The Pub trade is dying - Minimum price for Alcohol?

Naikon

HellFireClub wrote: »

Yes you can compare them, and you can also compare their overheads and see very clearly that the bigger organisation has higher overheads, but has more customers that those overheads get spread across. The business financial models are completely different, but they are comparable.

There are only two facts relevant here:

(1) No other industry in Ireland is as ruthless when marking up their products as the publicans in this country.

(2) No other industry does as much moaning about lack of custom and trade, despite the fact that they are behind the highest gross profit margins being applied to retail consumer products in this country. Show me any other business that is currently moaning about having no customers but is yet still marking up their products 4-5 times what those products cost them?!?!?

There is clearly a relationship between (1) and (2) above and the sooner these goons start waking up to it and stop p*ssing everyone off with their whinging, the sooner they might have viable businesses to run.

Yes, I agree the markup is crazy for some pubs. You can't expect pubs to sell beer at the same price per bottle as tesco though. This is my primary argument. I am all for pubs introducing fair prices, but I can't delude myself to believe pubs should offer punters a beer at a euro. Regardless of market conditions, pubs will ALWAYS have to charge more. It's simply the nature of the game. This is why I agree with the introduction of a minimum pricing scheme.

TheUsual

ardinn wrote: »

Just a "FYI" The VFI is not a purchasing organisation - I actually dont think they are allowed by law, If they were you would certainly see a reduction in the price of drinks.

Just a "FYI" back at you, the Competition Authority last year threatening the VFI about price freezes.

http://www.irishexaminer.com/ireland/ididcwaumh/

Fitzerb

HellFireClub wrote: »

Yes you can compare them, and you can also compare their overheads and see very clearly that the bigger organisation has higher overheads, but has more customers that those overheads get spread across. The business financial models are completely different, but they are comparable.

There are only two facts relevant here:

(1) No other industry in Ireland is as ruthless when marking up their products as the publicans in this country.

(2) No other industry does as much moaning about lack of custom and trade, despite the fact that they are behind the highest gross profit margins being applied to retail consumer products in this country. Show me any other business that is currently moaning about having no customers but is yet still marking up their products 4-5 times what those products cost them?!?!?

There is clearly a relationship between (1) and (2) above and the sooner these goons start waking up to it and stop p*ssing everyone off with their whinging, the sooner they might have viable businesses to run.

100% RUBBISH, Show us the proof for marking up profits by 500%. posts such as this just P**s me off as they are not factual.

I dont work in or own a pub and yes they can moan but in any debate lets be fair and factual. Some of the trade is hanging by finger nails and you can expect to see serious job impact in the coming months

ardinn

TheUsual wrote: »

Just a "FYI" back at you, the Competition Authority last year threatening the VFI about price freezes.

http://www.irishexaminer.com/ireland/ididcwaumh/

Whats that got to do with what I said??

starbelgrade

ardinn wrote: »

Hello again

Just a "FYI" The VFI is not a purchasing organisation - I actually dont think they are allowed by law, If they were you would certainly see a reduction in the price of drinks.

I know that they are not a purchasing organisation, but there is no law to prevent the VFI from negotiating better terms with key suppliers.

And there is also no law to prevent publicans in from clubbing together to negotiate better supply prices from suppliers.

As I said before - what publicans need to do is a hell of a lot more than just open their doors, expect the customers to flock in, then turn to the government for protectionist measures when they don't.

Those days are over & the sooner publicans realise that, the sooner their businesses will start making money again.

HellFireClub

Naikon wrote: »

Then shop elsewhere.

I do, and so do a lot of other people who elect not to be price gouged and stay away from the pub, causing many of them to go out of business while the remainer want to force me to buy in an artificially controlled market where the price is kept high by political meddling in the market. Thank Christ those days are gone and such nonsense is now illegal and in breach of EU competition law.

Fitzerb wrote: »

You are not making a correct comparison. 95% of Pubs do not buy their bottled beer from Diageo, they only buy kegs from Diageo. Bottled beers are supplied through various Irish License Wholesalers.
The Wholesaler can buy the bottled beer cheaper in Tesco than he can buy if from Diageo, so the publican is not making this alleged massive mark up on bottled beer. I am not sure what the situation is with Kegs. Supermarkets are selling bottled beer as a lost leader, just to get footfall through the shop. Its not healthy and will cost us a significant loss of employment for Irish people in the industry. I know of one town (Mountrath) that had 25 pubs 10 years ago, It now has 2, so there will be closures because of the change in habits and the industry has to wake up that the business model has to change. Pubs who are now offering quality food at a good price can hit back if more people dine out.
We are now close to a crazy position that we can buy beer cheaper than milk in Tesco, I wonder if Tesco started to sell tobacco below cost would the Government intervene, there is a need to stop the Multiple trade from selling at below cost on beers, it is going to cost us jobs and will inflate an already binge drinking culture.

