SAB welcomes further easing of alcohol trade restrictions after losing R36 billion in revenue

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Having already lost R36 billion due to the three costly liquor bans, SA Breweries has welcomed the lifting of the alcohol trade restrictions.
Having already lost R36 billion due to the three costly liquor bans, SA Breweries has welcomed the lifting of the alcohol trade restrictions.
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  • With the liquor industry already lost R36 billion due to the three costly liquor bans, SA Breweries has welcomed the lifting of the alcohol trade restrictions.
  • The sale of alcohol is now permitted according to normal licence provisions under Covid-19 alert level 1; however, no alcohol may be sold during the hours of curfew, which are in affect between midnight and 04:00.
  • In the Eastern Cape, an association of 3 000 tavern owners is lobbying the Eastern Cape government and Liquor Board to freeze liquor licence renewals that come with charges.


With the liquor industry already having lost R36 billion due to the three costly liquor bans, a battered SA Breweries has welcomed the lifting of the alcohol trade restrictions.

The sale of alcohol is now permitted according to normal licence provisions under Covid-19 alert level 1; however, no alcohol may be sold during the hours of curfew, which are in effect between midnight and 04:00.

The lifting of the restrictions followed President Cyril Ramaphosa's announcement on Sunday that the country will move to Covid-19 alert level 1.

"SAB welcomes the president's announcement to move the country to level 1 of the national lockdown and officially reopen the sale of alcohol according to normal licence provisions. SAB has to put economic recovery first as the lingering impact of the lockdown starts to outweigh the physical impact of the virus. Trade has become essential and we are excited to play our part in this regard both for our employees and our national economy," the company said in a statement.

Celebrated lifting of ban responsibly

"We can all agree that the lifting of the ban should be celebrated, but let it be done responsibly. We maintain that our beers are to be enjoyed moderately and responsibly and therefore we do not condone reckless behaviour any kind, especially as we fight to contain the spread of this virus."

SAB said it lost 30% of its annual production in 2020 and, as a result, paused R5 billion in investments – a blow to the country's much-needed investment drive to kick-start an economy in the doldrums.

But the impact doesn't stop there, the brewers said. During the ban they were unable to renew the contracts of 550 workers, but have since reinstated 378 contracts after the lifting of the ban. All of its salaried employees took a pay cut.

SAB said in an industry commissioned report compiled by FTI Consulting released in February 2021, it indicated that with all three bans on alcohol sales, potential industry sales volume lost was 1.1 billion litres of finished product (equivalent to 24.1% of total industry sales for 2020 and projected sales for 2021 year-to-date (YTD).

The potential sales revenue lost is R36.3 billion (equivalent to 24.8% of total sales value for 2020 and project sales value for 2021 YTD). This is after accounting for a recovery in sales following the lifting of the ban, the brewery said.

Devastating effect on industry

"Under Covid-19 level 3, the sale of alcoholic products were restricted to between Monday and Thursdays between the hours of 10:00 and 18:00. Together with the three periods of alcohol bans, the last of which was lifted the first of February, these restrictions for the off-site sale of alcohol have had a devastating effect on the retail market and industry as a whole," says Gerrit van Loo, managing director of Heineken SA.

"We call on all South Africans to continue complying with the Covid-19 health and safety protocols. We also call on our consumers to enjoy alcohol responsibly and to observe social distancing at all times. Let's all play our part in slowing down the spread of Civid-19 and in helping our economy to recover, by ensuring we are responsible,” said Van Loo.

Freeze licence renewals

In the Eastern Cape, an association of 3 000 tavern owners is lobbying the Eastern Cape government and Liquor Board to freeze liquor licence renewal, which come with charges.

President of the Eastern Cape Liquor Forum, Winston Hector, said many traders won't be able to pay the R2 500 to renew licences due to the costly bans and hope for the best outcome.

Eastern Cape Finance, Economic Development, Environmental Affaires and Tourism spokesperson Phumelele Godongwana confirmed that officials of the department were scheduled to meet the tavern bosses late on Tuesday afternoon.

Hector said the lifting of the trade restrictions was a welcome relief.

'Absolutely, it came as a welcome relief and we are grateful to the government. The rebuilding of our businesses will take many years because of the devastating effects of the lockdown on taverns.

"Many are not able to trade and has lost their businesses whilst the majority are drowning in dept to municipal accounts, rental agreements, vehicle instalments, etc. The road ahead will be long and difficult."

*This story has been corrected to reflect that the R36 billion lost due to the three costly liquor bans was for the alcohol industry on the whole, and not only SA Breweries

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