The alcohol ban in effect during lockdown has severely impacted the hospitality industry, and continues to wreak economic havoc since it was reinstated by president Cyril Ramaphosa.
Craft breweries are among the most hard hit in the alcohol industry, with 63% of craft breweries and brewpubs that have indicated they had to retrench staff during May and June as a result of the limited trading restrictions.
Read: Nearly 90% of craft breweries face possible closure
The wine industry is also facing major challenges with 540 wineries having indicated that they were unable to meet 70% of their payroll obligations at the end of the month in June, according to Vinpro.
The alcohol ban could affect quality of wine.
Cliff Collard, CEO of the Wine of the Month Club, spoke to IOL about how the ban on sales is affecting the industry not only financially but will also negatively affect the quality of the product in the long term.
‘There are going to be job losses in the short-term. In the long term, if the ban is extended drastically there will be a large contraction in the number of producers we have. That then puts pressure on a lot of the farms who sell their grapes to independent producers, which will in turn lead to these farmers investing less in their vineyards. This will then affect the quality and future production,’ Collard said.
It’s not just the alcohol producers being affected by the ban, either. The marketing industry have lost clients, and so have event agencies.
‘Obviously, all events and activations in bars have been cancelled. That’s fine, we get that. But with the ban on the alcohol trade, so has everything else that we do for them,’ Emma King, managing director PR consultancy, the Friday Street Club, told the Daily Maverick.
‘Graphic design for promotional pieces, social media management, digital banners for e-commerce. And with that goes the revenue that we pass on to the smaller suppliers that work with us on these projects – printers, photographers, videographers, caterers, media outlets.’
Government cited the need for hospital beds due to COVID-19 as a reason for the alcohol ban, saying that many trauma cases and other hospitalised patients are a result of alcohol induced violence.
Stakeholders are rallying for a different approach to manage this problem. ‘A more targeted and nuanced approach is required, and the industry has appealed to the Government to enter into discussions on reasonable and viable alternatives,’ said South African liquor industry spokesperson, Sibani Mngadi, adding that the alcohol industry supports 22 500 labour-intensive firms in the country such as restaurants, hotels, wine estates.
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