Yes he is, if he is buying Millar at 75 cent a bottle, which is the price it was at retail in Tesco on the news this afternoon, and selling it for over a fiver, that is a massive mark up and there is no avoiding that. The publicans mind seems to be completely shut to the fact that if he charged that out at under 3 Euro, and marketed his business properly with regard to promoting that kind of value, he would have a lot more people on his premises drinking more bottles of Millar!

So what if we can buy milk cheaper than beer in Tesco?!? Milk isn't cheap to produce and manage from the cow up to the supermarket shelf and has a very short shelf life.

Also, if Tesco is selling more beer because it is better value and the consumer market is buying from Tesco instead of the pubs, what makes the jobs created in Tesco any less valuable than the job lost in a pub that has simply priced itself out of the market???

Fitzerb

fonecrusher1 wrote: »

Suggestions to turn things around for pubs.

- lower prices by at least 20% (obviously i mean pubs that are charging silly money for a pint ie; e5.20)
- free food. Sausagerolls, sandwiches, cocktail sausages every hour.
- Don't charge for water or water with cordial.
- Don't piss people of by charging them 3 - 5 euros for a pint of coke/fanta/shandy whatever
- Don't piss loyal customers off by charging them an entry fee on New years eve.

Just compromise. Re-earn people's loyalty.

Some positive stuff there...... Lets make it family friendly up to a certain hour, And have the toliets clean, Have no TV areas so people who just want to have a chat can do so and train the staff to respect the customer............ Ok problem solved

Naikon

HellFireClub wrote: »

I do, and so do a lot of other people who elect not to be price gouged and stay away from the pub, causing many of them to go out of business while the remainer want to force me to buy in an artificially controlled market where the price is kept high by political meddling in the market. Thank Christ those days are gone and such nonsense is now illegal and in breach of EU competition law.



Yes he is, if he is buying Millar at 75 cent a bottle, which is the price it was at retail in Tesco on the news this afternoon, and selling it for over a fiver, that is a massive mark up and there is no avoiding that. The publicans mind seems to be completely shut to the fact that if he charged that out at under 3 Euro, and marketed his business properly with regard to promoting that kind of value, he would have a lot more people on his premises drinking more bottles of Millar!

So what if we can buy milk cheaper than beer in Tesco?!? Milk isn't cheap to produce and manage from the cow up to the supermarket shelf and has a very short shelf life.

Also, if Tesco is selling more beer because it is better value and the consumer market is buying from Tesco instead of the pubs, what makes the jobs created in Tesco any less valuable than the job lost in a pub that has simply priced itself out of the market???

I don't think too highly of any pub that uses tesco as a supplier. This is a bit of a grey area imo. I don't know of any local pub that does this, though I have known one pub in particular to use watered down spirits. I don't think it's fair to presume most pubs are doing this. I would be suspicious of any pub that bought from tesco imo.

x in the city

pubs are shoite and hardly anyooe goes to them are not soley based on paying about 5 euro for a pint

other reasons are 3 euro or so for a mineral

toilets which resemble trainspotting

lack of quality food

HellFireClub

Fitzerb wrote: »

100% RUBBISH, Show us the proof for marking up profits by 500%. posts such as this just P**s me off as they are not factual.

I dont work in or own a pub and yes they can moan but in any debate lets be fair and factual. Some of the trade is hanging by finger nails and you can expect to see serious job impact in the coming months

It's simple maths, if you buy something for 75 cent and sell it out for 5 Euro, you are making a gross profit of 4.25 Euro on that transaction. Based on making 4.25 Euro on something that you paid 75 cent for, you are making a gross margin on that product of 566.6%. Don't forget the publican is paying less than 75 cent for the bottle of Millar in Tesco because he can claim the 21% VAT back.

So if you take the 21% VAT out of the calculation which is 13 cent, the publican is paying 62 cent for the bottle of Millar. Still charging it out at 5.00 Euro, that's a gross profit margin of 706.5%.

