Thursday, November 29, 2012

Lies, Damned Lies and Statistics...

There’s plenty of chat around about what might happen in next week’s budget. In fact, most of us are pretty much fed up with hearing about it. Plenty of things have been well flagged, including a likely increase in Excise Duty. Much like our attitude to the whole austerity fog that we are all lost in, we seem to accept these impending changes with little more than a benign resignation.

So for example, instead of jumping up and down about key issues like below cost selling of alcohol (how difficult can that actually be to introduce?), we’re all expecting an increase in Excise Duty next week of around 50 cents per bottle with a “well, it could be worse attitude”. Sorry, but how much worse?

I’ve heard of politicians “kite flying” ideas by leaking crazy ideas to convenient contacts in the press, and then sitting back to see how a madcap scheme pans out. Well, whoever it was that flew the idea of an Excise increase “only for the retail trade” idea in the weekend papers, please stand up. If there was ever a more ridiculous idea, I have yet to have the pleasure of stumbling across it. This proposal was explained with the assured logic that by not increasing Excise on pub sales, we would project jobs.

Now, I’m not an economist or statistician – but I do know where we wholesale our wines. And let’s see… that would include both pubs and retailers. So along with re-printing all our price lists, incurring the wrath of all our customers, endless whinging about how we can’t take it any more and so on, we’re now also going to have two different invoice systems. And as for our Bond, I pity them trying to determine if Bould Betty’s is a pub, bistro or lap dancing club when they release the wine from Bond and allocate the Excise Duty.

Seriously – whoever thought of that idea should quietly slip out that back door of Government buildings and think of a new career…..

So what about the statistics? Well, rather conveniently, the boffins at the Wine Institute in California have been checking bottle banks all over the world and have just published the latest world rankings for wine consumption. And not just for 2010, but very interestingly for the past three years. So from our Celtic Tiger peak in 2007 to the rather more austere days of 2010, you’ll note that wine consumption in Ireland has dropped by 8.3% to 16.89 litres per annum per head. Not a catastrophic drop – but not exactly a growing market ripe for an increase in tax.

More interesting is the drop from 2007 to 2008 – a whopping 25% drop. I don’t have the burning passion to go back over previous Budgets, but I’d guess that those figures overlap with the catastrophic rise in Excise Duty some years back that coincided with us all rushing up North to buy all our drink. If sales fell here, you can be sure the tax take fell too – and funnily enough, that Excise hike was subsequently reversed.

So in a market of falling sales, what makes best sense – increase the price of the product (when it’s still going to be available for less close by), or decrease/hold the price?


Aside from my rant, there are some great figures in the report. How about the fact that those in the Vatican City consume more wine per head than ANYWHERE in the world – a whopping 70 litres per head in 2009? That’s almost 5 times what we drink!

And Kuwait, where it looks (surprisingly) like the average is about a glass of wine per person, per year, managed to register an increase of 389%!

You can see the complete list here: Per Capita Wine Consumption by Country

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