Industry urges new Government to take action on supermarkets

By Emily Sutherland contact

- Last updated on GMT

Supermarkets, Wetherspoons, ALMR

Related tags: New government, Alcoholic beverage

Leading voices within the pub industry have called on the new government to take action on supermarkets selling cut-price alcohol.

Kate Nicholls, chief executive of the Association of Multiple Licensed Retailers said: “Crucially we would like to see the new government create a levelling of the playing field in terms of VAT, business rates and alcohol prices to ensure that the licensed hospitality business remain competitive  at the same time as tackling pocket money prices in the off-trade.

“What is needed is stability and certainty to allow pubs to improve their offerings. It is worth remembering however, that more than 70% of alcohol consumed in the UK is consumed away from the safe, supervised environment of a pub or bar.”

JD Wetherspoon’s chairman Tim Martin also urged the incoming Conservative Government to create “equal rates payable per pint in pubs and supermarkets.” The pub giant accused supermarkets of impacting trading performance earlier this month, naming the late night levy, higher business rates per pint and a ‘huge VAT disparity’ as  major disadvantages for pubs. Martin has been a vocal critic of supermarket booze offers throughout his tenure as chairman of the company, which now has over 900 pubs.

Tim Page, chief executive of CAMRA added: “Well-run pubs are part of the solution, not the cause of any problem the UK has with alcohol. They present a controlled atmosphere rather than drinking for drinking’s sake. The same cannot be said for alcohol purchased cheaply from supermarkets. We call on the Government to recognise this distinction and to support pubs.”

However, Chris Wright from the Pubs Advisory Service urged publicans to think more carefully about their drink offer. Wright said: “My take is that publicans who only sell branded products that you can find in the supermarket are playing a losing game.

“Visiting a pub is about finding exciting products, not about buying something you can get on a three for £5 offer from a supermarket.”

Morrisons revealed it is set to close 23 stores following losses earlier this year, and Sainsbury’s reporting its first annual loss in a decade.

Falling supermarket profit figures could spell good news for licensees, with consumers more likely to eat or drink out rather than take advantage of supermarket’s ‘dine in for £10’ deals.  A recent PMA ​survey found readers are seeing an increase in consumer spending, with more than half experiencing a rise in turnover in the last year. 

Related topics: Legislation

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Posted by ruth horner,

Great article Ms. Sutherland. Chris Wright is spot on. As publicans we are playing a losing game if we try and compete directly with the major supermarket chains. If we offer unusual products (ales, hard-to-find lagers) and a distinct environment, we may well survive. Fight the good fight, comrades!

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Posted by Graham Bell,

I maintain VAT is not properly collected on retail sales when sold at a loss by a supermarket. The VAT rate may be the same but the actual money collected is most definitely not. Avoidance yes - legal yes - right? - not in my opinion. This is the most unfair advantage to the on-trade whose supplies remain standard rated, whilst supermarkets can benefit from sales of essential zero rated supplies, in addition to volume discount benefits.

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Posted by ken nason,

Still don't see where it changes the imbalance between on and off sales. The duty is the same and the vat is the same on the sale price. The discounts will still be there regardless of tax on on brewers.

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