The stricter drink drive laws, which were introduced in Scotland almost six months ago (5th December 2014), have saved lives, with a 17% reduction in drink driving offences between January and March 2015*, but are putting pressure on rural businesses across the country, which could have cost the Scottish economy millions of pounds.
New research that we have conducted shows that hospitality businesses in Scotland are reporting a drop in alcohol sales of between 10% and a massive 90%, with some hit so hard they are considering staff redundancies to stay afloat or even closure.
The research also showed a clear difference between rural and city businesses, with city locations largely unaffected due to public transport and central locations, but some rural businesses have considered hiring their own transport for customers in order to keep their doors open.
Market data supplied by Matthew Clark, expert drinks supplier, has shown that in the 12 weeks following the change in legislation Scotland saw a reduction in the volume of liquor sales of over 2.8M litres and also an increase in soft drink sales of 11%.
With summer on the horizon, many businesses fear that this could be the worst tourist season in decades, with many thinking that tourists will favour the city centre so that they are in easy reach of bars and restaurants. The tourism and hospitality sector in Scotland is estimated to be worth £4.2billion, employing more than 218,000 people**, so any change in tourist behaviour and spending could hit the Scottish economy hard.
Tennant Hilditch, Director of Sales for Beacon, said:
“Just six months in, the research paints a gloomy picture for the hospitality industry in Scotland, and particularly those in rural locations. If the snapshot we have taken is reflective of the whole country with alcohol sales down as much as 90% in places then millions of pounds will have been wiped off the Scottish hospitality economy.
“We absolutely believe in safer Scottish roads, and since the changes were made in December we have been working really hard with our customers to help them diversify their offer, such as investing in their food and menus to cover the shortfall in the drop in alcohol sales. We are also providing our customers with access to breathalysers so guests can be confident before they return to the roads.”
Many businesses across Scotland are also reporting a key change in consumer behaviour, with most of the businesses Beacon surveyed reporting that consumers no longer drink at lunchtime, instead opting for a hot beverage, such as coffee, speciality tea, or a soft drink. In the evenings, those businesses with a strong food offering have seen stability with many diversifying their drink menus to include non-alcoholic beer and wine, as well as mocktails.
Stuart Hutton at Beacon customer, The Priory Hotel in Beauly, Inverness, commented:
“We are fortunate that a significant volume of our bar trade is local, but we’re still seeing a 5% drop in sales. The most significant change is in our restaurant with customers not choosing to have an alcoholic drink with their food. We have therefore had to introduce a courtesy ‘Dine & Wine Vehicle’ for our local guests to transport from their home to the hotel. Without this, I think sales would have dropped by more than 15%. Despite having to introduce this costly service, we still consider ourselves to be lucky, compared with other hotels - we know that many have been seriously affected by the change in legislation. I think the government should have offered more support and guidance to the hospitality industry in Scotland before the changes were introduced.”
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