LETTER: Huge cost of alcohol bans
Loss of sales cost the alcohol industry about 30% of its opportunities in 2020
Just over a year ago none of us could have imagined just how dramatically our world would change. The arrival of Covid-19 in SA was met with an announcement by the national government that the country would be locked down from March 27 2020, initially for a period of 21 days. Businesses were closed, people were confined to their homes — many without any income — and alcohol and cigarette sales were banned.
It was a dark time for SA, and while most of us appreciated the fact that lockdown was protecting our health, we had no idea that the challenges we were facing, as individuals and businesses, would still exist a year later.
As we mark the one-year “anniversary” of that first day of SA’s hard lockdown, it’s a good time to look back at these challenges, especially the one that has had the most impact on our industry, our business and people, namely the alcohol bans.
The various alcohol sales restrictions have meant alcohol manufacturers, including Heineken SA, have lost a total of 19 weeks of sales and production over the past year. That’s almost five full months out of the last 12 that we were unable to generate an income, not to mention the huge impact of disrupted production and exports.
Research shows these bans cost the alcohol industry overall about 30% of its sales opportunities in 2020, worth an estimated R36.3bn. This cost the SA economy over R59bn and, perhaps most worrying of all, it placed over 200,000 jobs at risk. We were not insulated from these employment challenges and had to retrench some of our valued employees. This was obviously a difficult action to take, but it was unavoidable in the circumstances.
It has been a tough 12 months, and we have no way of knowing what further challenges await us in 2021. It is clear the virus is not going to disappear and we have to vaccinate ourselves out of this situation. But for the moment we celebrate being able to gradually return to the workplace.
Gerrit van Loo
MD, Heineken SA
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