Lower beer prices spreading to bars
The brewery industry has already passed on the savings from the elimination of the 20 per cent beer duty to supermarkets and convenience stores and is now working with bars and restaurants to adjust prices.
Members of the Hong Kong Beer Coalition started issuing new price lists after the government announced wine and beer duties would be abolished. The coalition represents about 80 per cent of the local beer market.
The savings translate into an average reduction of about 30 HK cents per small can of beer. Beer prices have fallen by an average 3.3 per cent at ParknShop and 5 per cent at Wellcome.
'Working out the price adjustment for bars, restaurants and other [in-house consumers] is harder,' said coalition chairman Steven Co, a senior manager at San Miguel Brewery Hong Kong. 'They don't buy one can. They place large bulk orders so they get bigger discounts.'
El Grande, which operates bars and restaurants including Central's Brew House and East End Brewery in Quarry Bay, has received new price lists from some suppliers and will start lowering prices in the next few weeks.
Rhys Adams, El Grande's marketing director, said beer prices were cut by HK$2 to HK$3 last year, when the duty was halved to 20 per cent. He expected similar reductions this year.
El Grande outlets normally charge between HK$40 and HK$50 for a beer.
Lan Kwai Fong beer prices have already been cut by between 4 and 5 per cent.
But prices will only drop permanently if savings from the cut in duty are passed on by everyone in the supply chain, something the coalition has no way of enforcing.
The coalition had wanted beer duties to remain unchanged in 2008-09 because more time was needed to evaluate the social and economic effects of last year's cut in beer duties to 20 per cent from 40 per cent.
