Executive Summary

This report presents an analysis of the UK low- and no-alcohol drinks market. It covers each of the following sectors of the market in detail: beer, wine and cider. The term `no-alcohol drinks' refers to drinks with an alcohol content of less than 0.05% by volume. It does not refer to soft drinks.

The overall market for alcoholic drinks, excluding spirits, is estimated in 1994 as being £20.6bn. Against this background, the market for low- and no-alcohol products is small, an estimated £167.5m.

The market for low- and no-alcohol drinks peaked in 1989/1990, with sales of £206m, and has declined to sales of £174m in 1993. This represents a decrease of 15.5% by value.

Much of the decline in sales has been due to people choosing to drink soft drinks rather than low- and no-alcohol products. This has now become a socially acceptable practice in public houses.

The major players in the market are the large brewers, such as Whitbread, Allied Domecq PLC, Bass PLC, HP Bulmer Holdings PLC, Courage Ltd, and Scottish & Newcastle PLC.

The no-alcohol products are the ones which have suffered the most, and in many product areas there has been an increase in sales of reduced-alcohol products. The majority of the larger breweries have reduced the number of no- and low-alcohol products they produce or distribute, and many have stopped producing these products altogether. The quality of the remaining products has improved dramatically as far as taste is concerned, through the use of new production techniques. However, consumers may well be reluctant to try these new products if they have had a poor perception of previous products.

In 1990, the value of the no- and low-alcohol beer market was £176m. By 1993, this had declined to £120m, representing a 32% decline in the market by value.

The market for low- and no-alcohol wine has increased from £25m in 1990, to £50m in 1993. This was an increase of 100% by value. The market for low-alcohol cider has decreased from £5m in 1990 to £4m. This is an decrease of 20% by value. Key Note expects the market will stabilise, and will probably expand should there be any changes in the drink/drive laws. Changes such as the introduction of the random breath test, or the introduction of a lower acceptable level of alcohol in the blood would definitely lead to a change in the market dynamics. The market expansion would be as much as 20% if and when this legislation is introduced. The current fascination in the UK regarding health issues also could have the effect of promoting an increase in consumption of the no- and low-alcohol products. It is anticipated that the best brands will survive and they will retain a small, but permanent place in the market.

More Information

  Denotes a required field.