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‘Impossible’ to compete with low supermarket cider prices

By Emily Hawkins contact

- Last updated on GMT

Budget plea: pubs have said it is impossible to compete with supermarket cider prices unless the Government eases unfair costs
Budget plea: pubs have said it is impossible to compete with supermarket cider prices unless the Government eases unfair costs

Related tags: Cider

Cider pubs have said it is impossible to compete with supermarket prices unless the government eases unfair costs.

Supermarket prices for cider average 91p per pint, and £5.16 per pack for all packs with 440ml servings, according to annual figures from Kantar Worldpanel data.

This is compared with pubs, where a standard pint of cider is sold at £3.45 and a premium pint at £4.45, CGA data shows.

Matt Slocombe, operator of the Crown Inn, in Woolhope, Herefordshire, said price comparison was an “age old problem”.

He said: “Heavy discounts and enormous purchasing power for the supermarkets make the mainstream offering impossible to compete with.

Slocombe said pub prices included “the unique environment that only the Great British pub can produce” and his pub had stayed competitive by producing its own cider.

Reduced taxes

Taxes on the trade should be reduced and not frozen, he added and said: “There must be a new approach that eventually removes business rates completely - country pubs and the high street depend on it.”

Peter Holt, from the Southampton Arms Ale and Cider House, in London, said: “Drinking mass-produced fizzy supermarket cider sitting on the sofa at home is fine if you’re either skint, feeling antisocial, have an undeveloped palate or like supporting huge corporations and contributing to the demise of the British pub.”

He added: “We talk to our customers and advise them and let them taste samples. Then they get to drink it in a nice cosy warm pub, by the fire if they’re lucky.”

UKHospitality said pubs and bars were not able to absorb or pass on the costs of alcohol duty with the same ease as supermarkets.

Pubs are “battling against” a multitude of costs including business rates, VAT and wages in a labour-intensive sector, the trade body said.

Battle for pubs

A spokesperson explained: “Alcohol duty is paid by the manufacturer and is the same regardless of whether the product is intended to be sold in the on or off-trade.

“It is this cocktail of costs that put pubs, and other on-trade businesses, at a disadvantage compared to supermarkets and why large off-trade venues are able to sell alcohol at such dramatically low prices.”

UKHospitality is concerned with reducing business costs and is campaigning for an overhaul of the business rates system, which it believes penalises pubs compared to supermarkets.

Gabe Cook from the website The Ciderologist agreed: "Although a reduction in cider duty would always be welcome, especially after so many increases in recent years, changes in duty alone won't help pubs be more competitive with retailers.

"Issues such as the tie and increasing rates and rents all serve to drive up the price of a pint."

Support for small producers

The National Association of Cider Makers said it was unable to discuss pricing at its meetings and could not comment on the issue.

However, the NACM has asked the Treasury to introduce a duty that would support small cider makers. The request comes as the Chancellor is set to announce a new rate for products between 6.9% and 7.5% ABV on 29 October.

The trade group said an increase in excise duty would be detrimental to the majority of producers, with smaller businesses most affected.

A new duty band for mid-strength cider will come into effect from 1 February 2019 and the NACM said a 2p per pint reduction in excise duty for standard cider is needed for growth.

Gordon Johncox, chair of the NACM, said: “Most cider makers will make ciders in both the standard and the mid-strength duty band, so this reduction would help soften the blow when the new duty rate comes in next February.”  

Johncox added: “Cider really is a Great British success story and we ask that it is given more support to encourage growth, innovation and success.

“We hope that we will be raising a glass of cider to the Chancellor next Monday.”

Related topics: Cider

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