COVID-19 Negatively Affects On-Trade Consumption of Beer in 2020

On-Trade Consumption of Beer in 2020

On-trade volume sales of beer fell by 40% in 2020 in light of the impact of COVID-19. Off-trade volume sales of beer, meanwhile, grew by 16% in 2020 due to COVID-19’s impact.

Beer was strongly affected due to the more limited shelf life of many beer products, meaning the closures of on-trade channels and ongoing restrictions resulted in the waste of a large quantity of unsold beer.

However, beer remained popular for takeaway from on-trade establishments who were still operating with a window service, thus this helped bolster sales somewhat. A warm summer with people staying in the country and not travelling abroad also supported on-trade sales.

Sales through grocery retailers and e-commerce partially compensate for the loss in revenue through the on-trade

Small breweries were the most impacted, as they typically do not have the investment to withstand periods of downturn and depend much more on the sales of beer through on-trade establishments.

Therefore, the microbreweries which have experienced a huge boom in recent years, are now fighting for survival following the impact of COVID-19. However, it is not just the smaller breweries that felt the impact.

The Budweiser Budva brewery had to dispose of hundreds of hectolitres of tank or unfiltered keg beer, which has a very short shelf life. According to the union, the decline in production is not only due to the closure of pubs but also to a sharp drop in exports as an additional result of COVID-19.

Sales through store-based retail and e-commerce partially compensated for the loss in revenue through the on-trade. Off-trade sales were supported in different ways.

For example, Rodinny pivovar Bernard proposed a map of large warehouses where customers could purchase beer and borrow tap equipment. The company also introduced beer stored in 5-liter kegs in grocery stores and e-commerce which proved popular.

With rising operational and production costs and to compensate for the revenue loss through the on-trade, some breweries increased the price of beer sold through the off-trade in the autumn of 2020 and then again in January 2021.

There was a strong increase in the sales of canned beer. The trend was already visible toward the end of the review period but became even more evident in 2020.

Many small and microbreweries launched canned beer in 2020, such as Czech Craft Beer which introduced unpasteurised and unfiltered craft beer in cans.

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