Rising Beer Prices: Krombacher and Veltins Set to Increase Costs onconsumers and the Hospitality Industry
Beverage conglomerates aim to hike beer costs
Get ready for a hit to your wallet, beer enthusiasts! Two of Germany's largest breweries, Krombacher and Veltins, have announced they'll be bumping up the prices for bottled and draft beer this fall. This rise won't just impact big-box retailers but bars and restaurants too. But don't despair, there's been a trend of promotional prices in stores to ease the blow.
Krombacher, Germany's top-selling beer brand according to "Inside" magazine, may initiate the price hike starting October 1, 2025. The Veltins brand, which follows closely, will follow suit starting October 16, 2025.
These price increases come against a backdrop of rising costs for raw materials and energy, which are causing ripples across various industries, including brewing. However, it remains unclear if other major breweries will follow suit or how much retail corporations will ultimately pass these increased costs onto consumers.
Not just beer, the soft drink brand Schweppes under Krombacher's umbrella will also see a price increase alongside beer. A spokesperson explained that these moves are aimed at balancing costs across the hospitality industry and retail alike.
As industry observers suggest, consumers have been benefiting from promotional prices in recent weeks. With major pilsner brands accounting for about two-thirds of bottled beer sales on promotion, the price gap between promotional and standard prices is likely to widen further with the new price increases from major beer producers.
With these anticipated price hikes, consumers may need to adjust their spending habits or opt for cheaper alternatives. On the other hand, bars and restaurants could face increased costs, potentially impacting their profit margins and sales. They might have to adapt their menus or pricing strategies to stay competitive.
Potential Reasons for Price Increases
- Inflation and General Cost Increases: Rising costs for raw materials, energy, and wages can force companies to increase their prices to maintain profit margins.
- Wage Increases: If wage increases fail to cover rising employer costs, companies might need to pass those costs onto consumers through product pricing.
- Market Competition and Demand: Krombacher and Veltins might perceive a stable or increasing demand for their products and decide to capitalize on market conditions by raising prices.
[1] https://www.handelsblatt.com/unser-land/deutschland/lohnsteigerungen-gegen-kostendruck-2023-letzte-konzess-im-employers-einkampf-/30823068.html
Source: ntv.de, lme/dpa
The manufacturing industry, specifically beer, is set to experience an increase in costs due to factors such as inflation, rising raw material prices, and energy expenses. This development, initiated by breweries like Krombacher and Veltins, may eventually impact not only retailers but also the hospitality business, as they attempt to balance costs and maintain profit margins.
