One of the measures promised by our new government is the banning of the sale of alcohol below cost. This is excellent news, and not just for the 'health' measures being talked about by the media. Whilst people focus on the binge drinking aspect there is actually another aspect not being considered - and that is the buisness side.
The sale of below cost alcohol is a buisness practice engaged in by the UK's major super markets designed to entice people into their shops to buy eveything but the alcohol. They may loose of the sale from the 24 pack but they win overall by charging extra for the things you buy with it, particularly over priced grocery items and of course on things like BBQ's and the food you cook with them.
You may rememmber the off licence chain Threshers (aka First Quench Trading). A perfect example of a British buisness effectively destroyed by the 4 major supermarkets (Tesco, Sainsburts, Asda, Morrisons) quest for greater shares of the market. A company like Threshers could not afford to compete on beer prices and even with 3 for 2 on wine and much wine focus and training for it's staff it of course eventually lost out to the cheaper brands offered by he supermarkets, and sadly fell into administration in October 2009.
Individual independent buissnes's of course struggle as well to compete. For example a small newsagent simply can't afford to sell alcohol at less than cost, thats just not financially viable. It is getting harder and harder for them to compete with the giant shops and thats unacceptable if we wish to give the consumer choice and stop small buissness closures. We can't allow the whole country just to become 4 shops. And of course shops selling food and such are effected as well as potential customers end up doing all their shopping at the supermarkets, enticed by the alcohol offers and falling into the supermarkets trap and buying more whilst there. These big supermarkets have specialised marketing people working all year round with the aim of maxamsing profits and persudaing people to buy as much as possiable whilst in store - how can your local independent grocery shop owner compete with this?
Then of course there is the pub/bar trade. With the football world cup this summer you would expect a buisness sector like this to be booming and looking forward to it with great expoectation. Instead you see worry about these supermarket beer offers danaging trade and concern over a fall in sales figures. Pubs can't compete with the supermarkets on alcohol prices, and it is damaging to the pub trade to continue to allow below cost selling. People simply aren't going out to socialise when the supermarkets offer alcohol at a much lower price.
We can't allow supermarkets to continue to threaten other British buisness's by allowing them to continue selling alcohol below cost price. The government is right on this. Lets hope they pull through and deliver this promise.