UK On-Trade Report 2006

SPARE A THOUGHT for the poor UK on-trade. Tossed on the waves of current affairs, like a ship on stormy seas, it easily falls prey to consumer worries – not to mention the latest fads and fashions.
Terrorist threats, binge-drinking, antisocial behaviour and underage drinking have all been hitting the headlines with inceasing frequency so far this year. The resulting fall-out for licensees is more than enough to contend with, let alone worrying about new legislation on extended opening hours and smoking.
Throw in the fact that you need to keep up to date with the latest products and trends to make sure your customers are excited and delighted every time they visit – pomegranate-flavoured, extra-cold, ultra-super-premium, imported, rosé lager anyone? – and quite frankly it’s amazing that the nation’s on-traders haven’t collectively packed their bags and headed off to a yoga retreat on some exotic island.
But that’s the point isn’t it? As we noted in our first On-trade Report of 2006, published in the first half of this year, the UK on-trade is a pretty relentless beast, with the gritty survival instincts of an expertly trained SAS commando. Licensees are used to battening down the hatches and weathering the storms that come along.
The financial reality isn’t always pretty; some venues do sink, not swim. But more often than not there’s a glimmer of hope for the rest – a summer heatwave or a big office christmas party booking – to put wind back in the sails, not to mention the sales.

What’s clear is that the on-trade is very good at rolling with the punches – and that’s the attitude that will jump out at you from the pages of this report. For example, licensees are now tackling the problems of the ASBO generation by utilising cutting-edge technology to monitor who’s coming through their doors. Speciality spirits and liqueur brands are reinventing themselves and the cask ale sector is mounting a challenge to the big boys of the beer category with innovation and some savvy marketing.
In the soft drinks category, operators and brand owners are finding new ways to quench consumer thirst for bottled water. While mass-market venues are plugging into the fact that Champagne is increasingly becoming an affordable luxury for many of their customers.
As our lead feature emphasises, the on-trade is evolving venue by venue and is now a totally different proposition to what it was five or ten years ago. And there are still more opportunities out there: Constellation’s latest research shows that pubs and bars across the board need to wake up to the huge potential for increasing wine sales.
So maybe we don’t need to feel too sorry for the on-trade after all. Although nothing in life is plain sailing, if licensees and brand owners can keep reacting to events and rising to every new challenge – which I believe they can – the industry will continue to
stay safely afloat.

Julie Sheppard
report editor