PROOF Insight Weekly Update

Ireland’s new alcohol labelling law causes concerns in Europe

Ireland has become the first county in the world to sign into law new regulations that requires all alcohol products to list health warnings on labels. The Minister for Health, Stephen Donnelly, has said the new law is designed to give consumers a better understanding of the health risks associated with alcohol such as liver disease, cancers and risks to pregnancy as well as bring alcohol labels in line with food labelling and tobacco products where health information is already included.

This has sparked backlash from the EU, with nine member countries including major wine-producers France, Italy and Spain, filing objections citing the regulation as incompatible with EU law. In addition, the Italian farming association Coldiretti has warned it is a “direct attack” against the country and its heritage. With the challenges the DRS posed to small-scale producers, there are fears that this too will make the Irish market no longer feasible for many small-scale producers.

The new law is set to come into force three years after the signing, in May 2026, giving businesses time to adapt to the new regulations. Impacting UK drinks producers exporting to Ireland, the broader trend for government intervention to reduce alcohol consumption is one to watch for all UK businesses.

Sources:?BBC, Irish Times, Langton Capital, The Guardian

Scrapping of EU regulations to provide the UK wine industry a ￡180m boost

The Government has proposed scrapping 400 pages of EU wine regulations which the environment secretary, Thérèse Coffey, claims will provide the sector with a "￡180m boost". This figure looks to be a combination of cost savings and sales potential. The raft of changes will cut the red tape and provide more freedom to both UK wine producers and importers.

Wine producers will be allowed to plant from a wider array of grape varieties, including more disease-resistant varieties which better suit the English climate. They will also no longer have to adhere to some packaging requirements such as foil caps and mushroom stoppers on certain sparkling wines which will reduce production costs.

Wine importers will have the ability to create new blends, carbonise, sweeten and de-alcoholise imported wines. This will allow them to create more product lines and provide wine consumers with a greater variety of choices.

Miles Beale, chief executive of the Wine and Spirits Trade Association, welcomes the range of measures, stating that wine producers and importers won’t be forced to do anything differently but that they will have the freedom to innovate. Hopes are the measures will make the UK wine market a more attractive one and perhaps ease prices for consumers (Coffey claims around 50p reduction per bottle) which is welcome news as wine is to see the biggest hike on duty in around 50 years from 1st of August 2023.

Sources:?Independent, Drinks Business, Decanter

Opportunity for premium softs despite cost of living

PROOF’s Moderating Consumer report revealed that 36% of UK adults are currently moderating their alcohol intake or avoiding it altogether. Furthermore, 3.6 million hope to give up completely one day. The report revealed that soft drinks are the most common choice for consumers avoiding or moderating, highlighting the growing opportunity in the soft drinks space.

39% of consumers reported being dissatisfied with the range of soft drinks on offer, citing a need for more options and lower sugar levels as the most desirable improvements. “Functional drinks” – those with added health benefits – can offer premium softs serves to help operators drive value from the category. Consumers listed added vitamins and protein as key health benefits, alongside drinks designed to aid sleep.

Despite the cost-of-living crisis, the opportunity in premium softs continues to grow. Britvic’s 2023 Soft Drinks Review suggested that soft drinks brands are benefitting from the “lipstick effect” – being seen as an affordable luxury during challenging financial times for many consumers. Soft drinks brands are growing at a rate +3.1pp above own-label brands, whilst the reverse is true in many other categories including baked goods, dried groceries and confectionary.

Click here?to purchase your copy of PROOF’s Moderating Consumer Report.

Sources:?PROOF Insight Moderating Consumer Report, Britvic 2023 Soft Drinks Review

Investments, Mergers & Acquisitions:??

• Cocchi Vermouth have partnered with Hoppers, the Sri Lankan restaurant in King’s Cross
• Grace Land Group have acquired London Fields Brewery from Carlsberg
• Diageo have announced plans for an aluminium recycling and manufacturing plant to reduce carbon emissions
• Farr Brew have acquired The Bell pub in Tring
• Together, previously Feast It, have raised over ￡6.5m in their most recent fundraising round
• TriSpan, a private equity firm, have invested in L’Atelier de L’Entrecote – a new “steak-frites concept”
• Moss & Co have acquired two sites including The White Horse Inn in Suffolk
• Brewdog is set to open sites in airports and train stations following a partnership with SSP
• The Restaurant Group (TRG) has put 17 sites up for sale, as part of plans to close 23 by the end of May. Most of these are Frankie & Benny’s sites
• Bolney Wine Estate is to open a new café and restaurant on its Sussex vineyard following a 91% increase in sales in the last two years

Sources:?Drinks Business, Spirits Business, Propel

Product Launches & Campaigns:

• Otter Brewery have released “Fresh Ale” – a beer aimed to sit between craft beer, cask ale and lager
• Whipshots, the vodka-infused whipped cream brand founded by American musician Cardi B, have released a lime-flavoured edition
• Appleton Estate have released a 17-year-old rum based on the Mai Tai cocktail
• Lochlea distillery have released a cask-strength single malt to their range
• Glen Moray have released Twisted Vine, a single malt whisky matured in Cognac casks
• Gleneagles hotel have released Pursuits, a collection of four single malt whiskies
• Jack Daniel’s have released a higher-ABV rye whiskey to their range
• Caffè Nero has launched its own book awards, a year after Costa Coffee scrapped their awards

Sources:?Drinks Business, Spirits Business

PROOF's Moderating Consumer Report provides a framework for understanding moderating behaviours and occasions with clear insights and recommendations on how all parties can best deliver for the moderating consumer.

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