Drinks sales 1% below 2019 but inflation makes real growth 'very hard'

By Rebecca Weller contact

- Last updated on GMT

Drinks sales 1% behind 2019: inflation makes seeing real growth very hard according to CGA (Credit: Getty/The Good Brigade)
Drinks sales 1% behind 2019: inflation makes seeing real growth very hard according to CGA (Credit: Getty/The Good Brigade)

Related tags: Cga, Finance, Coronavirus, Spirits, Cider

Average drinks sales in managed pubs, bars, and restaurants were 1% down in the seven days to Saturday 18 June compared with the same period in 2019, according to the latest Drinks Recovery Tracker from CGA by NielsenIQ.

Despite being fractionally behind pre-covid levels for the second time in a row, year-on-year inflation, which has soared to a 40-year high of 9%, meant sales were significantly behind in real terms.

CGA ​managing director UK and Ireland Jonathan Jones said: “High inflation is making it very hard for on premise drinks businesses to achieve real terms growth at the moment.

Increasing pressure 

“It’s going to be a while before we see the full impacts of the cost-of-living crisis on consumers, but spending is likely to come under increasing pressure as we move into the second half of 2022.”

It was a week of two halves for the on trade, with a strong midweek followed by a disappointing Saturday.

Warm weather helped drive drinks sales into double-digit growth on Tuesday (24%), Wednesday (11%) and Thursday (10%), but trading was just 2% ahead on Friday and fell away by 11% on Saturday, in part due to cooler temperatures.

The figures showed the close correlation between weather and sales, especially in the summer, as well as a shift in trading dayparts​, including a rise in midweek drinks as consumers opt to work from home towards the end of the week.

Keys to success 

Cider ​proved to be the best performing drinks category for the second week in a row, with sales 12% ahead of the same week in 2019, while spirits and beer were up 5% and 1% respectively.

However, the soft drinks category saw a decline of 6% while wine sales decreased by 18%.

Jones added: “Consumers are telling us they want to spend more in the sector and will prioritise eating and drinking out over other discretionary spend.

“Understanding these new priorities and the changes in consumer habits since Covid are going to be two of the keys to success in a very competitive and challenging market.”

 

Related topics: Cider

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