You show me any other business in Ireland putting a gross margin of 706% on their stock and moaning about having no customers, will you get real ffs...

TheUsual

ardinn wrote: »

Whats that got to do with what I said??

That the VFI have no control over the price of their product.
Heaven forbid that they would gang together and keep their profit margins.

blondie83

Naikon wrote: »

Yes, I agree the markup is crazy for some pubs. You can't expect pubs to sell beer at the same price per bottle as tesco though. This is my primary argument. I am all for pubs introducing fair prices, but I can't delude myself to believe pubs should offer punters a beer at a euro. Regardless of market conditions, pubs will ALWAYS have to charge more. It's simply the nature of the game. This is why I agree with the introduction of a minimum pricing scheme.

No one expects pubs to sell beer at a euro a bottle, or at the same price as Tesco. People have said here several times that they accept there will have to be a mark-up, and just want it to be a fair one. Suppose a publican buys bottles at €1 each and sells for €3 each - surely that would seem fair? 200% mark-up to cover costs, and people could actually afford to drink it!

Naikon

HellFireClub wrote: »

It's simple maths, if you buy something for 75 cent and sell it out for 5 Euro, you are making a gross profit of 4.25 Euro on that transaction. Based on making 4.25 Euro on something that you paid 75 cent for, you are making a gross margin on that product of 566.6%. Don't forget the publican is paying less than 75 cent for the bottle of Millar in Tesco because he can claim the 21% VAT back.

So if you take the 21% VAT out of the calculation which is 13 cent, the publican is paying 62 cent for the bottle of Millar. Still charging it out at 5.00 Euro, that's a gross profit margin of 706.5%.

You show me any other business in Ireland putting a gross margin of 706% on their stock and moaning about having no customers, will you get real ffs...

I am not aware of any pub that can aquire a bottle Miller for 75c. Care to back up what you are saying? Have you ever actually managed stock/inventory in a pub?

ArtSmart

fonecrusher1 wrote: »

Suggestions to turn things around for pubs.

- lower prices by at least 20% (obviously i mean pubs that are charging silly money for a pint ie; e5.20)
- free food. Sausagerolls, sandwiches, cocktail sausages every hour.
- Don't charge for water or water with cordial.
- Don't piss people of by charging them 3 - 5 euros for a pint of coke/fanta/shandy whatever
- Don't piss loyal customers off by charging them an entry fee on New years eve.

Just compromise. Re-earn people's loyalty.

yup.

i wonder if a poll was taken how many wud have sympathy for publicans? (who arent actually pubs/ or pub relatives)

very few i'd say.

i watched the steps over time

1/ charging big bucks for individual 'splits' (bottled soft drinks) - even to a family with kids instead of the big bottle option.

2/ charging the lad who doesnt want to drink for the night for his Miwadi and water. cynical beyond measure

3/stopping the sambos


4/latching whole-heartedly onto the long neck phenomena with both hands firmly around it's overpriced neck.


actually the list is huge - i'll let others have a go

Naikon

blondie83 wrote: »

No one expects pubs to sell beer at a euro a bottle, or at the same price as Tesco. People have sadi here several times that they accept there will have to be a mark-up, and just want it to be a fair one. Suppose a publican buys bottles at €1 each and sells for €3 each - surely that would seem fair? 200% mark-up to cover costs, and people could actually afford to drink it!

Yes, this is the point I am trying to make all along. Some people seem to think that it is reasonable that pubs should sell at a loss to compete with tesco. This is a cop out. I don't know any local pubs that charge more than 3.50 for a pint. Seems pretty reasonable to me. 5.00 euro, not so much. Tesco is not comparable to a pub. Therefore you can't expect a pub to offer beer at knockdown supermarket prices. It's not that hard a concept to grasp imo. Hopefully, the pubs charging 6+ euro for a pint will be forced to change. I don't condone tesco supplier jobs either...

HellFireClub

Naikon wrote: »

I am not aware of any pub that can aquire a bottle Miller for 75c. Care to back up what you are saying? Have you ever actually managed stock/inventory in a pub?

You obviously missed the Six One News this evening when the reporter went into Tesco and pulled a bottle of Millar off the shelf and said it was 75 cent. A pub has a VAT number so they can claim the VAT back, meaning the same bottle costs them 13 cent less...

http://www.rte.ie/player/#v=1088059

fonecrusher1

How much would a pub pay for a barrel of beer? And how many pints would they get out of a barrel?

ardinn

starbelgrade wrote: »

I know that they are not a purchasing organisation, but there is no law to prevent the VFI from negotiating better terms with key suppliers.

