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Price hikes between brewers and pubs force vital industry debate

03 February 2023 By Jessica Mason

The price increases British breweries have been forced to pass on to publicans are being shared and debated across social media.

While the cost-of-living crisis continues and the prices for raw ingredients for brewing rise, publicans and licensees as well as brewers are showing the knock-on effect of untenable price hikes on an already vulnerable sector.

One example, seen in a recent tweet from Cheltenham-based Publican @that_pub showed how Yorkshire-based brewery Black Sheep had been left no alternative but to hike its beer prices 19.5% from 27 February. The information laid out by the brewery, which was revealed in a letter sent by its managing director Rob Theakston to his pub estate, has been recirculated on Twitter with many chiming in with their opinions on the situation brewers and pubs are now facing.

In the letter, Theakston said: “Over the last year, we have seen significant increases which have impacted on our production costs despite working tirelessly with our suppliers to minimise their effect. These increases have come from a number of sources including increased utility charges and raw material costs. These cost pressure leave us in the position of having to implement a price increase. We will be raising our published wholesale selling prices for all deliveries made on or after Monday 27th February 2023. The increase will be +19.5% excluding duty.”

@that_pub said: “Wow…19.5% excluding duty. Do you think we can charge an extra 19.5% at the pumps.”

@that_pub added: “I’m sure the reasons behind the decision are totally valid. I just don’t know how pubs can translate these kind of price rises to the pumps on top of their own rising fixed costs. Customers are not going to pay what pubs would need to charge to cover it.”

Publican @OliAshman stated: “Paid my #VAT bill today for 22 Q4, £35k. It’s another record amount due to price increases we have had to implement. Makes me wonder where all our taxes go though! My small business could fund the wages of our local village school with the taxes we pay.”

@yorkshiredalesb highlighted: “Breweries cannot be expected to take less margin otherwise they and there employees are working harder for less. With malt prices alone rising 30% in 12 months no businesses can afford not to rise prices in with line with rising production costs. For a healthy hospitality sector where good establishments flourish and their employees then the consumer must expect to pay more for their beers whether it’s cask, craft or small pack. Breweries that fight on price on a spiral of decline in quality do the industry no favours, they disappear as their business models are not sustainable. I’ve always heard that Black sheep are a good employer and their products are all of a high standard.”

@that_pub replied: “I agree and the post wasn’t a pop at that brewery, merely and example of what’s to come. Tough times all round.”

Quoting the Twitter thread, @anth_Hartley pointed out: “This is a killer for pubs & then customers it’s passed to. But many breweries will have been absorbing more than a 20% rise this past year, esp on energy & grain. The comments having a go at @BlackSheepBeer miss the point. There’re no winners here. Pubs & breweries will be lost.”

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