Tesco calls time on cut-price booze

Tesco has seen the light, backing the government's promise to ban below-cost alcohol sales.

Last Updated: 06 Nov 2012

The supermarket giant has apparently found the anti-social and adverse health effects of booze to be such a concern to its customers that it'd even support the introduction of a minimum price for drink, an idea that's already been mooted in the Scottish Parliament.

It's a remarkable turnaround from Leahy's outfit, who've been happily selling 12 gallons of throwing lager for a fiver for years. It's especially surprising with the World Cup approaching. This event tends to bring out the worst in price wars between the supermarkets, who are all so keen to outdo each other in stealing a march among the hordes of home drinkers that beer winds up cheaper than water.

Tesco's stance is of course that it only competes in such potentially harmful shenanigans because everyone else does. And that if the government introduced controls then it wouldn't have to. But its damascene moment came after a survey found that nearly 70% of its customers thought excessive drinking was one of the most serious issues facing the country. Good to see people power having such an effect.

Of course, it helps that Tesco wouldn't be the one that suffers if the price goes up. It will of course be shrewd about retaining its mark-up, and while the sales may decline as a result of the higher prices, the margin it takes may well increase in cash terms. Supermarkets tend to be more than happy to share their pain with suppliers, and will usually just pass the impact down the chain.

It's certainly not the risk it looks. In terms of form, Tesco is the supermarket equivalent of the Brazil or Argentina national sides. And if you consider selling booze below-cost as a sneak tactic like tugging a striker's shirt to prevent him scoring, it won't be Tesco that's left picking the ball out the back of the net should the practice be banned.

Leahy has described the binge drinking issue as 'about basic decency and living in a civilised society: it’s not much fun, particularly if you are elderly, going out at night if you encounter a group of binge drinkers.' Then there's the health angle. The idea of a minimum price has been championed by the British Medical Association and other health organisations. But critics have said it'd be difficult to enforce, as retailers wouldn't be too keen to reveal details of their deals with suppliers.

As to whether it would make the blindest bit of difference on the socially disruptive side of booze is, however, anyone's guess. People will drink like a fish anyway. You only have to look at how much smokers are prepared to pay for a packet of fags to cast doubt on the idea that such a culturally-ingrained problem will disappear if the price goes up.

And that thought may not have escaped either Tesco or the government - they're saving society and earning a few quid at the same time. Now that's something to celebrate, surely.

In today's bulletin:
BA flies into more turbulence as it announces record losses
Obama 1, bankers O - Wall Street reform ahead
Tesco calls time on cut-price booze
Renault dans l'eau chaud over Zoé name
The great paywall debate: who's right?


Find this article useful?

Get more great articles like this in your inbox every lunchtime