EXCLUSIVE: Breweries are telling struggling pubs to ‘sneak prices up by 40P-A-PINT’ to claw back losses after lockdown ‘because people who pay by cards won’t notice hike’ – so how much has YOUR round increased?
- EXCLUSIVE: Star Pubs and Bars advised landlords ‘consider reviewing’ price hike
- Group, owned by Heineken UK, cited study on customers ‘expecting’ rise in cost
- Drinkers complained a single pint had rocked from £3.20 to £4.70 in South West
- It follows the beer giant axing 8,000 jobs globally – almost 10 per cent of its staff
- * Have prices increased at your local pub? Email [email protected] *
Have YOU noticed a price increase at your local pub?
Email [email protected]
Breweries are telling struggling pubs to ‘sneak prices up by 40p-a-pint’ to claw back losses after lockdown ‘because people who pay by cards won’t notice the hike’, the MailOnline can reveal.
Star Pubs and Bars, which is owned by Heineken UK and supports 2,500 pubs nationwide, advised bosses to ‘consider reviewing’ price increases.
The group also cited a study conducted by market research companies KAM Media and CGA between May and June last year, finding almost two thirds of pub-goers ‘expected’ price rises following the first lockdown.
One publican revealed they had recommended increases in the region of 10 per cent, meaning a pint of Peroni that once cost £4 would now cost £4.40.
But it seems that some pubs have already taken up the suggestion, with eagle-eyed punters spotting huge increases in the cost of a road since the April 12 reopening.
Drinkers have taken to social media to complain that a single pint has rocked from £3.20 to £4.70 in the South West and of prices climbing by 40p in Walsall.
Many noted that a pint of Heineken in London and Manchester now costs £5.75, saying: ‘Don’t think it would have cost this pre-lockdown.’
Pubs have revealed the cynical suggestion to pass on massive price increases to customers after landlords begged breweries for help on rent and other pandemic associated costs.
The advice has only been passed onto so-called ‘tied pubs’, those which rent premises and are tied into buying their beer from specific breweries, with many facing having to pay off huge rent debt built up during the pandemic.
Some companies, including Greene King and Stonegate, even took the initiative to slash rents by 90 per cent over the winter lockdown.
It comes as Heineken today announced that UK sales by volume plunged by around 3 per cent in the first three months of this year and axing 8,000 jobs globally – almost 10 per cent of its 85,000 staff.
Pub bosses have been told to consider hiking prices because drinkers who are grateful to return after the Covid lockdown ‘won’t notice the extra money when they pay by card’. Pictured: People enjoy drinks at London’s Borough Market on April 19
Drinkers have taken to social media to complain that a single pint has rocked from £3.20 to £4.70 in the South West and of prices climbing by 40p in Walsall
One pub landlord, who spoke to the group’s business development manager and wishes to remain anonymous, told MailOnline: ‘In their words, they were trying to work out the highest prices we can get from customers while they need beer.
‘I took it as trying to get money out of people’s pockets after a very difficult year and point black refused. They also said that most people pay by card now and they don’t really check it, so are putting up prices now as people won’t notice.
‘They recommended hiking the prices by about 10 per cent, so roughly 40p on a pint. I don’t know whether other pub companies will follow suit, but it seems to be a push for extra money within Star Pubs and Bars.
‘I certainly haven’t heard of anybody else pushing their prices up.’
Referring to the study on some customers expecting price hikes, the boss added: ‘That research was misleading to us as it’s from last year.
‘It makes out that customers are going to be happy to pay extra because they are glad to be back, which I don’t think is right, certainly not in my experience.
‘When you put prices up very rarely is a customer happy about it. They would be less happy to know that companies are using this reopening as an excuse to push prices up.’
On March 24, ahead of reopening, Star Pubs and Bars told bosses in an email: ‘If you haven’t already, now is the ideal time to consider reviewing your pricing.
‘There was a price rise in January and research by KAM Media and CGA reveals almost two thirds of pub-goers expect price increases in pubs when they return.
‘They will pay more to help support their local pub following restrictions – as long as they get value for money, so our advice is to do so.
The move aims to help pubs recoup their losses, with other companies including Greene King and Stonegate previously slashing rents by 90 per cent over winter (file photo)
In its latest update, Heineken said less than 30 per cent of the European on-trade market was operating at the start of April (file photo of bartenders pouring drinks at a pub in London)
Wetherspoon pushes back last orders by an hour from next week as chain reopens 136 more pubs
Wetherspoon will open more of its pubs across the country next week and will extend opening times by an hour as the easing of the lockdown continues, the company has announced.
