The banning of the world’s largest beer brand, Anheuser-Busch InBev has been the hot and rising issue for all the restauranteurs in Delhi. The government has banned the selling of these beer products in the city for a time period of three years, for allegedly evading local taxes. Since beers from AB InBev had a huge share of sales in the capital city, the beer ban has left restaurant owners just as disappointed as the beer lovers.
AB InBev, that includes popular beer brands like Budweiser, Hoegaarden and Stella Artois, is the second-biggest player in India. The brand is worth $7 billion of the beer market and a 17.5% market share, according to research from IWSR Drinks Market Analysis.
Why Did The Beer Ban Happen?
At the end of last month, the city government followed a three-year investigation which found that the beer makes SABMiller- acquired by AB InBev in 2016 for around $100 billion. The company is accused of using duplicate barcodes on its beer bottles. The government said that these beer bottles were supplied to the retailers of the city, which allowed them to pay lower taxes.
In return, AB InBev issued a statement denying the entire allegation the Delhi Government has made on the company, saying that they would appeal against the order. In a subsequent order, the Delhi government said that AB InBev should be put on a blacklist for three years. This also leads to the sealing of two of the warehouses of AB InBev in Delhi.
The current dispute is centered around a random inspection at BarShala, a pub in New Delhi, on the night of Aug 16, 2016. The city officials said that they found 12 beer bottles of SABMiller brands at the bar whose barcode records showed that they should have been in the company warehouse at that time.
“A follow-on investigation showed that some beer bottles sent to the bar in November had identical barcodes to those found in the inspection in August,” the government official said. On the other hand, the bar argued that the discrepancy could be nothing but a technical issue.
The same barcodes were supplied more than one time at the bar, which is why it came into notice. “The same barcodes were supplied twice at the same restaurant and hence the discrepancy could be noticed. Had the same been supplied to a different retail outlet the discrepancy could not have been noticed easily,” the order said.
The Impact Of Delhi Beer Ban
With the ban on a major beer company, the sales of other beer brands are expected to shoot up. Since AB InBev was a big payer of the beer market in Delhi, restauranteurs would have to fill the gap caused, by bringing in more beer from other brands. There could also be a consumer demand shift to other kinds of alcoholic drinks, including wine or whiskey.
Taking advantage of the beer ban in Delhi, a lot of microbreweries from Gurugram are running multiple marketing campaigns to attract beer lovers into their bars. Since the beer ban is restricted to the boundaries of Delhi, people would be now pulled towards going to the NCR regions to pick their favorite beer.
One such campaign is being run by the Sandhouse Cafe in Gurugram, which is particularly posting about how they are offering Budweiser and Corona. The restaurant’s liquor sales are most likely to shoot up due to an increase in footfall. Similar strategies are coming up in all the bars around in Gurgaon.
Apart from an increase in beer sales in Delhi NCR regions, there is an upcoming trend of microbreweries in Delhi. The rise in the establishment of microbreweries in Delhi would lead to a vivid shift in the customers’ demands from normal beer to craft beer. Such changing customer demands would lead to an increase in the sales of craft beer.
How Restaurants In Delhi Are Coping With The Beer Ban
The beer ban in Delhi would not just be a setback for the brand but also the restaurants serving beer in Delhi. The major players serving liquor in the city are reporting an expected drop in their business. There would be a great level marketing required for enhancing sales of the restaurant once that our favorite beers are gone!
As soon as the news spread in town, there were multiple tweets from restauranteurs and customers around the city, opinionating about the issue. Many of the food bloggers and food enthusiasts talked about how restaurants would have a hard time rising up from the dent. Here are a few examples.
Quote Bar from Delhi pivoted the ban to their advantage and also lightened the mood by launching a campaign called “Ban Water” that introduces several offers on wine and other drinks in order to reminisce their favorite brand of beer. And also sustain the banning of their customers’ favorite beers by trying to focus on other drinks.
All in all, it is most likely that the restaurants would lose out on their beer sales as the major players are not in stock anymore. The good part, however, is that Delhi could finally see the rising trend of microbreweries on focus on craft beer instead! Although there are both happy and sad aspects of the ban in Delhi, both customers and restauranteurs are extremely sad about losing their favorite brand of beer!
