At what is already a challenging time for the on-premise channel in the UK – with the country’s restaurants posting a 32% slump last year to a forecast GBP21.8bn (US$30.8bn) – the UK Government is set to ban free refills from fountains in restaurants from April 2022.
Although this promotes health & wellness to consumers, the move also places a further risk on soft drinks sales in the country’s on-premise.
“According to recent research by GlobalData, 50% of the UK population is ‘extremely’ or ‘somewhat’ concerned about their physical health and fitness,” says GlobalData beverages analyst Holly Inglis. “The Government’s move, which is designed to combat the excessive consumption of full-sugar drinks, should help to improve obesity rates improve while adhering to consumer sentiment towards healthier offerings.
“However, the new legislation also has the potential to adversely impact the sales of carbonated soft drinks in restaurants, which will hinder growth for brand owners.
GlobalData’s most recent survey in the UK highlights that 'convenience' (22%) and 'value for money' (15%) are two of the greatest benefits of restaurant-prepared food and drinks; both of which apply to free-refill beverages.”
Inglis continues: “Meanwhile, one in ten (10%) consumers also highlight that natural product claims are attractive, when it comes to their restaurant experience. This presents an opportunity for beverage brands on drinks fountains, going forward.
“Although CSD brand owners may see health & wellness as a sales hindrance, avenues remain open to help the top-line to grow, while also promoting healthier cues.