Supermarkets keep lid on spirits price hikes

Supermarkets are holding spirits prices steady in spite of average price increases of between 2% and 6%, OLN’s annual Spirits Report has revealed.

Duty hikes and rising production costs have pushed average bottle prices up across the off-trade, with blended Scotch showing the biggest increase – up 6% to £15.10 for a 1-litre bottle, according to Nielsen’s figures for the year to August 8, 2009.

The average price for a litre bottle of malt Scotch whisky climbed 5% to £28.50, while rum prices grew 5% to £15.30 per bottle. Liqueurs and specialities saw the smallest increase, a 2% rise to £12.50.

But Tesco and Asda said their spirits prices have not gone up over the past year, and Sainsbury’s said it is working hard to stop prices rising as a result of cost hikes.

Asda’s spirits buyer Andrew Tiffin said: “Our prices have stayed roughly the same over the past year, although the impact of two duty increases has inevitably imp-acted the overall average price.”

“We are running more price-cut promotions than we used to, but that is not necessarily the right thing to do,” said Tesco’s spirits buyer Mark Suddaby. “Retailers need to be brave to protect the market from deflation.”

The overall spirits market grew 7% to £3 billion in the year to August 8, 2009, with volumes up 2% to 2.1 million hl.

Smirnoff Red Label held on to pole position in the top 50 brands league, but a 27% growth spurt saw stablemate Bell’s overtake Glen’s Vodka and The Famous Grouse to take second place.