Foster’s keep prices affordable for kiwi 's
14 May 2004 News release
Foster’s keep prices affordable for kiwi beer drinkers
Foster’s Group NZ has announced its 2004 beer price increase will be around half that of its major competitors – a move set to bring a smile to kiwi beer drinkers who heard this week that both Lion Nathan and DB Breweries will raise package beer by an average 6.5 percent from June 1.
Foster’s Group NZ will raise the cost of its packaged beers (such as Crown Lager, VB, Foster’s Lager and Cascade) by 3.75 percent. The company’s tap beer will increase by 1.10 percent.
In another consumer-friendly move, Foster’s will delay the implementation of the new pricing structure until July 1.
The rise directly reflects the increase in New Zealand government excise tax of 1.55 percent and the higher purchase price Foster’s Group NZ will be charged when importing its beer.
“We made the decision several months ago to minimise any price increase as much as possible,” said Foster’s Group NZ Vice President Andrew Bonner. “We are very pleased to be able to keep the increase down to a minimal 3.75 percent. Although the new excise tax will be effective from June 1 we import all our beer, and therefore pay duty on product in advance, so we are able to delay the timing of the price rise until July 1.”
The decision not to match DB and Lion’s 6.5 percent increase is another example of how Foster’s operating approach, as a multi-beverage company, differs to other traditional breweries.
In 2002 when the average can size decreased from the industry standard size of 355mls to 330mls, Foster’s made the decision to increase its serve size to a generous 375mls. Drinkers now receive 14 percent more beer in a pack from Foster’s Group NZ than from other competitor brands that remain in a 330ml format. Mr Bonner says the retention of the larger-serve can and the 4.9 percent alcohol content of most of Foster’s beer products, translates into beer lovers being rewarded with premium beers that offer great value.
“We have very loyal drinkers and are always looking for ways in which we can repay and reflect that loyalty – ensuring Kiwi’s get a great tasting affordable beer is one way Foster’s can do that,” said Mr Bonner.
As a multi-beverage company Foster’s Group NZ markets and distributes a full-service portfolio of beer, wines, spirits, cider and non-alcoholic beverages. Price increases that reflect the excise tax increase on products such as wine, spirits and cider will be announced shortly but Mr Bonner says he expects they will be similarly conservative.