Despite shrinking income, beer parlour business booms

Despite shrinking income, beer parlour business booms

Business Hallmark

By Adebayo Obajemu

Economic crisis has always been a booster for increased drinking habit. Both psychologists and sociologists believe that times of economic down turn and personal failures have provided motivation to take to the bottle.

This seems to be the situation in the country today as many Nigerians defy the current economic hardship caused by the collapse in the value of the naira which has triggered spiral inflation in basic household goods and services, leaving many families in despair.

At Madam Bose drinking joint in a lowdown area of Ijoko, Bose, popularly called “The Caretaker” by her admirers, sat on a big chair chuckling to herself, as she listened to her friend’s gist, occasionally casting a satisfactory glance at the horde of revelers guzzling down assortment of drinks according to individuals’ preferences in the joint she set up in December 2019.

In spite of the economic crunch, many of the beer-guzzling Nigerians have managed to, as one of them told Business Hallmark “keep their sanity through daily immersion in booze and more booze, to kill or at most drown away their sorrow, misery and nagging of their wives.”

As madam Bose once again surveyed the crowd of mostly men sitting around and having a nice time over drinks, she couldn’t help but pinch herself to be sure it was not a dream or illusion.

The boom in beer parlour business, which is considered the poor cousin of the sports bars, lounges and exclusive clubs in the entertainment/leisure industry family is against what the pundits are saying, going by the crowd, in spite of growing low incomes of households.

Beer parlours as we have come to know them are the most prolific business in most parts of Nigeria. Known for their staying power and low initial capital base, they are a study in how general inflation and harsh economic environment does not seem to affect certain businesses.

The typical beer parlour is a single entrepreneur-owned business with not more than two staff assisting with chilling, preparing and serving customers. The business premises is mostly the front area of a building to which minimal rent is paid and, in the beginning, the owner buys a few crates of alcoholic beverage and restocks as they are consumed.

Over time, he/she is able to calculate the reorder level and with time also opens a line of credit with his/her suppliers who are mostly wholesalers.

Keeping the operating expenses low and reasonable is critical to the long-term survival of the business and innovations are only adopted as the business increases in size and profitability.

For most patrons, the ‘pump price mindset’ is the key reason they patronize beer parlours. The ‘pump price’ refers to the drinks being sold at prices equal to or very similar to the recommended retail price from the manufacturers/breweries.
Unlike the lounges and sports bars, no premium is placed on the cost of the mostly alcoholic beverages being sold there. This allows patrons to maximise their ‘enjoyment’ within budget and creates room for them to splurge on other offerings.

The other offerings including fried meat, pepper soup (fish, goat meat, cow leg) are also on offer at very low prices. This creates a complete package in the minds of the patrons and increases patronage. A smart mallam can also place his suya stand beside the beer parlour and this becomes an additional offering to the patrons and also, assured patronage to the mallam.

Another key aspect of the beer parlour is the democratization of the public space that allows any person of legal age to not only sit down and consume alcohol and other offerings, but also to freely engage in public discourse, share ideas and in some cases, pretend to be an expert in a particular field of knowledge.

In this space, the discourse is not limited or moderated and information seemingly gathered in private is shared with glee to impress other patrons.

“I love coming to beer parlour than sitting at home. Here, you gain knowledge through discussions with others. If you want to witness democracy,come here, people of different classes and age brackets discuss freely”, a 65 year-old man who identified himself as Sikiru told BusinessHallmark at Bose joint.

Madam Bose told this medium that she opened her business two months before the Federal Government imposed a strict lockdown on three states including Ogun where she operates, but in spite of this her business did not suffer any adverse effects and in fact, appeared to thrive during the lockdown.

As a people, alcohol and its consumption play a critical role in almost everything we do. So, her establishment was a source of relief especially in the evenings for most people to ease the tension of being locked up at home all day. While most businesses experienced a downward spiral in patronage and profits around this period, businesses such as hers experienced a noticeable boom.
“In fact, it is clear that people, especially men cannot do without drinks and women. They always come to while away times in booze and thereafter women. Though they complain that the economy is bad but still come”, she said.
On why beer parlours appear impervious to the vagaries in the economy.

Professor Abdullahi Ohiare, a sociologist told BusinessHallmark that, “Beside being alive, men seek happiness, and in a depressed or depressing conditions, they seek an elixir, an avenue to forget those things that make them sad, they go out in search of a sense of community.”

As Ohiaresaid, the explanation may go beyond what people like Madam Bose offers- which is not just the alcoholic beverages and other offerings; but also, a sense of community.

