent above-inflation price hikes from major brewers. All eyes are now on the Budget on 12 March as licensees consider increases at the bar.
A statement from Punch said it is using its "scale and buying power to absorb some of the cost increases ourselves".
"This will ensure that beer price rises increase by no more than 4% - below the headline RPI inflation rate of 4.3%." Punch's increases took effect on 11 February.
Enterprise licensees have also been told to expect increases of 4% on average from 18 February.
Enterprise host Jerry Hudson of the Farmhouse in Horley, Surrey, expects to add more than 10p on a pint.
"If we put 10p on a pint as we have done previously, that only covers the wholesale increase and VAT. It doesn't take into account other costs like the minimum wage and utilities."
Marston's Pub Company tenant Tim Barlow said increases have varied from about 2.7% to 4%.
For example: 36 gallons of Pedigree rise from £359 to
£373 (up 3.9%); 22 gallons of Carling, £219 to £225 (2.7%); and 22 gallons of Kronen-bourg, £246 to £256 (4%).
Barlow, of the Hawk & Buckle in Etwall, Derbyshire, said: "I suppose this is to be expected. I might wait for the Budget and put my prices up then." Marston's new prices took effect on 7 February.
A list of price changes from 28 January for Admiral Taverns licensees, seen by the Morning Advertiser, indicates 50 litres of Budweiser would increase by £6 (4.5%) to £131.95. The same quantity of Strongbow would rise by £5.24 (5%) to £109.19 and Guinness by £3.54 (3%) to £121.63.
Prices for tied Greene King Pub Partners licensees increased by 3% to 5% from 11 February, a company spokeswoman said.
A spokeswoman for Scot-
tish & Newcastle Pub Enter-prises said price rises for the tied leased estate will be pas-sed on directly when wholesale increases take effect.
Guild of Master Victuallers chairman Godfrey Page said the relatively moderate price rises were "a step in the right direction as pubcos don't appear to have added huge increases themselves".
But he urged pubcos to consider rent reductions for struggling licensees.
Page said: "If pubcos are taking part of the [wholesale] increase themselves that has to be good news.
"Whether it's enough to help out licensees who are in trouble, that's difficult to tell.
"If turnover is going down as a result of things like the smoking ban, I feel pubcos should be looking at the rent and making a reduction."
Federation of Licensed Victuallers Associations chief executive Tony Payne said licensees should not be frightened to add realistic increases at the bar.
He said they must take into account factors other than wholesale or pubco price hikes, such as rising wages and utility costs.
"Some people try to absorb these costs and they go bankrupt," warned Payne.
l Welsh alcohol tax - p2
