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Import substitution has gone through the bars

Against the backdrop of an increase in the price of imported alcohol up to two times, restaurateurs began to replace it with Russian alcohol, which has not risen in price so noticeably. Managers of establishments are cutting costs, as there are fewer consumers able to pay for drinks at the new cost. Although it is impossible to completely replace imported alcohol, it is possible to increase the share of Russian alcohol in cocktails.



The bar holding "Cider Group" (Do not disturb, "Vermuteria RE", Room # 5, etc.) completely switches to Russian alcohol from March 24, although until February 24 imported alcohol accounted for about 95% of the menu. This was told to Kommersant by the partner of the company Vasilisa Volkova. Other restaurateurs have similar plans. Evgeny Vagin, the head bartender of the Kotelnaya, says that he is already starting to select replacement positions.

President of the Federation of Restaurateurs and Hoteliers of Russia Igor Bukharov noted that now many restaurateurs replace imported alcohol with Russian.



The alcohol company Ladoga confirms that the demand for their lines of Barrister gins, Fowler’s and Highgarden whiskeys, Ligare bitters and liqueurs from bar managers has increased. Such a measure has become necessary for the restaurant market: it is necessary to curb the rise in prices for drinks for the end consumer and reduce the risk of supply disruptions from abroad, says Sergey Mironov, founder of Meat & Fish.

Nikita Fomkin, co-owner of Sur-Bar and Intelligentsia, specifies that prices for foreign spirits have doubled over the past three weeks, while prices for Russian ones have hardly changed. Ladoga says that selling prices for imported alcohol have increased by 60-100%, for Russian strong drinks - by 7%. The Luding Group and Roust claim that selling prices in rubles for imported alcohol have increased in line with the exchange rate. And Russian drinks added about 10% in price due to an increase in logistics costs and a rise in the price of ingredients and materials, Luding said.

According to Sergey Mironov, today any increase in expenses for restaurateurs becomes critical.

Prices are rising for all goods needed by establishments, but it is impossible to increase the cost of dishes to the same extent in the current conditions - this will lead to a decrease in the flow of visitors, he notes. After the outbreak of hostilities in Ukraine and a new wave of sanctions, traffic in Moscow restaurants decreased by up to 60% (see Kommersant on March 2).

Liquor producers raise prices

However, it is impossible to replace the entire foreign alcoholic assortment. For example, tequila is made on the basis of agave, and rum is made on cane sugar, and these products cannot be grown in the climatic conditions of Russia, notes Vasilisa Volkova. But beer, cognac, port wine, liquors and bitters of local production may well compete with foreign ones, she adds. As Sergei Mironov notes, Russian analogues are at least suitable for cocktails, where the replacement may be less noticeable to the consumer.

Andrey Ushakov, marketing director of Luding Group, predicts that against the backdrop of an increase in prices for strong drinks from Europe and the cessation of supplies from the United States, the demand from restaurateurs for the Russian alcoholic assortment will grow. Against this background, Luding has already begun preparations for the release of its brands of gins, bitters, vodka and cognacs on the basis of the Kolomna Wine and Cognac Factory, he says.

Demand for foreign alcohol, on the contrary, will decrease.

Given the drop in purchasing power, the number of guests who can afford to order foreign drinks at the new prices will become much smaller and restaurant orders will decrease, Igor Bukharov points out. Restaurateur Dmitry Levitsky (projects Riesling Boyz, Mermaid Sushi, etc.) notes that it is impossible to replace foreign strong alcohol with local ones even in cocktails, and therefore restaurateurs will look for a more budgetary foreign option or offer more vodka-based cocktails.
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