The VFI IS and has been negotiating better prices for years - the supplier just wont budge..

The cost of purchases in the UK has risen over 15% in the last 2 years while it has not increased at all here, Due to constant lobbying from the VFI. You are saying they are not (or implying they are not) and this is yet again mis-informed

starbelgrade wrote: »

And there is also no law to prevent publicans in from clubbing together to negotiate better supply prices from suppliers.

Eh - if pubs do this then charge the same for their products this is deemed as price fixing!

starbelgrade wrote: »

As I said before - what publicans need to do is a hell of a lot more than just open their doors, expect the customers to flock in, then turn to the government for protectionist measures when they don't.

Please give us some examples of what you would do - honestly - i'd like to hear some ideas.

starbelgrade wrote: »

Those days are over & the sooner publicans realise that, the sooner their businesses will start making money again.

I realise I have to work and work hard to get customers in my premises - its working but things are tight and so on - the same with any business. but trying to protect your business from the massive multi's like tesco and the like is a priority. Of course it is!!

They will soon have control of most things - you can buy cars in british tescos you know - there is no toy shops left in my area - no grocers - very few butchers - no music shops. tesco and multi's have closed them all - and when you have no alternative than to go to them in the end - you'll probably find them quite dear.

Dr_Phil

oppenheimer1 wrote: »

So would you be disappointed if the Pub trade shrank dramatically?

No, let them go. Expensive, loud places with no atmosphere full of noise, TV's and ar5eholes.

Naikon

HellFireClub wrote: »

You obviously missed the Six One News this evening when the reporter went into Tesco and pulled a bottle of Millar off the shelf and said it was 75 cent. A pub has a VAT number so they can claim the VAT back, meaning the same bottle costs them 13 cent less...

http://www.rte.ie/player/#v=1088059

Yeah, most pubs aren't being supplied from tesco. You do understand this?

Atlantic Dawn

Scotland recently introduced minimum pricing but it wasn't to protect pubs its was to limit binge drinking amongst children. Perhaps the government should allow just the pubs to sell off-license alcohol after 10pm, that would give them some additional business and an advantage over the supermarkets.

HellFireClub

Naikon wrote: »

Yes, this is the point I am trying to make all along. Some people seem to think that it is reasonable that pubs should sell at a loss to compete with tesco. This is a cop out. I don't know any local pubs that charge more than 3.50 for a pint. Seems pretty reasonable to me. 5.00 euro, not so much. Tesco is not comparable to a pub. Therefore you can't expect a pub to offer beer at knockdown supermarket prices. It's not that hard a concept to grasp imo.

Nobody is expecting them to offer it at the same price, people are just expecting them to be competive and offer some long overdue value for money and also up their game, stop giving us toilets with an inch of stale p*ss on the floor and a bar with rude ignorant barstaff.

To be honest, given the type of enterpreneur we are dealing with in the publican, it is too late for most of them, it'll take a generation for another type of half decent publican to emerge and "get" what customer service and business accumen actually is actually all about...

ArtSmart

HellFireClub wrote: »

It's simple maths, if you buy something for 75 cent and sell it out for 5 Euro, you are making a gross profit of 4.25 Euro on that transaction. Based on making 4.25 Euro on something that you paid 75 cent for, you are making a gross margin on that product of 566.6%. Don't forget the publican is paying less than 75 cent for the bottle of Millar in Tesco because he can claim the 21% VAT back.

So if you take the 21% VAT out of the calculation which is 13 cent, the publican is paying 62 cent for the bottle of Millar. Still charging it out at 5.00 Euro, that's a gross profit margin of 706.5%.

You show me any other business in Ireland putting a gross margin of 706% on their stock and moaning about having no customers, will you get real ffs...

there are legal restrictions involved - they cant buy from supermkts and there are other restrictions. BUT, that's not really the point

the pub IS NOT IN COMPETITION with supermkts.

that's like saying restaurants are in comp with supermkts bec people eat at home.

as usual the VFI are looking at the easy way out.


ther blantant greed on many (not all) publicans have them where they are now.

hopefully they'll start recognising that people want respect, service , comfort etc etc. alcohol they can get a home.

