Inflationary burdens: Kirin to implement fourth round of price hikes in a year to cope with ‘difficult’ conditions
Kirin announced in January this year that a new round of price revisions are set to enter into force starting Wednesday, May 1 2024, which will affect relevant products that are packed into large plastic containers.
“In order to deliver safe, high-quality products at reasonable prices, our company has continued to strive for corporate efforts and streamlined management to improve productivity and reduce costs across our business,” Kirin Beverage President Toru Yoshimura said via a formal statement.
“However, prices of raw materials, containers and packaging materials, energy, logistics, and other related costs continue to soar, and the future is expected to remain uncertain and difficult.
“Due to this situation, we have decided to once again revise the prices of some product – [This will affect] some products such as large plastic bottle containers, and the price change rate will be by an additional 8% to 9%.”
This is by no means the first time Kirin as a company has had to resort to price hikes to deal with inflationary pressures – In November 2023, its brewery arm Kirin Brewery also announced that price hikes would be implemented for a number of alcoholic products, notably the Western spirits and RTD items it imports.
“Due to the continued impact of rising global transportation and raw material costs, the delivery price from the overseas brand owners to our company has changed,” Kirin Brewery President Hideki Horiguchi said via a separate statement.
“We have determined that it will be difficult to absorb the cost increase through corporate efforts alone, so we have no choice but to implement price revisions for some products.”
These price hikes will kick in on Friday March 1 2024, and will affect the Four Roses whiskeys which Kirin imports into Japan from the United States, as well as Smirnoff RTD vodka products such as Smirnoff Ice, Smirnoff Ice Wild Grape and Smirnoff Ice Brisk Lemonade.
Both Kirin Brewery and Kirin Beverage had respectively already previously hiked up prices for other several other products.
The former did this for imported products including Johnnie Walker Black Label whiskey and Smirnoff vodka, as well as some locally-produced ones such as Kirin Ichiban Shibori draft beer, Kirin Tanrei Green Label Lower Sugar beer, Kirin Tanrei Gokujo draft happoshu, Kirin Nodogoshi Nama new-genre, and various barrel-packaged products, all of which saw higher prices from October last year.
Kirin Beverage on the other hand implemented price hikes on the majority of its products packaged in canned or pouched format since May last year, with these increases being as much as 19% to 23% - affected products that fall under the purview of this arm include non-alcoholic beverages and end-products under the iMuse functional brand.
Not price hikes alone
On a positive note, the company is not looking solely at product price hikes to overcome the impacts of inflation, but has plans to handle the situation using other strategies as well.
“We will continue to take aggressive measures in each category to capture the changing demands of our consumers [and] are working to strengthen our brand portfolio,” Kirin Senior Executive Officer and General Manager of Corporate Strategy Hiroaki Takaoka told the floor a recent last investor’s meeting.
“Kirin will also continue to strive to improve management efficiency through corporate efforts [in order to combat current challenges], and strive to deliver safe, high-quality products to our consumers.”
