How to deal with the alcohol ban on highways

That’s a clever workaround plan, literally. Following the ban on alcohol sales on and nearby highways as of 1 April 2017 in an effort to reduce road accidents, India’s hoteliers and restaurateurs ingeniously are trying various ways to increase the actual distance one would have to traverse to reach their premises. The methods involve changing entrances and building veritable mazes or zigzag passages to circumvent the ban.

Hotels will be hit hard by the ban as alcohol sales alone account for 10 to 30 percent of their total food and beverage revenue, according to a recent report. But the impact is expected to be higher, as the ban will also impact the revenue from meetings, incentives, conferences and exhibitions, as well as room demand.

State governments, which are set to lose out in excise revenues, acted in a flurry. Soon after the introduction of the ban, they began “re-designating” highways, calling them “urban roads” instead, thus allowing for alcohol sales to continue.

All this would have been brought to the notice of AB-InBev’s CEO Carlos Brito, who visited India four days after the ban came into effect.

While AB-InBev is the number two beer company in India behind United Breweries (51 percent market share), it has been losing market share to rivals including Carlsberg, which controls 17 percent. Its market share dropped to 19 percent from 24 percent in 2014, it was reported. The recent decision to ban alcohol on highway will further dampen its operations. Several of SABMiller’s warehouses and plants, especially in the north, which are located near highways, may have to be relocated.

AB-InBev was a fringe player in India until last year when it acquired SABMiller.