Is draught beer in supermarkets another threat to the on-trade?

By James Beeson

- Last updated on GMT

Long-standing relationship: Saltaire Blonde ale is available on cask at one Morrisons branch
Long-standing relationship: Saltaire Blonde ale is available on cask at one Morrisons branch

Related tags Draught beer Alcoholic beverage Morrisons

Christmas shopping is often thirsty work and, for some, a crisp pint at the end of it is the only thing that makes the prospect bearable.

Supermarket chain Morrisons believes it has come up with the perfect solution to this conundrum by installing a bar in its Guiseley, West Yorkshire, site. The bar will serve a range of local ales, an Frizzante Italian wine, as well as cider, lagers and craft beers. This follows Waitrose installing a wine bar in its shop in King's Cross in 2015.

However, with supermarket beer sales overtaking pubs for first time last year, and sales of beer in pubs down 35m​ between July and September of this year, could the appearance of bars in supermarkets be yet another blow to the already beleaguered on-trade?

"While this is good news for drinkers, and also opens up an additional market for brewers selling draught beer, it isn't good news for pubs,” freelance writer and beer sommelier Sophie Atherton told The Morning Advertiser ​(MA​). ”It's further proof that pubs absolutely must raise their game when it comes to beer.

“Quality must be beyond reproach, staff need to be highly trained and beer lists need to be more adventurous,” Atherton continued. “If supermarkets are pitching for on-trade business, pubs need to consider that boring brown bitter on three pumps, a couple of bland big brand lagers and staff who know little about beer might not be the best way to compete."

Tax inequality must be addressed

JD Wetherspoon chairman Tim Martin, who has previously accused the UK tax system of favouring supermarkets at expense of pubs,​ added that the move further highlighted the tax between the two types of venue.

“I don’t think this is a big change as there are already pubs and restaurants in and around retail parks and other areas where supermarkets trade,” he said. “It’s a bit more competition and emphasises the need for supermarkets and pubs to be taxed equally.

“They pay no VAT on food whereas we pay 20%. They pay 2p per pint in business rates and we pay about 18p.”

In response to these concerns, Association of Licensed Multiple Retailers (ALMR) chief executive Kate Nicholls stressed that if supermarkets wanted to enter the on-trade, they must be treated in the same way as pubs.

“Pubs, bars and restaurants already face significant barriers to growth in the shape of prohibitive costs and restrictive licensing arrangements,” she said. “If supermarkets are now going to be permitted to sell alcohol for consumption on the premises, these businesses must be subject to exactly the same conditions that any other on-trade venue would face. Overall, there must be consistency.”

'No substitute' for the pub

However, not everyone in the industry fears the supermarket threat. British Beer & Pub Association (BBPA) chief executive Brigid Simmonds told MA​ supermarkets lacked the expertise that pub operators bring in the service of draught beer and food.

“It’s an interesting attempt to promote draught local beers but I doubt this represents a threat to the great British pub,” she said. “When it comes to enjoying a great beer, supermarkets aren’t going be able to match the welcoming atmosphere that is the speciality of the pub.

“There’s a lot to consider in serving a great draught beer, to ensure it is in great condition, perfectly poured and with the right glassware, and great food to go with it. You can’t beat the pub experience, and our huge variety and choice of beer and food.”

CAMRA's head of communications Tom Stainer echoed these thoughts. “While it’s encouraging that more outlets are experimenting with serving draught beer, which could help introduce more people to different styles and flavours - especially if locally sourced - there is no substitute for a good community pub," he said. "Pubs provide a pivotal role in our society, acting as a hub for people to come together to enjoy a drink in a responsible and supervised setting.

"This simply cannot be replicated in other venues, such as a supermarket where the primary focus is to go shopping rather than to socialise with friends."

Breweries bite back 

Supermarkets have been aggressively expanding their beer offering​ in bottles and cans in recent years. Earlier this year, Waitrose added 25 new craft beers to bring its total offering to 90, while sales of speciality beers are up 33% in the past year.

Saltaire Brewery, whose beer is served on draught in the Yorkshire Morrisons, defended the decision to supply the supermarket chain.

Saltaire managing director Ewen Gordon said: “We have a great, long-standing relationship with Morrisons, so when they approached us with the concept of enriching the supermarket experience, we were more than happy to support them.

“The idea is designed as an extra option for the supermarket shopper to enjoy while in-store, and not as an alternative destination to pubs. We believe there is room for success for both parties because they provide two very different offerings.”

Last week, Northern Monk director Russell Bisset also defended his brewery’s decision to put its beers into supermarkets,​ stating his belief that extra exposure to craft beer would benefit the pub trade in the long run.

“The more exposure those beers get, the better in the long term for the pub trade,” he said. “I certainly wouldn't cite that as one of the reasons that there is a decline in the number of pints consumed in pubs.”

Related topics Beer

Related news

Show more