As part of our annual Trends Report, Drinks Retailing polled independent retailers from across the UK. We had around 30 responses, covering more than 50 outlets and online retailers across beer, wine and spirits.
Some 65% of those surveyed say their business performed better in 2022 than it did the year prior, and 73% expect turnover to improve this year. That’s not to say our retailers aren’t mindful of headwinds – and 46% cite inflation and the cost of living crisis as factors that continue to impact their businesses.
Elsewhere, Brexit, general operating costs and energy prices all get a mention, by just over 10% each. Strikes, packaging costs and changing drinking habits also garner attention, as well as a lack of consumer confidence and the search for bargain options. While there is no denying these headwinds will impact retailers over the coming months, there is also some optimism as challenges become opportunities.
Take ‘changing drinking habits’, for example. If we look at the results for biggest growth areas, just over 23% of our retailers say the low and no alcohol category has potential. And in terms of ‘bargain options’, there’s another way to look at that, too: 11.5% of retailers say ‘good value alternatives’ is an important growth area.
Sustainability is a key factor, according to our respondents, and just over 15% say this is a big opportunity. Digging into wine and spirits, mezcal and tequila get the most mentions in terms of potential – by almost 20% of repondents. Both rum and flavoured vodka get a nod with 7.7% each.
In wine, organic and low-intervention tie with English wine at just over 15% each, while orange wine is highlighted by 11.5% of retailers. Italian and Eastern European wine are exciting prospects for a couple of our retailers, which chimes with the general mood to champion new discoveries and value for money.
As the gin boom slows and other categories gain traction, 2023 looks to be a year of big developments in the spirits industry. And for the majority of retailers we spoke to, whisky was the word. Half of the retailers we polled cited whisky as their bestselling spirits category, with Scotch single malts being the most frequently mentioned style among respondents.
Gin was noted as the second most popular spirits category, despite a handful of retailers flagging concerns around the potential overcrowding of the gin market.
When it comes to up-and-coming spirits, tequila and other agave-based spirits were the talk of the trade, followed closely by rum. Around 40% of retailers said that tequila was gaining the most interest among customers in 2023, with Oxford Wine Co managing director John Chapman saying that the “world is opening up” to agave-based spirits.
Nick Larsson-Bell, spirits buyer for Harvey Nichols, also mentioned tequila as potentially one of the biggest areas of growth this year.
Across the board, flavoured spirits outside of the gin category garnered the attention of the retailers we surveyed. Master of Malt content manager Jess Williamson said the retailer expects flavoured spirits – particularly flavoured rum – to be big business in 2023. And with some retailers looking to shift their focus away from gin, Amit Puntambekar, of Drinks Retailing Awards 2022 finalist Ash’s Shop, said “flavoured vodka is one to focus on”.
In beer, both traditional and emerging styles seem to be thriving in independent retailers, with respondents mentioning everything from pilsner, stout and lager to flavoured beer and low/no options.
Among the retailers we spoke to, the current most popular style in beer was found to be IPA, with Hannah Ford, retail manager at Drinks Retailing Awards finalist Starmore Boss, saying that “classic styles” such as IPA and pale ales are catching the eyes of consumers. T
Turning to up-and-coming beer, there was one style leaving consumers with a taste for more: sour beer. Sour styles were cited as the sub-category gaining the most interest with consumers, with Bier Huis owner David Jones highlighting “fruited sour beers” as ones to watch. Fruit-flavoured beer in general followed closely behind sour beer, as the nation’s penchant for fruit cider seems to be trickling into the beer category.
However, locally produced beers were also noted as popular options with the retailers we polled, as consumers look to support local businesses and explore what the UK beer scene has to offer. Lower-abv beers also received multiple mentions, with both Bier Huis’s Jones and Elena O’Brien of O’Briens Bottle Shop noting this segment as one that is likely to be popular with consumers in the near future.
There is a big difference between the wine countries or regions that are most popular and the ones our retailers say are gaining more interest. France tops the pops with 46% of the votes in the most popular list – and the usual suspects of Bordeaux, Burgundy and Champagne are also singled out within France.
Both Italy (38.5%) and Spain (23%) get lots of mentions, while South Africa, Portugal and New Zealand gain a respectable 15% each. Moving over to what’s gaining both interest and sales, Portugal and England tie with 23% each. Meanwhile, Greece is the word for just over 15% of voters and both Georgia and South Africa are next in line.
Looking forward, Dan Farrell-Wright from Wickhams says areas offering good value will be important. “For example, Cava for better value than Prosecco, small villages like Gigondas or Lirac as better value than Châteuneuf-du-Pape, IGP Méditérranée rather than Provence, crémant rather than Champagne.”
When it comes to grapes, there are clear trends in terms of the most popular, while the picture is a little more disparate for grapes gaining interest. Malbec and Sauvignon Blanc tie in the top spot for most popular, with Pinot Noir and Chardonnay close behind. Cabernet Sauvignon and Tempranillo get a few mentions, but they are significantly behind the top four.
In terms of trending grapes, Viognier, Pinot Gris and Tannat are in the lead, closely followed by Riesling and Grenache. Perhaps unsurprisingly, given the mentions of places such as Italy, Portugal, Greece and Georgia, there are many mentions for indigenous varieties, including Assyrtiko, Saperavi and Touriga Nacional.