Report highlights growing importance of wine and spirits to on-trade drinks sales

By Carina Perkins contact

- Last updated on GMT

Related tags: Alcoholic beverage

Wine and spirits are stealing market share from beer in pubs, restaurants and bars
Wine and spirits are stealing market share from beer in pubs, restaurants and bars
Sales of wine and spirits are on the rise in pubs, bars and restaurants, according to the latest research by CGA Strategy.

The research, which was commissioned by the Wine and Spirit Trade Association (WSTA), revealed that on-trade wine and spirits revenues increased by £280m between 2013 -2014, with wine sales now accounting for 18 per cent of the total, and spirits accounting for 22 per cent.

Wine is particularly important to newly opened pubs, bars and restaurants, accounting for 22 per cent of their total drinks sales. Spirits account for 18 per cent of sales in new venues, while beer and larger accounts for 40.2 per cent.

In contrast, wine accounts for just 12.3 per cent of sales in pubs that are on the brink of closing, compared to 58.5 per cent for beer and cider sales.

Future growth

With an increasing emphasis on food in pubs across the UK, wine and spirit sales are set to increase even further over coming years.

CGA predicted that by 2018, wine will account for 20 per cent of total on-trade drinks sales, while spirits will account for 24 per cent of the total.

In contrast, contrast beer and larger sales are set to decrease from around 50 per cent to 47 per cent over the next four years.

Wine and Spirit Trade Association (WSTA) chief executive Miles Beale said the CGA data demonstrated that “pubs, bars and restaurants are increasingly reliant on wine and spirit sales to bring in revenue”.

He called on the Chancellor to scrap the proposed 2 per cent increase in alcohol duty in the upcoming Budget, pointing out that same increase last year cost pubs, bar and restaurants an additional £34m in taxes.

“This will also be welcomed by responsible drinkers in hard-pressed times,” he said, pointing out that tax now accounts for a staggering 79% of an average priced bottle of spirits and 57% of an average priced bottle of wine in the UK.

Call Time on Duty

The WSTA is part of the Call Time on Duty Campaign​, which is calling on the government to abandon the Alcohol Duty Escalator, which automatically increases duty on wine and spirits by inflation plus 2 per cent every year and has been blamed for declining alcohol sales​ in hospitality businesses.

A poll of 2,000 UK consumers published by the campaign yesterday revealed that the majority (97 per cent) of Brits believe alcohol is already too expensive, and are likely to socialise at home rather than in bars and restaurants if prices increase further.

Jonathan Isaby, chief executive of the TaxPayers' Alliance said: “The British public love to socialise. They love pubs and restaurants - catching up with friends and family and meeting new people. But they are being gradually priced out of this pleasure by ridiculous levels of tax on their drinks. That means both people and local small businesses are suffering.

“The Government could address this in the Budget by scrapping the Alcohol Duty Escalator once and for all and freezing duties. If not, further increases will have a devastating impact on pubs, clubs, restaurants and communities across the UK.”

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