British-Irish drinks giant Diageo is to raise its pint prices for the third time in just over a year. A rise of six cents in Ireland follows an initial rise of 12 cents in February 2023, with a further four cents added last July.
The price hike, which will mainly affect the Guinness, Rockshore, Carlsberg and Hop House 13 brands, is mostly due to increasing input costs affecting all the company's businesses across Ireland. These costs have been rising even though inflation and energy prices have fallen over the past few months.
In a letter to business customers, as reported by the Irish Examiner, the company said: "In order to offset this, we must pass on some of these additional costs to our customers. As a result, we are adjusting the list prices on our draught product range.
"This includes Guinness which will increase by the equivalent of €0.06 per pint or €5.28 per 50 litre keg.
"These changes will take effect from 15 April 2024 and deliveries made on or after this date will be charged at the new prices."
However, the company reassured suppliers that they would be free to set the retail prices of their own products.
What does Diageo's price increase mean for pubs?
Diageo's latest price increase announcement has been met with disappointment from pubs and others in the hospitality sector which is already dealing with significant cost hikes.
Pat Crotty, the CEO of Vintners Federation of Ireland (VFI), which represents pubs based outside of Dublin said in a statement: "The announcement by Diageo is not just disappointing, it's a critical hit to an industry on the brink. Publicans have been navigating a storm of rising costs, including the increase in minimum wage, additional mandatory sick days and the impending pension auto-enrolment scheme. This latest price hike is a blow they cannot afford.
"The government must come forward with support measures for the trade as the Increased Cost of Doing Business grant, while welcome, is not an adequate response. The VFI is calling for further supports to include a reduction in excise, a return to the 9% VAT rate for pubs serving food and a reduction in employer's Pay Related Social Insurance (PRSI). Publicans can't be expected to take all these hits without meaningful support."
Diageo recently revealed Sir John Manzoni as its new board chairman, taking over from Javier Ferran, who was retiring. Sir John was previously a non-executive director in the company.
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