Yesterday (Thursday 6 March), Diageo announced a 4.2% price hike on Guinness Draught for on-trade customers, as first reported by The Morning Advertiser (The MA).
Applicable to Guinness Draught products including keg, microdraught and Guinness Surger, the increase will be effective from Thursday 1 May 2025.
A Diageo spokesperson said: “Guinness is a high-quality beer that is a significant footfall generator for hospitality and this CPI ensures we can sustain investment levels in, and continue to grow, the Guinness brand.”
Guinness 0.0 and Guinness Draught in can format will not be impacted, Diageo confirmed.
Owner of the Gardeners Arms/Murderers in Norwich, Philip Cutter, told The MA: “It looks, on the face of it, that off-sales are not likely to be affected by this price hike, which means the the on-trade once again takes the burden of yet another price increase.
Suitable alternative
“The arrogance of the brand, which suggests that in itself is a ‘footfall generator’, is appalling.
“It’s my genuine opinion that most landlords would swap out Guinness if there was a suitable alternative – not just because of the price difference, but because of the arrogance that Diageo continues to display, since they corner the draught market.”
Alongside the price increase, Diageo also committed to providing 1m Guinness glasses to support on-trade customers over the next 12 months, 500,000 of which are set to be supplied over the next three months.
However, Cutter claimed his pub had received “little or no support” from the brand in terms of glassware for more than a year.
“Even then, we only received a dozen glasses. Then, we are expected to be grateful when we receive a dozen St Patrick’s Day hats and bunting, a couple of days before St Patrick’s Day itself”, he added.
The Norwich-based operator added communication from Diageo over the festive period, when the sector was hit by mass shortages of the stout, caused by a spike in demand, was “appalling”.
Cutter said: “Suggesting they are in constant contact with publicans is farcical. We found out about stock shortages from a Molson Coors rep - only after stock levels were shown as ‘unavailable’, and I contacted them.
“Three months on and we are still restricted to how many kegs we can buy per week, and now are being asked to pay 4% extra!”
“When you have a product that simply has no serious rivals you can do what you want price wise. Not many beers have this luxury.”
Cheshire Cat Pubs & Bars owner Tim Bird
Diageo assured while demand for Guinness has continued to grow, supply issues have been tackled.
At Cheshire Cat Pubs & Bars, Guinness Draught sales have soared 42% year-on-year and owner Tim Bird noted demand across its seven-strong estate was growing for Guinness 0.0% too.
The growing demand, Bird said, demonstrated the need for Diageo to up its Guinness prices: “I would think Diageo needs to invest this price increase into building more production capacity, especially if Draught 0% is to be fully launched in the UK this year.
“They didn’t cope this Christmas with production in the UK so to cope going forward they will need to invest the extra money in ensuring their ‘cash cow’ doesn’t get hindered by inadequate production levels and volume forecasting, otherwise people will turn their backs on the brand.
“When you have a product that simply has no serious rivals you can do what you want price wise. Not many beers have this luxury.”
In addition, the Cheshire-based operator told The MA he felt Heineken had missed an opportunity to rival Guinness with its Murphy’s brand.
Bird said: “I do hope Heineken are having ‘sleepless nights’ over all this. They are sitting on the second biggest stout in Ireland and yet have done nothing with it for years.
“Apparently, it is in only 500 pubs nationwide and yet Murphy’s had Guinness on the run back in the day! A missed opportunity for sure and splitting the M is somewhat more difficult.”
Upward pressure
Meanwhile, The Campaign for Real Ale (CAMRA) told The MA the news highlighted the “grim choice” faced by publicans of having to put prices up for customers or absorbing more costs themselves and putting businesses at risk.
Chairman Ash Corbett-Collins said: “Pubs, bars and taprooms are doing all they can as a means to survive as they battle against a tidal wave of issues such as high energy bills, national insurance increases and rising costs of goods.
“Following the well-publicised Guinness shortage over Christmas, it is sad but predictable that costs for pubs are being increased.”
Similarly, JKS Pubs managing director Dom Jacobs told The MA most businesses were expecting such price hikes and had already planned to increase their prices ahead of April tax rises.
He said: “The triple whammy of extra costs placed on hospitality by the chancellor hit us. Supplier price increases will put further upward pressure here but guests are expecting this as it has been well publicised. We will limit this as much as we can but there will be no getting around it.
“I don’t think this will put people off buying Guinness or indeed any other beers. The shortage in parts of the UK before Christmas showed that many people were willing to spend more as supply and demand caused plenty of price spikes around the country at points.”
