Challenging times for wine and spirit markets

The latest WSTA market report shows across the board falls in wines and spirits sales volumes, as consumers continue to tighten their belts.

Sparkling wine in the off trade and sales of cider in bars and restaurants were two of the product categories to buck this trend. Against a backdrop of declining total alcohol sales, down 2% in the off trade and 3% in the on trade, sales of sparkling wine in the off trade and on trade sales of cider are up 5% over the past 12 months.

The report draws on data from leading independent sources including Nielsen, CGA Strategy and Wilson Drinks Report.

The data reveals that:

• In the last year off trade sales of wine declined by 2% in volume and spirits declined by 3%
• In the past twelve weeks off trade sales of champagne were down 9%, but up 13% in the on trade
• The cheaper end of the wine market (under £4 a bottle) continues to show declines. All price bands over £7 per bottle are showing double-digit growth
• On trade sales of RTDs were up 15% in volume the last twelve weeks and 3% in the twelve months to November 2012
• Inflation on wines and spirits was 2.4% and 5.9% respectively between October 2011 and October 2012. Overall inflation over the same period was 3.6%.

Commenting on the latest market report WSTA chief executive Miles Beale said: “Overall, the latest market report shows that consumers are continuing to tighten their belts and shop around for the best value in these tough economic times.

“While it is encouraging to see category growth in some areas, market conditions suggest that it remains a challenging time for both the industry and consumers.

“Given these challenging economic conditions the Government should think carefully before adding further pressure on the trade, as continuing with the duty escalator and the introduction of minimum unit pricing would do.”

5 December 2012 - Felicity Murray