A further 44 pubs in England with smaller beer gardens and outdoor areas are set to open for business from April 26, adding to the 394 which opened last week.
The new pub openings include those in Guildford, Ilkeston, Lincoln, Morecambe, Camborne, Driffield, Nottingham and Reading, and London.
All pubs remaining shut have no viable outdoor space to accommodate customers at this time, a spokesman for Wetherspoon said.
Wetherspoon will also go ahead with opening 60 of its pubs in Scotland and 32 in Wales next week and three pubs in Northern Ireland on April 30.
‘If you are planning on opening on April 12 and would like advice on the price increase prior to re-opening, especially around how much you should be putting your prices up by to maintain your current margins, please contact me by phone or email and I will be happy to help and discuss this with you.’
A spokesperson for the company said: ‘It’s not up to us to dictate pricing in our pubs, it’s up to individual pub landlords and our advice is there to help them.
‘We know from research that people are prepared to pay a bit more for a pint and are looking forward to getting back to the pub with their friends and family.’
Meanwhile, social media users have speculated about possible price hikes, with one person posting: ‘Anyone else gone back to their local pub and discovered the prices have gone up quite a lot, my local has put 40p on a pint??
‘There’s no justification for that much of a price hike!’
Twitter users in London and Manchester also grumbled about paying £5.75 for a single pint of Heineken since April 12.
Alongside a meme reading ‘what a stupid time to be alive’, one pub-goer tweeted: ‘I’ve just paid £5.75 for a pint of Heineken. In Manchester.’
Another posted: ‘£5.75 for a pint of Heineken at Canary Wharf is daylight robbery.’
A third person added: ‘First pint out. Hot takes: £11.50 for two pints of Heineken (VERY limited choice) in a very rough and ready pub in central Manchester.
‘If that’s the game they want to play then a rude awakening is coming.’
Meanwhile, Heineken announced cuts to its workforce in February as part of efforts to save cash in the face of the pandemic.
The group revealed it swung to a net loss of £176million in 2020, compared with a £1.9billion profit the previous year.
Crowds of people flock to outdoor restaurants and pub tables in Soho, central London, on April 12 after lockdown restrictions eased across England
People drink outside a pub that is open for takeaway drinks amid the Covid outbreak in London in December last year
But the beer giant – which also brews brands including Birra Moretti, Sol and Amstel – said that, across the wider group, beer volumes were in line with a year earlier when the pandemic first struck, thanks to strong growth in Africa and Asia.
Net profits soared 79 per cent to £144.9million year on year in the first quarter, but were 44 per cent lower than the same period in 2019.
Chairman and chief executive Dolf van den Brink said: ‘We had a solid start to the year, despite facing severe restrictions across many markets and the closure of the on-trade in Europe due to the pandemic.’
In its latest update, Heineken said less than 30 per cent of the European on-trade market was operating at the start of April.
But, with English pubs reopening their beer gardens on April 12 and other countries beginning to follow suit, it said trade should begin to bounce back.
People enjoy their drinks at the Fox on the Hill pub in London after its reopening on April 12 during the first phase of lockdown restrictions being eased
Punters pictured queuing to get into the George pub in Wanstead, east London, last year
The group said: ‘Our business continues to be significantly impacted by the consequences of the Covid-19 pandemic.
‘We expect market conditions to gradually improve into the second part of the year, depending on the rollout of vaccines.’
The group added that its flagship Heineken brand had a better first quarter, with sales up 12.1 per cent and double-digit growth seen in 40 countries.
It added that it has continued to support pubs affected by restrictions, waiving £16.4million of rental payments for UK customers.
Kate Nicholls, CEO of UK Hospitality, commented: ‘Hospitality businesses know their customers and their circumstances best and will make decisions based on what they feel is appropriate to their local market and to help them rebuild after an awful year.
‘For the past 12 months, venues have been either closed or trading under severe restrictions, while their costs, such as rent, have piled up.
‘The sector faces a huge debt crisis and will find the best ways to address it but the overwhelming desire is to trade our way out of this, so it’s vital that the Government’s commitment to dropping legal restrictions on June 21 is delivered upon.’
MailOnline has contacted Heineken UK for comment.
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