“We drink when we are happy and drink when we are sad; all emotions that are enjoyed/endured together as a group”, Sikiru said.

At another location, Nnamdi Resort, a beer parlour joint along Akute- Ishaga road, for the teeming revelers last Saturday, life could not have been better, as they rolled and dazzled other people less endowed with dancing skills, as they gyrated to the music of Oliver de Coque, the late Ogene maestro.

Amid the frenzy and dancing, 28-year-old Rowland Eke sat on a deserted table, alone, fondling his smartphone.
The beer-loving young man, who identified himself as computer programmer had taken three bottles of Heneiken for the night. He was on the verge of emptying the content of the fourth one when our correspondent nestled to him.

Chuckling in satisfaction for conquering three bottles, as he glanced into his half-filled glass, he stated that despite the economic recession, nothing had changed in the booze world.

“What do you expect, so because of Buhari and this nightmare called insecurity and mess our economy has become, we Nigerians should go and commit suicide? No, a lot of us with sense will rather seek happiness. This is my happiness”, he said.

Nigeria, Africa’s largest economy, is in deep economic mess largely due to a fall in global oil price and mismanagement of the economy by past governments, and worst of all this clueless current administration.

Petty trader, Olabisi told this medium that she occasionally takes to the bottles to erase her worries.

“I may be thinking about something or bothered but once I start drinking, I take it off my mind. I’m a single mom, and when I think of what I go through selling soft drinks in scorching sun in traffic, it is sickening. But I have to provide for my daughter. I may return to the worry the next day but for that moment, I forget all worries,’’ she said gulping a glass of beer.

As BH surveyed joints after joints, it was discovered that the kind of drinks taken by individuals reflected their backgrounds, though this observation is not cast in stone. Nigerians love beer. That is why bar/beer parlour businesses rarely fail in Nigeria if the entrepreneur scouts his location properly.

While a lot of Nigerians also drink to drown their problems, drinking will never be a coping mechanism for problems, but Nigerians still drink.The beer consumption tide in Nigeria is uncertain. No brand is ever at the top for more than 10–15 years and brands know that.

To avoid going obsolete with one brand, they spread their tentacles across other brands which cover people and locations that their major brands would mostly not cover, so transition is easy.

Brands like Heineken are not moving with the major Nigerian market in Nigeria — lower middle class to lower class — because they are more expensive. Aside that, there’s a reason why Liquor, Spirits, Liqueur and other types of drinks don’t sell like beer in Nigeria. It’s about affordability and the lager taste.

The most successful beer brands in Nigeria have prices mostly ranging from N100-N200. Success and general acceptability are not just about your quality, it’s about who drinks you.
If the ‘Mekunu’ — lower middle class, to lower class — accept you, then you have a really good chance.

However, geopolitical zones also have a preference when it comes to beer brands.A particular brand might be more successful in a particular zone than another zone or a particular state than another state.

Goldberg is drunk across Nigeria for reasons nobody understands. Other brands like Star and Gulder are household names that still get loyalty from consumers.

Orijin and Heineken mostly appeal to richer Nigerians who can afford to spend N300 on their favourite brands, but they are definitely not more consumed in one zone than another zone.

Satzenbrau’s rebrand makes it really cheap and accessible, thus it has become popular across Nigeria. Guinness Stout is another legacy brand that enjoys a lot of loyalty.
Nonetheless, Guinness might enjoy more loyalty in the South-West and the South-East.

South West: Trophy, 33 and Legend

These beer brands are consumed more in Nigeria than elsewhere, and some of these breweries are closer to the South West. Aside that, success breeds imitation and some of these brands gain power from communal consumption.

Trophy might be derogatorily termed, ‘Oti carpenter or bricklayer’ which roughly means the beer for carpenters or bricklayers, but bankers and other professionals also drink them so it doesn’t matter.

South-East: Hero and Life

Hero is made by Intafact industries in Anambra State while Life is made by Nigerian Breweries targeted at the South-Eastern market and it is moving.

It is rumoured that Hero is more than just a drink for the Igbo because of certain unconfirmed BIAFRA symbolisms on its bottle. Whatever it is, this beer brand is moving in the South-East.

South-South: Champion

Champion beer is made in Uyo, AkwaIbom State. Its popularity in Akwa Ibom and certain parts of the South-South is no surprise.

Lagos:

In Lagos, all the brands move in Lagos, but lately, Trophy, perhaps because of its cheap price has taken over the market though with stiff challenge from other brands

This article originally appeared in Business Hallmark

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