NEW DELHI: Beer sales in the capital have seen a huge 52% drop in the peak summer month of May this year as compared with 2022.
Industry sources said Delhi sold 83 lakh litres of beer in May this year as opposed to 173 lakh litres during the same month last year. The first five months of 2023 saw beer sales of 311 lakh litres, almost 43% down from the same period last year.
Beer sales have witnessed a sharp fall of over 40% this year in comparison to 2022 as well as pre-Covid days.
According to industry sources, Delhi sold 83 lakh litres of beer in May this year through its network of 574 shops and 900-odd hotels, restaurants and clubs, compared to 173 lakh litres last May. In 2019, before the pandemic struck, the month registered sales of 126 lakh litres.
The first five months of 2023 saw a cumulative sale of 311 lakh litres of beer, almost 43% less than the 542 lakh litres sold in the same period in 2022. In 2019, 495 lakh litres had been sold in the five months.
While the Delhi government’s excise department blames it on the weather – the mercury crossed 40 degrees Celsius on 16 days till May 31 – industry sources point to multiple reasons – less variety and brand push, non-availability of chilled options at shops, less stock in stores and companies diverting the product to states where the margins are higher.
According to excise officials, beer currently comprises more than one-third of the total volume of liquor sold during peak summer. But industry insiders say the potential is much higher, considering the intense heat and high humidity levels in Delhi for almost six months of the year. Policy changes mid-year in 2022 have shrunk beer sales by almost 50%, they added.
“Due to poor availability, those living close to border areas prefer going to Haryana and UP to buy the stock. So, the sales in neighbouring towns have been steadily increasing at 15-20% annually,” said a liquor company official.
AB InBev, a major player in the beer industry, said the availability of alcoholic beverages in Delhi stores offers a stark contrast to Gurgaon and Noida. Despite placing the order, liquor stores sometimes don’t even pick stocks in Delhi, an official said.
“We seek a level playing field across retail vends in Delhi, which is an important market. Availability of our premium brands across off-trade channels (shops) is totally divergent to our wide availability across on-trade channels in hotels, restaurants, bars and clubs in the city,” an AB InBev spokesperson said, adding, “We are working with the state corporations to make our brands available across shops in Delhi.”
A senior excise department official said while some shops were pushing certain brands, the situation was gradually improving. "We are focusing on the quality of shops now. The size of shops, stock availability and the overall buying experience are improving," said an official.
Vinod Giri, director general, Confederation of Indian Alcoholic Beverage Companies, however, said Delhi witnesses a crisis for beer in the summer because of several factors, some outside the control of Delhi government and others rooted in the Delhi excise policy and rules.
“At 550-plus, the current outlet base is grossly inadequate to serve the city size of Delhi. Many shops are small and have less space — a big problem for stocking up a product like beer. Half the shops don’t even have chillers,” he said.
“Also, Delhi excise rules force the companies’ billing price to be the lowest in the country. When demand surges, well-known brands prioritise sales to higher-margin states,” he added.
Article source: indiatimes