18TH JANUARY, 2022

Dry January fatigue? How innovation in non-alcoholic drinks is making it bearable

As we welcomed in 2022, many of us will have promised ourselves a dry January. Laying off the alcohol after a Christmas of over-indulgence, many of us vow to get healthier or shift a few pounds.

But while drying out one’s liver wasn’t too bad for a while, the novelty may well be starting to wear off. However, the good news is that over the years beverage companies have been pumping millions into innovative ways of making no or very low-alcohol drinks more authentic. So if you’re struggling with the dreaded “Janu-dry”, read on.

Alcohol-free options are actually pretty drinkable

Obviously his is down to personal taste and preference. But across Europe, consumers are diving into no or low-alcohol versions with gusto.

Spain is in fact the largest market for low-alcohol beer in Europe, with these products making up around 10% of overall beer sales. In fact, across the world no and low-alcohol drinks are growing fast in popularity, with the market expected to grow by 34% by 2024.

Even in the UK, a country that is known to enjoy a drink, British retailers saw sales of low or no alcohol spirits increase by 15% in the weeks running up to the first COVID-19 lockdown as many Brits reduced their drinking in the January and February of 2020.

Such an exponential growth in popularity means drinks brands are getting competitive, each trying to produce the most delicious and lifelike alternative to alcohol.

Tom Ward, Wise Bartender founder, says the addition of alcohol-free lines to many brand’s offerings has given the market a huge boost.

“There was a count [of the number of alcohol-free spirits], and there was about 300 available,” he said.

Cost however is a big hurdle to get over. “People don’t mind chancing it on an alcohol-free beer or wine for a few pounds,” Ward continued, “But spirits are a bit more expensive.” This makes people much more hesitant to fork out £20-odd on a bottle of alcohol-free wine they’ve not tried before.

So how do they make drinks taste good, minus the alcohol?

Non-alcoholic beer such as Becks Blue and Calibre make up a particularly huge section of the market. The drink itself is developed through partial or limited fermentation.

Many companies slash the brewing time by killing or removing the yeast early on to reduce fermentation. Some brewers will also ferment at low temperatures because this makes the yeast turn sugar into alcohol more slowly. However, this process still gives the beer its distinctive flavour by retaining molecules like longer-chain alcohols and esters.

Beer, wine and spirit manufacturers can also add in less sugar from the start of production, or give the yeast less of what it needs to ferment. For example, many producers of white wine add enzymes to juiced grapes when making no or low-alcohol versions. This transforms glucose into gluconic acid which yeast isn’t able to “digest”. Some manufacturers have even developed low-alcohol wine simply by diluting normal wine with fruit juice or water.

But it has to taste good, surely?

Of course, otherwise people won’t buy it! And that’s the crux of the challenge.

Non-alcoholic drinks producers are essentially trying to recreate nuanced, highly complex flavours using a broad range of flavourings, herbs, botanicals, seeds and nuts. Gin, for example, has exploded in popularity in recent years, bringing about a strong demand for low or no-alcohol options. Some are doing this with juniper berries (gin’s signature flavour!) whilst other companies are trying out new flavours.

Traditionally (and still commonly) drinks brands make a zero-alcohol version of their regular lines by simply separating out the ethanol during production. This can be done by applying heat. However, the danger is that heat can bring about the Maillard reaction, which can make drinks taste unpleasant. Instead, a modern approach is to use a vacuum to remove the alcohol at a lower temperature. Winemakers will frequently deploy ‘spinning cone columns’, where liquid flows over several alternating static and rotating cones. This then works to increase the surface area that alcohol can evaporate from. However, there’s no getting away from the fact that evaporation does require some heat, so many manufacturers use membranes to do reverse osmosis or dialysis, again at a low temperature.

The fact is that due to the distinct process of brewing, even ‘no-alcohol’ drinks will have tiny trace amounts of alcohol in them, (up to 0.05% ABV).

And what about the colour, we hear you ask.

Colour is just as important as taste when it comes to authenticity. Some drinks manufacturers add colouring to their products to make it more realistic. In beer this is typically caramel colouring, which is also commonly used in some foods, vinegars and also cola. No and low-alcohol wines and spirits will also have similar E-number colourings - both natural and artificial - to achieve the same effect.

The beverage sector is a huge claimer of lucrative R&D Tax Credits

The R&D Tax Credits scheme is a government tax incentive designed to encourage all business sectors to innovate. But with new concepts, flavours and product lines being launched all the time, it’s no wonder that claims can easily total tens of thousands.

If your company - however large or small - has recently undergone innovative research and development work then as much as 33% of the eligible costs could be reclaimed from HMRC. The rebate is given either as a reduction in Corporation Tax or as a cash lump for loss-making companies.

Claiming R&D Tax Credits using Tax Cloud

Tax Cloud is an R&D tax relief platform that guides companies in making maximised R&D tax claims that are accepted first time. Powered by industry leaders Myriad Associates, our team will support you through each step, and will be happy to answer your questions as you go.

We’re also very proud of our proven success rate, and will also check your claim thoroughly before it’s submitted to HMRC.

Why not see what you could claim using the Tax Cloud calculator or call 020 7360 4437. You can also send us a message.
Barrie Dowsett, ACMA, GCMA
Author Barrie Dowsett, ACMA, GCMA CEO, Tax Cloud
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