In the wake of Osborne’s beer tax axe, pub owners have been raising a glass in celebration. However, while our hoppy treats will have a lighter burden on our wallets, people are seeming to forget what’s going on with other types of alcohol.
In recent research by respected market research company, Mintel, it was found that three in five adults drink cider, up by nearly half from a year ago. The company predict the cider market to grow by £1bn over the next five years, as it starts to narrow the gap with beer. In the past five year, cider sales have grown by 32%, with sales surging by 5% in 2012 alone. While we all love our beer, cider’s going from an occasional alternative to the norm.
A landlord who’s ran a successful East London pub for the past 10 years, who preferred to remain unnamed, said cider sales have been booming.
“Cider’s became about as popular as our beers since I took over the place. People are looking for a lighter pint it seems. The shift may be down to the gentrification of the area, with all sorts of different people coming in since the Olympics,” he said.
“It’s great the duty escalator was scrapped, will make our lives easier. But, our customers’ palates are becoming more and more demanding and I think more needs to be done for the other alcohols we have on offer.”
With the duty escalator gone, beer tax will now be in line with inflation. Yet, cider duty has still increased 2 per cent above inflation, and we’d imagine it will continue to do so next year. So, while less beer tax will land in the government’s coffers, tax from increasingly popular cider will, helping fill the monetary gulf from the beer tax loss and source new problems for the pub industry.
Chris Wisson, senior drinks analyst at Mintel, described cider as “one of the star performers amongst alcoholic drinks markets”
“While many drinks markets are struggling to grow in real terms and also hampered by the government’s tax escalators, cider is one of the anomalous success stories which is also showing underlying volume growth,” he added.
The unexpected growth of the cider market has given the 55-year-old landlord something to worry about.
He said: “While it’s great people are adding variety to their drinking habits, the scrapping of the beer duty escalator will give with one hand and take with the other, as the popularity of cider will just give us another financial worry that George Osbourne doesn’t seem to realise.”
Taking this into account, it’s possible to argue that Osborne was just satisfying popular opinion and not really changing much for ailing pubs. Do let us know what you think and drop in a comment below.