Weathering the storm

8th August, 2012 by db_staff - This article is over multiple pages: 1 2

This summer’s washout has affected the drinks industry both practically and metaphorically, but there are occasional bright patches, according to Spiros Malandrakis, senior alcoholic drinks analyst at Euromonitor International.

An array of images could fittingly summarise the state of the UK alcoholic drinks market in 2012. Rain-soaked plastic bunting reflected in the muddy water of a widening pothole would be one. The vision of an overcrowded train carriage swiftly passing by a fading Olympics poster could also do the job.

Perhaps Andy Murray’s tearful portrait following his defeat in the Wimbledon final would suffice. But beyond sensationalist metaphors, this year’s Jubilee-induced optimism and feverish Olympic aspirations are failing to turn the tide for the troubled domestic alcoholic drinks industry.

HERE COMES THE RAIN

Macroeconomic indicators make the weather appear positively Mediterranean in comparison. The UK economy officially slipped back into recession in April 2012 and it is expected to mostly flatline for the year. Unemployment is at a near 20-year peak, with youth joblessness the highest since records began in 1992. Household final consumption expenditure fell by 1.7% in real terms in 2011 and is expected to decline by a further 1.5% in 2012.

Business investment has weakened appreciably, house prices continue to slide and consumer confidence has plummeted. And this is just with regard to top line socio-economic undercurrents.

The neo-prohibitionist rhetoric that has been creeping into the public sphere over the last couple of years appears to be gaining traction. The government’s punitive tax escalator regime continues to squeeze the drinks industry’s margins hard as its laissez-faire promises give way to a more interventionist approach.

Scotland is ignoring the EU competition authorities’ protestations to proceed with the legal measures that will pave the way for minimum pricing. From a lowering of the drink-driving limit to the abolition of multipack deals, government agencies and health advocacy organisations seem to be mounting a full-frontal attack. If only the industry did not also have to face its own shortcomings and inherent maturity issues.

According to Euromonitor International, total alcoholic drinks volumes are set to drop by 1% in 2012, an improvement on 2011’s dismal 3% decline, but definitely not a figure prompting many in the trade to break out the Champagne.

And while Champagne sales themselves are set for a relative rebound with less than 2% total volume growth tipped for 2012, a cheery attitude is in short supply.

Overall, beer is set to suffer over a 2% total volume drop, still light grape wine will see further acceleration of its chronic decline, the brandy and Cognac category is expected to remain trapped in its downward spiral, while spirits can at best hope for an anaemic 1% total volume gain for the year.

Leave a Reply

Your email address will not be published. Required fields are marked *

Subscribe to our newsletters

Job vacancies

Sales Order Processor

Amathus Drinks
Park Royal, London NW10, UK

Sales Executive (London – Craft Spirits)

Bimber Distillery
London, UK

Events & PR Co-ordinator

Alliance Wine
London, UK

Partner Development Manager - That Boutique-y Gin Company

That Boutique-y Gin Company
Field Based, UK

Head of Merchant Sales

Grapevine the Wineservice Company
Cumbria, UK

Director of Sales

Matthew Clark
Field based - Hampshire, Dorset, Surrey, Berkshire or West Sussex, UK

Business Development Manager – Central London

Marussia Beverages UK Ltd
Field based – London, UK

Account Manager – Premium Restaurants, London

Kingfisher Beer Europe Ltd
London (Central), UK

Field Sales Representative - Beer Innovation

Elastic
Various locations, UK

Events Executive

The Drinks Business
London, UK

Area Sales Executive

Gordon & Macphail
Southern England (excluding London) and Inner London, UK

Buyer – Wine & Spirits

Sipp
London, UK

Spirits Advisor

The Whisky Exchange
London, UK

Marketing Implementation Manager

Matthew Clark
London / Field, UK

The Global Malbec Masters 2017

Deadline : 1st August 2017

The Global Beer Masters 2017

Deadline : 1st August 2017

Global Chardonnay Masters 2017

Deadline : 1st August 2017

The Global Riesling Masters 2017

Deadline : 1st August 2017

Click to view more

The Global Organic Masters 2017

The drinks business is thrilled to announce the launch of The Global Organic Masters

The Drinks Business Awards 2017

Now in its 15th year, the db awards have become the most authoritative, internationally respected badge of achievement in the alcoholic drinks industry.

The Asian Cabernet Sauvignon Masters 2017

the drinks business Hong Kong announces its first year of The Asian Cabernet Sauvignon Masters.

Rioja Masters 2016

Now in its fifth year, the competition will recognise and reward the finest Riojas on the world stage.

Click to view more