Fitzerb

HellFireClub wrote: »

I do, and so do a lot of other people who elect not to be price gouged and stay away from the pub, causing many of them to go out of business while the remainer want to force me to buy in an artificially controlled market where the price is kept high by political meddling in the market. Thank Christ those days are gone and such nonsense is now illegal and in breach of EU competition law.



Yes he is, if he is buying Millar at 75 cent a bottle, which is the price it was at retail in Tesco on the news this afternoon, and selling it for over a fiver, that is a massive mark up and there is no avoiding that. The publicans mind seems to be completely shut to the fact that if he charged that out at under 3 Euro, and marketed his business properly with regard to promoting that kind of value, he would have a lot more people on his premises drinking more bottles of Millar!

So what if we can buy milk cheaper than beer in Tesco?!? Milk isn't cheap to produce and manage from the cow up to the supermarket shelf and has a very short shelf life.

Also, if Tesco is selling more beer because it is better value and the consumer market is buying from Tesco instead of the pubs, what makes the jobs created in Tesco any less valuable than the job lost in a pub that has simply priced itself out of the market???

You are assuming that every publican is purchasing his beer in Tesco, that is not the case. Some are but the majority are not. If they were all to do that the business would lose hundreds of jobs through the wholesaler sector. One the problems that the license trade has (of its own making) is that they under invested in the comfort of the premises and when the drinking habits started to change they then had to re invest at a time when building costs were extreme. I think a bar man will earn a far higher wage then any Tesco employee on the till and wages are a big driver of costs. Look at the price of SKY TV for a Publican, I did hear it and while I cant remember the cost but it runs into thousands a year. You will notice a small pint emblem in the corner on Sky TV in a pub.
There is nothing wrong with the jobs in Tesco but let me tell you that Tesco will wait until the alcohol trade is crippled in Ireland and when the market is cornered they will change their pricing structure.
Speak to people who work in the FMCG sector in Ireland and ask what support Irish industry is receiving from Tesco.

OPENROAD

Naikon wrote: »

Yes, this is the point I am trying to make all along. Some people seem to think that it is reasonable that pubs should sell at a loss to compete with tesco. This is a cop out. I don't know any local pubs that charge more than 3.50 for a pint. Seems pretty reasonable to me. 5.00 euro, not so much. Tesco is not comparable to a pub. Therefore you can't expect a pub to offer beer at knockdown supermarket prices. It's not that hard a concept to grasp imo. Hopefully, the pubs charging 6+ euro for a pint will be forced to change. I don't condone tesco supplier jobs either...

In Dublin? and is that for all beer?

choons

goose2005 wrote: »

Tesco should also charge a minimum price for food - after all, how are restaurants supposed to compete?

BOOM!

ardinn

TheUsual wrote: »

That the VFI have no control over the price of their product.
Heaven forbid that they would gang together and keep their profit margins.

What?? the VFI doesnt buy anything - how can they have control over the selling price of it?

It was a voluntary scheme where it was actually a ceiling - not a freeze, which publican COULD lower their prices - the CA twisted that into a price fix - even tho the price in almost every pub varies!

ardinn

Atlantic Dawn wrote: »

Scotland recently introduced minimum pricing but it wasn't to protect pubs its was to limit binge drinking amongst children. Perhaps the government should allow just the pubs to sell off-license alcohol after 10pm, that would give them some additional business and an advantage over the supermarkets.

Intelligent idea.

Naikon

OPENROAD wrote: »

In Dublin? and is that for all beer?

Not in Dublin. Everything in Dublin is pretty expensive I find. I hope people aren't paying 6 euro for a beer anywhere. Just fyi, this price applies to all draught beer in my residential local at any time.

HellFireClub

Naikon wrote: »

Yeah, most pubs aren't being supplied from tesco. You do understand this?

As a consumer, I'm really not interested in where they are getting their supplies from. Consumers are fickle creatures and when they go out for a pint, they go out to enjoy themselves, not start an argument with their barman as to where he is getting his supplies from

All I'm prepared to concern myself with as a punter, is the quality of the product and the cost of me. It is a well known fact that many publicans are going up the north to buy cheap bottles of alcohol or at this stage the prices are so cheap in the multiples, they don't even have to go up north to get the best price to them.

The issue is not where they are buying them, the issue continues to be what they are trying to sell them for and the market isn't running with any of it! So what do these folks so??? They try to lean on the government to come out and politically meddle in the market to drive up the sale price for their competitors?!?