Alcohol consumers in Nigeria will be forced to spend more as the Nigerian Breweries (NB PLC) announced a price increase on all their products effective August 10, 2023.
The decision of the NB PLC was conveyed in a letter dated 1st August 2023.
The company cited the need to review prices due to the continued rise in input costs and the necessity to mitigate its impact.
“This is to inform you that we will review the prices of some of our SKUs effective Thursday 10th August 2023.”
The decision to raise prices is attributed to several factors that have put immense strain on the Fast-Moving Consumer Goods (FMCG) industry.
With inflation reaching 22.79% in June and the managed float of the forex market leading to the naira exchanging for as high as N869/$ at the I&E window last week Thursday, companies like NB PLC have faced significant challenges.
In their half-year financial results, NB PLC reported N70.6 billion in forex losses as of June 30, 2023. Coupled with rising production costs and the ever-increasing cost of raw materials, this has created a challenging financial environment for the brewing giant.
The overall slowdown of the Nigerian economy and currency devaluation have further impacted profitability across various industries, including brewing.
With the price increase set to take effect on August 10, 2023, consumers will inevitably feel the impact when purchasing their favourite beverages.
Already grappling with challenging economic conditions and stretched disposable incomes, consumers may find themselves compelled to cut back on their beer consumption or seek more affordable alternatives.
This shift in consumption patterns could potentially impact brand loyalty within the industry.