We’ve been seeing it all our lives. Bars that fill their terraces with umbrellas, napkin rings, tables, chairs, sideboards and other furniture that promotes beer brands. For decades this advertising support was a boon for business. Now the hospitality industry fears that it will become a poisoned gift. The reason: the new law on alcohol and minors promoted by the Government and which already has the endorsement of the Council of Ministers wants to snip that kind of promotion.
The locals calculate that the loss of that advertising support it will cost them millions.
Blow to the hospitality industry? That’s what seems to fear the sector as a result of the law promoted by the Government to prevent alcohol consumption among young people. Although the regulation has not yet been finalized, the group is already managing a study which warns that it will seriously affect the finances of bars, restaurants, cafes, pubs and other hospitality establishments in Spain.
The reason: the bill of Health seriously restricts any advertising sponsorship related to alcohol. And that is a problem for businesses that have been filling for years with awnings, tables, chairs, ashtrays, umbrellas, napkin holders, refrigerators and furniture in general on which beer brands are advertised.
What exactly does the standard say? He billwhich can be consulted in the official Congress bulletin and received in march The Government’s endorsement sets some limits on advertising in the sector. Its article 26 is clear about this:
“Any direct, indirect or covert form of commercial communication of alcoholic beverages is prohibited, or of products that imitate or simulate being one, or of non-alcoholic beverages that share their brand and differential features with those of alcoholic beverages, including the commercial name, corporate name, symbols or brands of the people or companies that produce said beverages, as well as their distributors when they are exclusively associated with alcoholic beverages on public roads, or places visible from them.”
Does it clarify anything else? Yes. The law differentiates between two types of spaces: the ‘most sensitive’ and the rest, where the advertising restriction will be somewhat more flexible.
“However, advertising limited to the trade name, corporate name and identifying brands or symbols of the producing companies may be permitted in a perimeter that is more than 150 linear meters from the access to educational centers that teach early childhood education, basic education, post-compulsory secondary education and elementary artistic education, health centers, social and socio-health services, parks and places for children’s leisure.”
How will it be applied? In the statement March in which it reports the approval of the Council of Ministers to the Bill, the Ministry of Health clarifies, however, that it will allow the advertising of fermented drinks with less than 0.5% alcohol. Mónica García’s team also points out that the veto will not be immediate: it will come into force twelve months after the publication of the law in the BOE and will not affect “those situations that already existed before that moment”, which suggests that it will not affect the furniture that already exists. A different thing is when it comes time to renew it.
Will it affect the sector that much? It seems so. At least that is what a Comprehensive Economic Analysis (AEI) report indicates. advance by The Economist. The analysis, prepared for the Spanish Hospitality and Brewery associations and which is having a notable impact, ensures that the loss of sponsorships from alcohol brands will be quite expensive for bars and restaurants.
To be more precise, AEI estimates that it will cost the sector up to 1.7 billion euros. The estimate is based on two figures: a direct cost of around 600 million euros and a drop in sales of between 1,080 and 1,680 million.
He AEI report It doesn’t stay there. It also warns that the measure will affect between 8,000 and 10,200 jobs and will be felt beyond bars and cafes, with a reduction in the contribution to the national GDP that it estimates between 900 and 1,176 million euros. The study also suggests that the money that alcohol manufacturers will stop investing in advertising furniture will probably be directed towards other channels, away from small hoteliers and their businesses.
Why this suspicion? Although Health has clarified that the measure would still take time to come into effect and will not affect “existing” facilities, the AEI report points out that its wording leaves little room for doubt: “In practice it implies the removal of logos, signs, chairs, tables, umbrellas or napkin rings with beer brands from thousands of bars and restaurants in the country.”
His estimate is completed with another from Hospitality of Spain that gives an idea of the scope of the measure. According to their data, of a total of 130,000 bars and cafes in the country, between 70 and 80% incorporate elements sponsored by breweries.
Will it affect everyone equally? “If approved, the new law will practically eliminate all this support, forcing the brand’s advertising to be withdrawn, which will have an estimated cost of 12,000 euros per store,” remark the study.
The penalty that could be felt especially strongly in areas of Spain where hoteliers work in smaller markets and with less room for maneuver. The Economist slide that about 20% of the municipalities that now have only one bar (235) could see their doors close.
Images | Guillaume Flament (Flickr) and Ccalm Film Festival-María del Mar López Morales (Flickr)
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