MUP Update - Initial fears failed to materialise

Scottish c-store retailer fears that the introduction of Minimum Unit Pricing (MUP) in May 2018 would negatively affect alcohol sales in their stores failed to materialise. In fact, alcohol sales in Scottish independent c-stores are going from strength to strength: value sales during the first eight months of MUP (including Christmas trade, May – December 2018) increased by 15.1% vs the period in 2017. Alcohol share in overall c-store turnover increased too – from 14% in 2017 to 16% in 2018.

Although we are still within the first year of MUP being implemented, there are already some notable emerging trends in alcohol purchases in independent c-stores in Scotland. Beer increased its value share within Alcohol by 1.6% in May – December 2018 vs the same period last year (although this could be the consequence of the wonderful weather last summer & the World Cup). RTD/High Strength Premixes increased pack volume (number of bottles, cans, multi-packs sold) share by +1.7%. Cider was affected more than other Alcohol categories: pack volume declined by -8% vs the same point last year. However, cider products still contributed 17.6% of alcohol pack volume sales in c-stores, only down -3.4% to the same period last year.

Wine and Spirits Y-on-Y value sales grew at a below average rate in May – December 2018 (14.4% and 13.9% respectively) and both categories saw a slight decline in their relative category share within Alcohol compared to the same period in the previous year. C-store shoppers spent more on fortified wine and vermouth and premium vodka than in the same period in 2017. Value sales of Gin nearly doubled (+92%) year on year, which is in line with the overall UK trend.

Being able to compete on a par with supermarkets and offer added convenience such as chilled beer, RTDs and cider, c-stores in Scotland (and in Wales from summer 2019) are well placed to benefit from alcohol sales and provide a growing and exciting channel for suppliers.