South Africa’s food and beverages sector lost 0.3% of its income in May compared with a year earlier, Statistics SA data released Thursday showed. Coffee shops did as much damage to that number as full-service restaurants, and in a market where beer, coffee and soft drinks depend heavily on people ordering out, that’s a drinks story as much as a hospitality one.
The month-to-month numbers bounce around. Seasonally adjusted income rose 3.6% in May against April, following a 3.6% drop in April and a smaller dip in March. Strip that noise out and the three months to May are still down 0.2% year on year, dragged by the same two categories: restaurants and coffee shops.
Brewers are already seeing the shift at the till. SAB‘s first-quarter results showed beer volumes lagging even as its Beyond Beer lineup, the group’s non-beer and low-alcohol portfolio, grew faster, a sign that drinkers are swapping rather than simply cutting back. The Drinks Federation South Africa still counts the alcohol industry as a R226.3bn contributor to GDP, but that scale doesn’t shield individual categories from a change in what people order.
Coffee is being squeezed from both sides. Non-alcoholic beverage inflation ticked up to 4.9% in May from 4.6% in April, even as food inflation eased elsewhere, meaning a takeaway coffee or bottled soft drink got relatively pricier just as fewer people were buying one.
Real take-home pay explains why. It fell to its lowest point in roughly two years in June, even as nominal salaries edged up, and a drink bought on the way out is one of the easiest lines to cut from a stretched budget.
The same substitution is playing out across the continent, where brands are defending the occasion rather than the price. Drinkabl.media has tracked South Africa’s own shift toward non-alcoholic beer and cider, and Harar‘s laughter-for-beer campaign in Ethiopia runs on the same logic.
Stats SA publishes the June food and beverages figures in late August, around the same time SAB and its peers report half-year numbers. Whichever comes first will show whether the swap from beer to Beyond Beer, and from sit-down to takeaway, has further to run.
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