Decline in the Number of Public Houses in the UK - Report Example

The rise of cheap supermarket beer and the decline in the number of public houses in the UK. Introduction The decline of the British pub is an undeniable fact of contemporary life. So to is the increasing availability of inexpensive beer, wine and spirits in supermarkets. The connection between this two facts is also often cited in the popular press. The following discussion will investigate the connection between these two facts. While the two facts are contemporaneous hat does not mean that he one is the cause of the other. Post hoc ergo propter hoc may simply be a logical fallacy in this case and the causal relationship may not exist in fact. Analysis of this fact will commence with demonstration of the two facts in the case. First, the decline of the pub. Second, the increase in off license and in the home drinking and the increasing availability of inexpensive beer, wine and spirits in supermarkets. Subsequently, other possible explanations for the decline of the pub will be examined. Importantly, there are a host of other factors at play. Consequently, the decline of the pub may be related to other factors and have little to do with the availability of cheap supermarket beer. Alternately, cheap supermarket beer may be an important factor in the decline of the pub, but not the most important one. All of these possibilities will have to be considered. The Decline of the Pub The decline of the pub is an obvious and incontestable fact of modern British life. It is evident in villages and towns throughout the United Kingdom. In major metropolitan centres the availability of nightclubs, martini and wine bars and diverse other licensed establishments also testifies to the decline of the pub. In statistical terms the British Beer and Pub Association calculates that 39 pubs are closing every week, that is a phenomenal 2000 pub closures annually. The chart below also provides clear evidence in the increase in drinking at home and the decline in drinking in licensed establishments. Year Where All alcoholic drinks (ml/person) Beer (ml/person) Cider and perry (ml/person) Wine (ml/person) Spirits (ml/person) 2001/02 In the home 735 386 55 236 39 2002/03 In the home 726 380 50 239 39 2003/04 In the home 792 416 64 251 41 2004/05 In the home 763 395 55 261 38 2005/06 In the home 739 377 52 262 38 2006 In the home 760 393 59 255 41 2007 In the home 772 384 75 263 42 2008 In the home 706 350 69 242 38 2001/02 O/S the home 733 623 21 20 21 2002/03 O/S the home 704 592 20 20 21 2003/04 O/S the home 664 557 20 21 22 2004/05 O/S the home 616 515 18 22 20 2005/06 O/S the home 597 499 16 22 20 2006 O/S the home 561 459 24 23 18 2007 O/S the home 503 400 28 19 17 2008 O/S the home 443 358 21 18 14 SOURCE: NHS INFORMATION CENTRE While drinking in the home remained relatively stable between 2001 and 2008 drinking outside the home declined by 40 percent. With reference to beer alone consumption outside of the home declined by 43 percent while consumption in the home declined by only 9 percent. Overall, therefore beer consumption between 2001 and 2008 declined overall by 30 percent and the lions share of that decline occurred in drinking of beer outside the home. Cheap Supermarket Beer At the same time the decline in the price of beer at supermarkets is widely noted. Shockingly, in 2007 The Telegraph reported that supermarkets were selling cheap foreign lagers for less than bottled water! “The major supermarkets are locked in a fierce price war which means that in some cases cans are so cheap that the stores actually pay more in excise duties than they charge at the till.... “ At the time Tesco, Sainsburys and Asada were selling cans of lager for 22p, equivalently sized soft drinks for 30p, and equivalently sized bottles of water for 31 p. (“Supermarket beer cheaper than water”, 2010) As of November 24, 2010 Tesco, Sainsburys and Asada all sell OL Value Lager at 92p for a four pack or 23p each. Moreover, consumers can even track the prices of ale and lager on the website, Supermarket Special Offers. “Beer and Wine” (http://www.supermarketspecialoffers.com/BeerandDrinkOffers.aspx). Cheap supermarket beer is as much a fact of life in modern English life as is the decline of the pub. Other Factors in the Decline of the Pub Clearly, the availability of cheap supermarket beer is a factor that will figure in the minds of consumers when they debate between a trip to the pub and drinking a glass of lager at home. Further, in the wake of a global recession it is only reasonable to assume that the relatively low price of drinking at home would be an even more influential factor in the last two years. However, there are a host of other factors influencing the decline of the pub that must also be given consideration. Historian John Walton traces