Monday, 10 March 2008

Cheeky or Correct?

I am indebted to the Morning Advertiser for this:

JD Wetherspoon founder Tim Martin has written to the Competition Commission objecting to Heineken’s takeover of Scottish & Newcastle. Martin argues that the move will see a serious reduction in competition and that he is worried by Heineken’s “attitude to price”. He complains that Heineken has refused to supply Amstel to his company because Wetherspoon wanted to sell it for £1.99 a pint. Martin says in his submission to the Competition Commission: “The number of brewers from whom publicans buy recognised and attractive lager products has dropped dramatically in recent years as the number of major brewers has contracted through takeovers.

“At the current time, in choosing a portfolio of lagers the main brewers from which publicans can choose are Scottish & Newcastle, Coors, Carlsberg and Heineken. “Although the first three companies have by far the biggest volumes in the UK, Heineken has viable alternative products and is pushing hard to get them established in British pubs. "Their pouring lager is Amstel (around 4% abv) and their premium lager is Heineken itself (5% abv). “We feel it is a very unhealthy situation if the selection of brewers from which publicans can choose is reduced in this way. “Our fears are exacerbated by the attitude of Heineken towards price. “We recently wished to add another pouring lager to our portfolio and sought to install Amstel in all our pubs with an initial selling price of £1.99. “However, Heineken refused to supply the product to us, since they wished to establish a 'premium' selling price for their product.”

Martin claims that a main motive for the Heineken takeover of S&N is to reduce the level of competition in the market and to push up prices to the licensed trade and, ultimately, to consumers.

“Heineken and Scottish & Newcastle, as separate companies, provide clear and distinct alternative sources of supply for publicans in Britain and this reduction in competition should not be permitted.”

Well what about that then? Timbo is undoubtedly right, but is he the right guy to say it?

6 comments:

Bushwhacker said...

Well, he is in a great position to know if it's true or not. It probably carries more weight coming from him than from most other people in the trade.

Tyson said...

I always find it funny when the proponents of the "free market" turn round and squeal about it. Of course, he's right, but I think there will be little sympathy in the trade for him, given his company's record.

The Beer Nut said...

He's clearly taking a leaf from the Michael O'Leary book of business PR.

The phrase in these parts is "a neck like a jockey's bollocks".

Stonch said...

Is he "undoubtedly right"? I'm not so sure.

I don't see why the anecdote he tells about Heineken not wanting their Amstel brand trashed by 'Spoons can be built up into some kind of conspiracy theory involving the S&N takeover.

In reality lots of foreign brewers are wary of their products appearing in Wetherspoons, as it tends to devalue them in the eyes of consumers.

Tandleman said...

Stonch

I meant thathe is right that competition will be reduced, not the Amstel bit. I should have made that clearer

Stonch said...

Ah ok. Well as you suggest in your post title, of course, Martin is a fine one to talk about competition!