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Galway pubs braced for backlash after massive price hike

“Unprecedented” hikes on the price of alcohol from the three biggest breweries will mean that publicans in Galway will have no choice but to pass them onto punters already reeling from the inflation crisis.

And that – according to the chairman of Galway City’s vintners – will particularly hit the traditional, local pubs where regulars would be more sensitive to price hikes.

An increase by the makers of Bulmers cider this week followed Diageo’s announcement that its 6.5 per cent rise on the price of a keg of draught beers, including Guinness, Carlsberg, Smithwicks, Rockshore, Hop House 13, was equivalent to a 12c plus VAT on a pint of Guinness. The rise will apply across its whole range from February 1.

C&C Group, the maker of Bulmers cider, is putting nine per cent on kegs and 15 per cent on bottled products for the on-trade pub sector.

Last November Heineken was forced to row back on a 9 per cent jump – 17c excluding VAT on a single pint – by splitting it between then and March to ease the pain following a backlash from publicans.

Chair of the Galway City branch of the Vintners’ Federation of Ireland (VFI) Johnny Duggan said the impact would be felt in pubs reliant on locals and regulars who would be more price sensitive.

“These are unprecedented level of increases – they’re fairly significant especially when you see the profits some of these international companies are making – they’re not local craft brewers. You’d be concerned they’re using the inflationary crisis to increase profits further and are not absorbing any of the costs,” he remarked.

“We have met with suppliers over the last few months, and we’ve been told they’re not passing on all the increases in this tough business environment. We understand we are in an inflationary cycle, everything that requires delivery is up because of fuel and anything connected with agriculture is dearer because of the price of fertiliser but I hope this is the end of it for a long time.

“It’s certainly not going to have a positive impact, but I hope they’re going to hold pricing at this level. We have to pass it on. We can’t not pass it on so it means customers will be feeling it.”

The County Galway branch chairman, Cllr Joe Sheridan, said rural publicans like him would endeavour to keep most pints below €5 to retain customers.

“Parts of Dublin they’re charging €8 for a pint – today in Dunmore it’s €4.60. They had a small increment increase two years ago and we took the brunt of that but this we’ll have to put on the price.”

He believes the sector can overcome the price increase if the Government focused on two issues – fixing the Temporary Business Energy Support Scheme (TBESS) and introducing a functioning taxi system for rural Ireland.

The TBESS pays qualifying businesses that can prove energy bills have increased by at least 50 per cent between September 2022 and February 2023 a cash payment equal to 40 per cent of the increased energy costs, with a monthly payment of up to €10,000 claimable – or €30,000 if the business is located in more than once place.

Cllr Sheridan said the scheme is deeply unfair to rural businesses as they exclude those reliant on kerosene or gas not connected to a public mains.

“A gas tank is not included in the scheme which excludes me from 66 per cent of the rebate. It’s murdering small businesses.

“The Taoiseach came out today and asked why the uptake was so poor among the pub and hospitality trade. We’ve been highlighting this to the department since October that this scheme discriminates against businesses in isolated rural locations and they wouldn’t listen.”

Launching a rural Uber system to encourage people to get home safely was another crucial step in reinvigorating rural pubs.

“They’ve spent millions on a system for local area hackney licences but over-regulation saw them all leave the industry. There’s no taxi in Dunmore, none in Milltown. Uber works in every country in the world – why can’t it work here.”

For more, read this week’s Connacht Tribune:

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