IN Brief:
- The UK no-, low-, and mid-strength drinks sector is estimated to generate more than £2.2bn annually.
- Participating manufacturers are operating at approximately 60% of available production capacity.
- Most respondents plan to expand production, with UK manufacturing and exports central to future growth.
The UK’s no-, low-, and mid-strength drinks industry is estimated to generate annual turnover of more than £2.2bn, giving the category a larger manufacturing base than retail measures alone suggest.
The inaugural benchmarking study also estimates that the sector supports more than 6,400 jobs. Its authors regard the valuation as conservative and believe the total could approach £6bn once mid-strength beer is measured more comprehensively.
Club Soda developed the benchmark using information from producers of alcohol-free beer, wine alternatives, spirits, aperitifs, cocktails, and mid-strength formats.
Participating businesses directly represented more than £172m in annual turnover. The typical producer was founded in 2018, employed around four people, and generated approximately £500,000 in sales, indicating a market that combines younger specialists with established drinks groups.
More than half of the producers had secured external finance, with reported investment exceeding £38m. Eighty-six per cent planned to expand production, while three quarters expected to recruit additional employees.
Current output was running at approximately 60% of available capacity. That headroom gives the sector room to grow without immediate factory construction, although individual producers may still face constraints around brewing, fermentation, dealcoholisation, blending, maturation, filtration, canning, bottling, or warehousing.
An average of 73% of respondents’ production took place in the UK. Almost one third were exporting, most commonly to Europe and North America, and exporters generated an average of about 40% of their sales from international markets.
Production cost, regulation, and consumer awareness were identified among the principal barriers. Government decisions expected later in 2026 include potential changes to alcohol-free descriptors, which would influence formulation, labelling, categorisation, and marketing.
Moderation drinks require distinct processes
No- and low-alcohol production encompasses several manufacturing methods rather than one standard process. Brewers may restrict fermentation, remove alcohol after brewing, blend down a conventionally fermented product, or use combinations of those techniques.
Wine and spirit alternatives employ different systems involving extraction, blending, aroma recovery, botanical ingredients, acids, sweeteners, and preservation. The resulting capital and operating requirements vary considerably between product types.
Vacuum distillation and membrane systems can remove alcohol while retaining more aroma than higher-temperature methods, although they require specialist equipment, cleaning, energy, and process control. Restricted fermentation may use familiar brewing assets but creates a different flavour and stability profile.
Lower alcohol content also removes part of the product’s natural microbial protection. Packaging hygiene, pasteurisation, sterile filtration, preservatives, pH, dissolved oxygen, refrigeration, and shelf-life validation therefore require closer management.
Available filling hours do not necessarily translate into usable capacity. A packaging line may have spare shifts while lacking suitable microbiological control, tank segregation, or product treatment for an alcohol-free drink.
Specialist dealcoholisation equipment can form the opposite constraint, with brewing and packing capacity available on either side of an asset that cannot process additional volume. Capacity planning needs to separate nominal plant hours from the rate of the limiting stage.
The sector is becoming more structurally organised as brands seek manufacturing, distribution, and commercial scale. The acquisition of Days Brewing by Sunrise Beverages connected an alcohol-free beer brand with a broader operating platform.
Contract production is likely to expand as smaller brands increase sales without building complete plants. Co-manufacturers must manage customer recipes, brand-specific ingredients, alcohol measurements, cleaning, allergens, packaging formats, release testing, and stock ownership across several businesses.
Regulatory definitions influence each process route. A higher permitted alcohol threshold for products described as alcohol-free could change the degree of alcohol removal required, reduce process cost, or allow different brewing methods.
Existing products may then require reformulation, revised laboratory controls, and new packaging. Exported formats add further complexity because descriptions, thresholds, excise treatment, and product categories vary between jurisdictions.
The reported 60% utilisation suggests room for growth, although many moderation brands compete through distinctive botanicals, flavours, formats, and premium packs. Greater variety creates shorter runs, additional cleaning, and more packaging changes even when total volume rises.
Improving utilisation will require producers to aggregate demand, increase campaign lengths, and standardise some operations without losing the product differentiation on which the category has developed.
The benchmark places the sector beyond a discussion of changing drinking habits. More than £2.2bn of annual activity now depends on production assets, technical skills, ingredients, packaging, quality control, logistics, and regulation functioning as an industrial system.
