Below Cost Alcohol Sales

Below Cost Sale It is a scandal that supermarkets are allowed to use predatory pricing to undermine beer sales in community pubs. CAMRA is campaigning for an end to this practice.

Valued pubs are being driven out of business by supermarkets selling alcohol at below cost - often less than 50 pence a pint. Community pubs provide a safe and sociable environment for the consumption of alcohol and should be protected from unfair competition.

The Government recognises the problem of below cost alcohol sales but unfortunately their proposed solution will not work. The Government plan to ban the sale of alcohol at below the cost of Duty + VAT. This means supermarkets will continue to be able to sell beer for as little as 50p a pint. An investigation by the Guardian newspaper found this move would only affect 1 in 4,000 supermarket cut price alcohol promotions.

We are making progress though: The Prime Minister David Cameron has now announced that he is pushing forward plans to introduce a minimum price for alcohol. This was part of the Government’s Alcohol Strategy released in March 2012. The Government will be consulting on this issue during the summer, and the Prime Minister has indicated that the minimum unit price is likely to be set at around 40p a unit.

CAMRA supports a genuine ban on the sale of alcohol at below cost. This would take into account the cost of brewing and retailing beer. This would result in supermarkets being unable to sell beer below an average cost price of around 80p a pint. CAMRA does not support proposals for a minimum price unrelated to the costs of producing and selling beer.

An 80p per pint floor price would have no effect on real ale or pubs. Pubs, unlike supermarkets, need to make a profit on the beer that they sell and so would be unaffected by any action against below cost alcohol sales.

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