Drinkflation: Breweries slash alcohol content to cut cost

Some of Britain’s best-known breweries are being accused of slashing their alcohol content, or ABV (alcohol by volume) over recent months as they scramble to cut costs in their own inflation squeeze.  

According to recent reports, Fosters, Spitfire, Old Speckled Hen, and Bishop’s Finger are among the tipples that are said to be indulging in what is now being dubbed as “drinkflation”, a move when brewers cut the alcohol content of their beers as a way to save on tax.  

Levy is charged on the percentage of alcohol in a beer, so cutting back ABV is an easy way to make savings.  

Foster’s, which is owned by Dutch brewing giant Heineken, was reduced from 4 per cent to 3.7 per cent ABV this year. The change has saved Heineken 3p of tax per can, The Telegraph stated in a report this week. Despite reducing the strength of Foster’s, Heineken increased the price of a keg of the lager sold to the pub trade by 15.8 per cent in January.  

Meanwhile, Shepherd Neame in Kent has cut the ABV of its best-selling Spitfire ale from 4.5 per cent to 4.2 per cent, saving it 3p on each 500ml bottle. Its Bishop’s Finger ale has weakened from 5 per cent to 4.8 per cent, saving 2p per bottle on tax.  

A Shepherd Neame spokesman said, “In line with other breweries, and most food and drink producers, we have seen significant increases in the cost of raw materials, energy and energy-related products such as glass. These increases are well above the headline rate of inflation. Whilst we are doing everything possible to mitigate these costs, we have had to increase the price of all our beers.”  

At Greene King brewery in Suffolk, Old Speckled Hen is now made at 4.8pc ABV rather than 5pc, shaving 2p off the tax bill of each bottle. A Greene King spokesman admitted to the publication that cutting alcohol content was a way to mitigate “significantly increased” costs as it “lowers the duty we pay without noticeably affecting the beer’s flavour”.  

Industry consultant Bill Simmons stated that since there is a “real push by the supermarkets to keep the food inflation down,” reducing the alcohol content is a “good ploy” as brewers work on pretty shallow margins and they “have got nowhere to go – They can’t change the pack size”.  

The rise of “drinkflation” comes as many shoppers are also choosing to buy weaker beers because they don’t want to consume as much alcohol.  

“The biggest growth in the beer market today is in [low and non-alcoholic]. Anyone under 45 is not drinking high alcohol beers, or if they are they’re drinking them in low quantities. Today, the young are saying ‘we’re not really interested in alcohol, we prefer to drink a no or even a low’,” the report quoted Simmons as saying.  

The trend mirrors shrinkflation where products get smaller while the listing price stays the same or rises.