Sales growth as stores stock up on brewery beverages before tax rises

The domestic sales of member companies of the Federation of the Brewing and Soft Drinks Industry in 2013

A total of 778.6 million litres of brewery beverages were sold in 2013. Domestic sales of beer, cider, long drinks, mineral waters and soft drinks rose by 4.0 million litres, or 0.5 per cent. Sales saw growth as stores stocked up at the lower tax rate before the turn-of-year tax rises. These figures are based on sales statistics compiled by members of the Federation of the Brewing and Soft Drinks Industry.

According to breweries’ estimates, in December stores purchased almost 7 million litres more than usual at that time of the year. Without December’s purchases, total sales of brewery beverages would have decreased. The tax on both alcoholic beverages and soft drinks was raised at the beginning of 2014. Beer tax rose by 8.2 per cent and the tax on soft drinks containing sugar rose from 11 cents per litre to 22 cents per litre. Tax steering has clearly impacted on beer and soft drinks.

“The consumption of beverages was partly influenced by the general economic situation. The beverage industry has also been put under increasing pressure by stricter regulation. Booze cruises are gaining in popularity, while sales in Finland are falling. The advertisement of alcoholic beverages is now subject to even stricter regulation and taxes have been raised several times over the last few years, both on alcoholic beverages and soft drinks,” says Elina Ussa, Managing Director of the Federation of the Brewing and Soft Drinks Industry.

High taxes steer consumers towards Estonia. Finland’s beer tax is EUR 1.51 per litre on 4.7% alc/vol beer. In Estonia, the corresponding tax is only EUR 0.30 per litre. Travellers’ private imports are already notably higher than on-trade sales in Finland. According to breweries’ estimates, Finnish brands now account for only about half of all the beverages brought over from Estonia.

The Finnish brewing industry is downsizing its operations to adapt to higher taxes and increasing private imports. The brewing industry directly employs about 2,000 people in Finland. About 30 per cent of jobs in the industry have already disappeared since 2002.

Reduced revenue from alcohol taxation the result of failed alcohol policy

The Federation of the Brewing and Soft Drinks Industry demands an impact assessment of both the current situation and what should be done to develop a culture of responsible drinking. Finland’s failed alcohol policy has resulted in a dramatic rise in booze cruises and reduced revenue from alcohol taxation.

“Conducting business in Finland will be even more challenging if the proposed changes to the Alcohol Act are implemented. The government’s approach to refining drinking culture is thoroughly old fashioned – shorter sales hours and limitations on licensing hours. The proposed transfer of medium-strength beer from grocery stores to the State’s monopoly stores has sparked off much debate, yet has since proven to be against EU conventions,” says Ussa.

In 2013, a total of 395.2 million litres of beer were sold. This is almost the same amount as in the previous year – growth was only 0.9 per cent. Hartwall, Nokian Panimo, Olvi and Sinebrychoff sold a total of 38.8 million litres of long drinks and 30.2 million litres of cider. Long drink sales fell by 6.4 per cent and cider sales by 1.6 per cent. Sales of soft drinks remained stable. A total of 247.5 million litres were sold, representing growth of 0.1 per cent. 66.8 million litres of mineral waters were sold, a rise of 5.6 per cent.

DOMESTIC SALES 2013

Source: Member companies of the Federation of the Brewing and Soft Drinks Industry: Hartwall, Nokian Panimo, Olvi and Sinebrychoff. The statistics do not include sales by actors outside the Federation nor private imports of brewery products, which are not statistically recorded. As of the beginning of 2011, the statistics include all the brands of the members of the Federation of the Brewing and Soft Drinks Industry and any private label brands they produce.

Managing Director Elina Ussa, tel. +358 (0)45 269 7711
Communications Manager Outi Heikkinen, tel. +358 (0)50 370 8677