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Average cost of bottle of wine ‘to top £5’

The average price of a bottle of wine in the UK will go above £5 next year, new research carried out by Accolade Wines suggests.

At present the average cost of a bottle of wine sold in the UK off trade is £4.71, but tax rises will push it above the £5 mark, Accolade Wines says, adding, ‘since 2002, 80% of the rise in the price of wine can be atrributed to tax increases.’

The company, formed last year from Constellation Wines’ Australia, Europe and South Africa business, is for the first time publishing research it has been carrying out for five years.

It says the alcohol ‘duty escalator’ introduced by the last Labour government, under which alcohol duties are set to increase 2% above inflation until 2015, will mean wine tax rises of 7.2% for the next two years.

At the same time, Accolade says, we are entering a period ‘where demand may exceed supply’ due to low-yield vintages like 2011, grubbing up of vineyards and increased demand from Russia and its satellite countries and Asia.

‘This along with increased duty will create further pressure on prices,’ Accolade’s UK Report 2011 says,with the average price of a UK bottle hitting £5 by July 2012.

The over-£5 segment now has a 20% share of the market, although James Lousada, European commercial general manager, said ‘we cannot forget that the £4 and under sector is still 40% of the market. It is the consumer’s bread and butter.’

The research programme, called WineNation, is carried out by Accolade’s six-strong research team with Neilsen and other research bodies, amongst 40,000 UK consumers divided into eight consumer segments, such as ‘Newbies’, ‘Confident enthusiasts’ and ‘Routiners’.

According to Lousada, Accolade invests ‘over £1m a year’ in market research.

Written by Adam Lechmere

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