UK cider market suffers £35m loss

Sales of cider in the UK convenience channel could be worth more than the supermarket sector by 2020, according to IRI, as it revealed that sales of cider in the UK off-trade dropped by £35 million last year.

Apple cider blossom (Photo: Wiki)

Despite sales of cider across both the on- and off-trade surpassing £1 billion last year, the sector is still “struggling”, say analysts. Off-trade sales dropped by 3.2% in the last year to 15 August, the equivalent of more than £35 million, while volume sales declined by 3.7%, the equivalent of 481 million litres.

Poor summer sales were cited as the primary factor driving this decline, with cider sales having been “lower than average” for the past two summers. In 2014 the FIFA World Cup resulted in many switching to beer, denting sales of cider, while this year the cooler weather was blamed for a dip in summer sales.

More competition within the market was also a cause of decline, along with the increasing need for producers to fight harder for shelf space. Cider producers are competing against not only new cider brands entering the market – such as new fruit ciders – but other alcohol growth segments such as Prosecco, noted analysts.

Sales of fruit flavour ciders increased by 23% – £45m – in the last year, according to the IRO, with Kopparberg currently the UK’s second bestselling cider totalling sales of £112m in the last year.

“Cider should have made a come-back after last year’s poor summer but didn’t”, said Toby Magill, head of beer, wine and spirits Insights at IRI. “Life is about to get tougher for cider manufacturers. The poor performance of some cider segments – notably mainstream apple cider products – will be top of mind for retailers as they continue to trim lines. They are increasingly likely to favour the new innovative cider products and premium ranges that are showing impressive sales growth.”

IRI analysts identified a £65m sales opportunity for premium and traditional ciders within the convenience channels, with brands such as Westons, Thatchers and Aspalls said to be leading the premium charge. If fully exploited by convenience retailers, sales of cider in this channel be “worth more than supermarket sales by 2020″, predicts Magill.

“Nearly half of all cider sales are currently in the convenience channel”, he explained. ” Value and mainstream ciders do very well in convenience retailers, but we see more opportunity for premium and niche cider manufacturers to increase their share of the growing convenience channel while the supermarkets continue to focus on reducing rather than increasing range choice and so that they can capitalize on the changing consumer taste for premium cider.”