In the same week the government announces its ban on below cost alcohol sales, Sainsbury's has cut the cost of some its ‘low alcohol’ wines and beers by a quarter on the cynical pretence, some might say, of encouraging a reduction of alcohol intake.
A minimum resale price of 50p-per-unit minimum was backed by health campaigners and might have levelled the playing field; corner shops and pubs may once again be able to compete with supermarkets on off-premises sales.
The proposed ban is based on a duty plus VAT rate, which sets the minimum cost for alcohol as follows;
£10.71 for a litre of vodka
38p for 440ml of lager
40p for a litre of cider
The proposed rate is not likely to help local shopkeepers who, when questioned by the BBC News website said the government's proposed minimum prices were far below what they had to charge to generate a profit. The minimum rate and further reductions in the cost of supermarket alcohol is unlikely to help the UK Pub industry either; publicans have learned in the last few years that they need to diversify their business in order to survive. However, their core business remains alcohol sales.
Paramount Investments spokesperson commented that “While changes will be welcome news to an industry which struggled during 2011 publicans must capitalize on any benefit and strive to keep punters when they re-emerge in 2012.”
“They must offer something extra - music, darts, pool, live music to other forms of entertainment. They must offer a clean vibrant atmosphere/image and serve good home-cooked food at affordable prices - it is essential they make the most of any opportunity they are given to recapture a share of the market-place.”
Pub Trade News
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