Summer of suds promises heady returns

More beer, please! That's what the public wants when the weather turns hot. According to CDM Pekao analyst Bogna Sikorska, spring and summer account for 60-70% of the total volume of beer sales in Poland. And so far this year, Poles are drinking even more suds. "And it's cheap beer that's becoming more popular," Sikorska said. "It's connected with the economic slowdown and rising unemployment. "And the taste of this beer has nothing to do with it - it all depends on fashion and marketing." New figures show that the three biggest domestic beer producers, Grupa Żywiec, Kompania Piwowarska and Carlsberg Okocim, which share 85% of the market, sold about 965 million liters of beer in the first six months of 2002, an increase of about 4.6% against the same period last year. And of this trio, the brewers that look set to benefit the most from a long, hot summer are Heineken-controlled Grupa Żywiec (makers of Żywiec, Warka, EB and Leżajsk) and the South African Breweries-controlled Kompania Piwowarska (makers of Lech and Tyskie, plus others). Compared to the first six months of last year, Grupa Żywiec increased sales by 7% and Kompania Piwowarska by 6.9%. Together, Sikorska estimates they control about 70% of the market. "But I think the Żywiec market share is more sustainable, as Kompania Piwowarska's sales were boosted by World Cup-related advertising in the last two months," Sikorska said. "Żywiec has also introduced a new product, Tatra beer, aimed at the most cost-conscious customers, and has been pretty successful with it."

In June this year, Żywiec sold 87.5 million liters of beer, while Kompania Piwowarska came a close second with 84 million liters. Carlsberg Okocim has encountered the biggest problems in the group. Compared to the first six months of 2001, Sikorska calculates that sales declined by 4.9%. "Carlsberg Okocim seems to have no idea what to do with the declining sales," Sikorska said. "There is no permanent and persistent marketing concept - although they do have cheap beer that could be sold. And I think this marketing failure bodes ill for them. For the past three years, they have promoted a different brand each year. Carlsberg pumped money into Okocim and the company has consumed it with no market results." 'Tis the season To see how seasonal and price sensitive this industry is, it only takes a visit to the banks of the Wisła river where more than 70 bars have opened for the summer. To stop price-cutting wars, the traders have agreed to sell a standard 0.4-liter cup of beer for zł. 5, although promotional specials are used to entice customers. Poland's traditional drink, vodka, is not available. Piotr Cichoń has had a bar on the Wisła for the past three summers. The first time he set up business, there were 17 other bars. Last year there were 30, and this year, he says, there are more than twice that number. On a good Saturday night, Cichoń estimates that about 20,000 people visit the strip. During the week, up to 14,000 a night. "But so far this year sales are not so successful; I think because of the economy but mostly because of too much competition," he said. "There are more stalls here this year, so overall sales might be growing, but individually we are all getting less sales. "Also the weather is a big influence on sales," he added as he sat under the shade of one of the Carlsberg umbrellas provided free by his beer supplier, along with fridges, furniture, cups, beer mats and weekend karaoke machines.

Another round It was last week's hot and dry conditions that attracted young Varsovians, Łukasz, 21, Marta, 20 and Paulina, 20, down to the Wisła for a beer. "We come here quite often because it's the only place in Warsaw where they have this kind of a thing," Paulina said. They agreed that the cheap beer prices are definitely an enticement for them. "And I think that younger people are drinking more beer because it is cheaper than vodka," said Marta, who prefers Warka Strong because "it has extra alcohol and a sweeter taste." According to analyst Sikorska, Tyskie is the No. 1 brew with 16% of the market, followed by Żywiec with 10%, Warka with 10%, and Lech and Okocim with less than 10% each. Away from the riverbanks, outdoor summer bars are also common throughout the city. In Nowe Miasto, Mariola Juźwik manages restaurant Fret@Porter, which has a bar on the market square for summer. A recent evening event in the square saw the restaurant sell 20 30-liter barrels of beer. "Our beer sales are pretty much the same as last year - perhaps a little better," Juźwik said. "These restaurants are aimed at foreigners, and there are plenty of tourists here who can afford good, expensive beer." Across town at Patricks, which has an outdoor bar on ulica Marszałkowska, poor sales show that away from the analyst's office, it's not all beer and skittles out there in the real world. "Sales are bad," said the bar's manager, who declined to give his name. "We have a crisis and sales are down 65% compared to last year. People have stopped going out and spending money. Usually we are able to make about 40-50% of our total annual turnover in the three months of summer, but I doubt if it is the same this year." He said that last year's ad ban, which limits beer advertising to late-night TV slots or inside magazines has had little influence on the amount that people drink. In fact, beer drinking continues to outpace vodka. "We don't get to sell much 'high-voltage' drink nowadays," the manager said. "But there has been a general drop in sales of all brands of beer."