THE IRISH DRINKS INDUSTRY

Bar sales far off boom levels as the nation cuts down on drinking

BAR sales in Ireland have yet to return to the highs seen in the Celtic Tiger, as consumers reduce their alcohol consumption levels.

Despite sales increasing by almost 4pc last year, the volume of bar sales, which includes sales of food, soft drinks and cigarettes, was three-quarters that of 11 years ago.

The failure to return to 2007 levels of sales is being driven, in part, by changes in consumer preferences, as alcohol consumption levels decline. Last year the average adult consumed what works out at just over 11 litres of alcohol, down 1.4pc on 2016, and down a massive 17.9pc on the average alcohol consumption of 13.5 litres in 2007.

Overall, the actual value of sales of alcohol in the Irish market was €6.8bn last year, up slightly on 2016 figures, according to a report from the Drinks Industry Group of Ireland (DIGI).

The report, ‘The Drinks Market Performance 2017’, has been published ahead of the launch of DIGI’s 2018 ‘Support Your Local’ campaign.

The campaign aims to highlight what the DIGI says are the positive economic, cultural and social contribution that the drinks and wider hospitality industry makes to Ireland.

The paper is also calling for Government supports to ensure the continued growth and development of the industry.

Among the supports that the report is calling for is a reduction in Ireland’s alcohol excise tax in the 2019 Budget.

Commenting on the report, Donal O’Keeffe, secretary of DIGI and chief executive of the Licensed Vintners Association, said it showed that the Irish drinks industry is robust, but that it faces a number of challenges that could plateau or even reverse its upwards growth.

“The drinks industry is integral to Ireland’s economic health,” Mr O’Keeffe said.

He added that “92,000 people work in the drinks industry alone, and the combined hospitality sector, which includes pubs, hotels, restaurants, breweries, distilleries, retailers, manufacturers and distributors, employs 204,000 people across the country”.

Among the possible threats to the industry cited by Mr O’Keeffe are Brexit, which he said made it harder for exporters in the drinks industry to plan for the future.

“If it’s harder to trade with the UK or Northern Ireland, and sterling remains weak, revenues will decline due to trade barriers and a decrease in overseas visitors,” Mr O’Keeffe said.

The report also found that consumer tastes are changing when it comes to alcohol.

While beer remains the nation’s most popular alcoholic beverage, making up a 44.8pc share of the alcohol product market last year, the volume of beer consumed was down

2.1pc on 2016. However spirits such as gin, which is enjoying something of a resurgence, saw their share of the alcohol market increase by almost 4pc to account for just under a fifth of the alcohol product market in 2017.

Wine remains the second most popular drink, making up

28pc of the market.

“The Irish drinks market is highly competitive and constantly evolving in line with consumer preferences and tastes,” Mr O’Keeffe said.

“What we’ve witnessed over the last decade is the growth of a nationwide network of

businesses flexible and eager to serve shifts in consumer taste, and develop new, innovative products and services.”

The DIGI is the umbrella organisation for the wider drinks and hospitality industry in Ireland.

Its membership spans manufacturers, distributors and the retail sectors in Ireland.

Its members include the Alcohol Beverage Federation of Ireland, Licenced Vintners Association, the Restaurants Association of Ireland, and the Irish Hotels Federation.