Brewers defend wholesale price increases

By Ellie Bothwell

- Last updated on GMT

Publicans face having to up the retail price of a pint in order to maintain their margins (Credit: Flickr - quinndombrows)
Publicans face having to up the retail price of a pint in order to maintain their margins (Credit: Flickr - quinndombrows)

Related tags: Marketing, Cost, Inflation

Brewers have defended their position in regards to wholesale price increases and claimed they strive to “keep costs competitive”, after licensees slammed the move that will see rises of up to 5p per pint in some instances.

The price increases from three major brewers mean publicans will have to up the retail price of a pint in order to maintain their margins.

'No justification'

Commenting on the original story, Mike Rowlands, director of Guardian Leisure, said: “There is absolutely no justification for wholesale prices to increase at this moment by about 12p retail apart from it being customary for the brewers to raise prices each year at this time. Most of their operating and ingredient costs have reduced in the past year”.

Licensees commenting on the PMA​ website also criticised the move, particularly in light of the current low inflation rate and recent fuel price drops.

One said: “With the fall in oil prices and a strong pound both deliveries to pubs and supplies to the brewers should be cheaper, so why is this not being passed on to the licensees?”

Another commented: “With all the principle core products for brewing cheaper than last year, and fuel prices in freefall how can they even try to justify any price rise?”

'Rising costs'

However, a spokeswoman for Carlsberg UK, which put up prices on beers, lagers and ciders by between 2.9% and 3.6% on 5 January, claimed that there are “rising costs associated with running our business” and it “strives to keep our costs competitive”.

She added: “We’re continue to invest in innovation across our beer and cider brands and wider beverage portfolio, and we are confident that our customers will benefit from our significant investment in marketing and advertising throughout 2015 which will support our brands.

“We also provide a dedicated resource within our sales and business support teams, each helping our customers to maximise opportunities for driving consumers into their outlet.”

Molson Coors, which has increased the cost of all draught products by approximately 5p per pint due to “rising input prices”, said it has “worked hard… to keep the level of increase to a minimum” but failed to provide any further clarity.

Heineken UK failed to respond to the PMA’s request to comment.

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