the decline of the pub to the rise in popularity of fish and chips. In the 1930s, long before supermarkets were even present in the British landscape the take away fish and chips trade was booming. Watson attributes the decline in the pub to the disconnect between pubs and eating: “He suggests that “it may well be significant that the rise of the fish and chip shop coincided with the beginnings of the long decline of the pub.” (Watson, 1992) According to Watson the decline of the pub began long before cheap supermarket beer was even available to consumers. The General, Municipal, Boilermakers and Allied Trade Union (GMB) represents many of the 600,000 persons employed in pubs. It traces the problem not to inexpensive supermarket beer per se but rather, to the artificially inflated prices in pubs. In September 2010 Paul Kenny, GMB general secretary told The Guardian, "Britains community pubs are on a life support machine and if the poison of high rents and artificially inflated prices is not removed it is not an exaggeration to say that these pubs will disappear and thousands of jobs will disappear as well.” The GMB report released in September 2010 noted that sales of alcohol in pubs had declined by 25 percent since 2002, and made the same point, “artificially high prices that tied pub tenants have to charge to recover the [alcohol prices] and rents charged by the pubcos who own the freehold of the pub properties.” (Goodley, 2010) This is a subtle but important point. According to the GMB the problem is not inexpensive supermarket beer but rather, unnecessarily expensive pub beer. These two arguments also introduce a second important set of arguments about the decline of the pub. There is a social disconnect between the pub and the population that was not present in the past. Historically, pubs have filled a variety of roles. They were dining establishments, they were community centres were people gathered to discuss and recognize everything from hatch, match and dispatch (births, marriages and deaths) to politics. (Watson, 1992) However, in contemporary England all of these roles of the pub have declined. Supermarkets and modern appliances have made eating in the home more convenient. Restaurants and take away establishments have made pubs less important as dining establishments. Any pubs now offer take away food which is a clear reflection of this trend. Also community centres, shopping malls and other venues now provide alternative locations to congregate and socialize. The pubs ancillary functions and social role are declining in modern England. The result is decreased attendance at pubs and, inevitably, decreasing alcohol sales. Mobility and urbanization has also undermined the social role of the pub. With the increasing urbanization of modern England the rural population is declining and customers for rural pubs are, by definition, declining. Closures of rural pubs are the majority of the 2000 annual pub closures that are currently occurring in the United Kingdom. Increasing mobility means that persons often pursue their education and their career in a community other than the one that they were born in. Other persons live in one community but commute to work in another community. All of these developments act to reduce a persons connection to their local. The very use of the term local for a pub implies a geographic connection. However, these geographic connections to place have declined in modern England and, consequently, has the importance of local pubs. Furthermore, alcohol consumption overall is declining in the United Kingdom. People are drinking less alcohol per capita than they have in the past. If cheap supermarket beer was an incentive to drink this would not be occurring. Therefore, a significant aspect of the decline in pubs and pub sales is attributable to the overall decline in consumption of alcohol, rather than to the specific impact of cheap supermarket beers on pub consumption. Also, consumption of beer as a percentage of total consumption is declining overall. In 2001 beer represented (by volume) 69 percent of total alcohol consumption. In 2008 that figure had declined by eight percent. People are simply consuming less beer compared to other alcoholic beverages than they once did, and they are consuming less alcohol overall. Neither one of these nationwide changes can be attributed to cheap supermarket beer. Finally, even within the beer market tastes are changing. Historically, pubs have been associated with the sale of strongly, flavoured ( and in terms of alcohol content) local ales. (Watson, 1992) Increasingly, British beer drinkers are opting for less strongly flavoured lagers and lighter beers in terms of alcohol content. (CAMRA) Again, this shift in preferences impacts negatively on sales of the strong ales traditionally served by pubs. Conclusions