Looming excise tax hike won’t dent sales of drinks

CEBU, Philippines — Sales of celebration drinks are seen to sustain its strong performance in the Philippines, despite the looming implementation of additional excise tax.

Future Trade International’s (FTI) chief marketing officer Yogi Ringler said the fondness of Filipinos to celebrate life especially on special occasions, or even on ordinary days pushed the sales of celebration drink products.

In a press conference to promote the South African wine brand Nederburg, Ringler warned that if the tax hike will be pursued, consumers should expect another round of price increases in wines, and spirit drinks.

The government expects around P161.3 billion in additional revenues once taxes from cigarettes and alcohol are raised beginning 2020 and another P177.6 billion the following year.

However, he said despite this looming price increases, Filipinos’ stable and improving buying power, and their love to celebrate, make wine business still profitable and growing.

“Filipinos love to drink in good and bad times. In celebration and no celebration,” he said.

Cebu specifically is growing faster compared to other markets in the country, he reported.

FTI is one of the country’s largest distributors of imported wines, spirit drinks, among others, chief market. It grows its import volume for wines by 10 to 12 percent every year, which translates to two million cases imported every year. One case carries 24 million wine bottles.

Sales performance of Nederburg in the Philippines for instance stood at 20 percent. Cebu’s growth is faster.

Nederburg’s wine maker Samuel Viljoen was in Cebu recently to further promote its brand’s presence here.

Viljoen expressed steong optimism of the brand’s high double-digit growth in the next few years because of Cebu’s growing middle-class and good number of wealthy market.

Nederburg is a south African wine established in 1791.

FTI is a distributor of wines and spirits beverages. It carries several brands from ready-to-drink, spirits, wines, and beer and cider segments, with 70 brands and 400 different products. (FREEMAN)