Realizing the large differences in price between consumption of beer in a pub and that purchased in a supermarket it would be ridiculous to dismiss this price differential as a factor in the decline in beer consumption in pubs. This is only more true in the wake of the economic downturn. However it would be overly simplistic to suggest that this is the sole factor in declining sales in British pubs. Alcohol consumption overall, and beer consumption specifically, is declining nationwide. Consumer preferences are also shifting from the traditional ales featured in pubs to lighter tasting lagers. On another level pub prices may be artificially inflated, exacerbating the price differences between supermarket and beer for a reason not directly attributable to loss-leader sales of beer in supermarkets. Finally, and arguably most important, pubs as a social institution are declining in importance in British social and cultural life. Inevitably, this is accompanied by a decline in attendance, alcohol sales and, specifically, beer sales. Therefore, cheap supermarket beer is an important factor in the decline of the pub but it is definitely not the only factor and may not be the most important factor. Further, it would seem that the best way to determine the roots of the decline would be to interview pub patrons and former patrons and survey them as to their reasons for stopping attending pubs, attending pubs less frequently and purchasing less beer while they are there. Publicans and pubcos have been decidedly unsuccessful in addressing this decline. The opinion of GMB indicates that they are divided as to the causes and unable to lower rents, wages and other costs allowing them to initiate price competition. Most importantly, to try to address this issue entails trying to reverse significant social trends (decreasing alcohol consumption, changing tastes, population mobility and urbanization) that are beyond their control. Indeed, the shift to pubs offering take away food may actually be exacerbating the problem. Finally, CAMRAs campaigns to boost the image of strong ales and the British Beer & Pub Associations Save Our Pubs campaign have made little headway against these larger social forces. References British Beer & Pub Association. http://www.beerandpub.com/. Campaign for Real Ale (CAMRA). http://www.camra.org.uk/. Campaign for Real Ale (CAMRA).“Save Our Pubs”. http://www.camra.org.uk/page.aspx?o=294840. Clover, Charles. (January 10, 2010). “Save the pub or let it die? Its your shout” The Times. http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article6982324.ece. General, Municipal, Boilermakers and Allied Trade Union (GMB). http://www.gmb.org.uk/home.aspx. Goodley, Simon. (September 14, 2010). “GMB blames owners for decline in pub-going” The Guardian. http://www.guardian.co.uk/politics/2010/sep/14/gmb-union-pub-alcohol. “Leeds pub closure crisis: Saving the British boozer”. (November 25, 2010). Yorkshire Evening Post. http://www.yorkshireeveningpost.co.uk/features/Leeds-pub-closure-crisis-Saving.6639508.jp. Market and Business Development. (August, 2010). “Press Release: UK Public Houses Market Research Report”. http://www.mbdltd.co.uk/Press-Release/Pubs.htm. Marshall, Tyrone. November (25, 2010). “Burnley pub to become family homes”. Burnley Citizen. http://www.burnleycitizen.co.uk/news/8688425.Burnley_pub_to_become_family_homes/. Mid Suffolk Government. (February 2004) “Supplementary Planning Guidance: Retention of Shops, Post Offices and Public Houses in Villages”. http://www.midsuffolk.gov.uk/NR/rdonlyres/2DC5119A-AC81-4E31-89EE-1A8603713C3D/0/SupplementaryPlanningGuidanceRetentionofShopsPostOffices.pdf. Pratten, John D. (2007) "The development of the UK public house: Part 2: signs of change to the UK public house 1959-1989", International Journal of Contemporary Hospitality Management, 19: (6), 513 - 519 Pratten, John D. and Chris Lovatt. (February 1, 2002). “Rural pub futures: John Pratten looks at the future of the rural pub and at licensees attempts to reverse declining trade”. Town and Country Planning. http://www.allbusiness.com/professional-scientific/architectural-engineering-related/183008-1.html. “Supermarket beer cheaper than water”. (November 12, 2010). The Telegraph. http://www.telegraph.co.uk/news/uknews/1569063/Supermarket-beer-cheaper-than-water.html. Supermarket Special Offers. “Beer and Wine”. http://www.supermarketspecialoffers.com/BeerandDrinkOffers.aspx. TopNews Network. (June 12, 2010). “Fuller Reports 17% Rise in Profits”. http://topnews.co.uk/26479-fuller-reports-17-rise-profits. TopNews Network. (August 25, 2010). “Punchs Managed Pubs See a Boost in Sales”. http://topnews.co.uk/211652-punchs-managed-pubs-see-boost-sales. Walton, John. (1992) Fish and Chips and the British Working Class, 1870-1940. London: Leicester University Press. Read More