Is Beer Too Expensive?

August 29, 2018

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Is Beer Too Expensive?

Nearly two years ago, we published A Blog about Cask. It was a defence of the price of cask beer from small brewers such as ourselves, where quality is the main consideration by the producer.

TL;DR - if you want higher quality, it comes with higher prices. And even those higher prices aren’t as high as you think they are.

It’s possible to brew an exceptional beer at a low price. Many brewers do. We do. Cwtch won Champion Beer of Britain in 2015, and is £3.60 a pint on cask in our pubs. That’s exactly the average price for a beer in the UK. OK, so “average” isn’t necessarily the same as “low”, but when you consider that the stuff on the lower side of that average are produced in places like this using cheaper ingredients and have enormous economy of scale to drive raw material costs down, the national average for a price of generic “beer” is set pretty damn low.

Anyway, while it’s possible to brew a technically excellent beer cheaply, drinkers (ourselves included) are curious. The days of going to your local for a pint of the usual are largely over. We like to try new things.

There’s a phenomenon around the idea of quality - you might think that pint of cheap(ish) beer is of the highest quality, but you might come across something slightly different - slightly more punchy, more flavourful or more unique - that might go just beyond your comfort zone, but not enough to be uncomfortable. To some, that can indicate that their boundaries have been shifted - maybe this new beer is higher quality than the one before.

There are other factors that go into that concept of “quality” - the respective quality of the individual raw materials, the processes involved in production, the time taken over the product, the dedication to a small quantity rather than an immediate attempt to scale enormously. Different people have different levels of respect for each of these factors. So in that sense, our perception of quality is quite subjective. And then comes personal taste, as in the actual reaction of your tastebuds to the liquid. Many of us are easily confused between taste and quality (Hello untappd users who leave Frambuzi a one star review because it’s “too sour"), but that’s ok. Each to their own etc. etc.

We’ve always said, in blogs, tweets, interviews and articles - one of the best things about this industry is the variety. In every aspect. Price, style, flavour and design. It’s exciting and vibrant and interesting. It’s fun.

All of this is a bit of a preface for what feels like Part 2 of A Blog About Cask. Here’s a Blog about Beer Prices, or “Is Beer Too Expensive?”

IS BEER TOO EXPENSIVE?

If you’ve heard of Betteridge’s Law of Headlines before, you’ll know the answer already.

If you don’t:

"Any headline that ends in a question mark can be answered by the word no."

Our friends over at Craft Beer Co. got a couple of kegs of Alesmith Speedway Stout Hawaiian Special Edition over from the USA. It’s got a bit of press, because newspapers are shocked that it’s £22.50 per pint, making it "Britain's Most Expensive Beer".

The standard edition is a big, bold 12% stout that is enormously well regarded. At 12%, it ain’t your average ABV. Guess what? That adds to the cost.

The Hawaiian Special Edition is, well, Special Fucking Edition. It’s rarer. It’s different. It’s had something special done to it to make it special. In this case, “expensive ingredients”. Guess what? That obviously adds to the cost.

Then it was shipped over here. Guess what? You get the point.

Then it had to be taxed. Guess what? Blah blah cost blah blah blah.

Then it had to go on the bar and allow the retailer to pay for staff to pour it, lights so customers could see it and chairs to make sure they don’t fall over a) at the price of a pint, and b) because a pint would be nearly 7 units of alcohol. Guess what? Yep, you guessed it. That adds to the cost.

The guys at Craft Beer Co. like to offer the best and, as their name suggests, they are explicit in their offering of craft beer. So they get some of this incredible stuff over to offer to their customers - mostly people who already enjoy craft beer or those that are interested in trying it. These people can respect that all of these steps add to the cost, and therefore the price, of the beer at the bar.

And if they want to try it, they respect that they have to pay for it.

Here’s the crux of the issue - “Beer” isn’t a commodity. It isn’t a single, monolithic product where the only difference is price. It’s a diverse industry with many innovators and many opportunities to try something different. “Beer” is the umbrella term for a mind-bogglingly large number of products.

Just like Newspapers. There are those that are 35p, but there’s also the Financial Times at £1. They’re both technically newspapers, but their value really depends on what you’re looking for. They’re apples and oranges.

APPLES & ORANGES

Speaking of apples and oranges, the original articles on the beer stated “Per mililitre, the stout works out as more expensive than a bottle of luxury Belvedere vodka - which cost £45 each.”

Ignoring the fact that that is mathematically nonsense (we’ll come to that), let’s talk about how that is an unfair comparison.

One is being sold in a supermarket - that supermarket buys in bulk and sells a lot of other stuff. It makes its money because you buy more stuff. Sometimes, they can offer premium products (like, say, vodka) at a loss in order to entice you to them and get their money back selling you a wide variety of other stuff with high margins, like the fizzy drinks you’re going to mix your vodka with, or the £5 tubs of spirit garnish that contain a few pennies worth of botanicals.

The other is sold in a dedicated bar that carefully curates its selection and goes out of its way to get the best. The only other thing it has to sell you is a packet of crisps so they can’t really afford for their beers to be loss leaders.

QUICK MAFFS

£45 in a supermarket, but what would that be at the bar? No chance!

Most bars will sell it as a 25ml measure. We found bars selling Belvedere locally between £3.80 and £5 per 25ml. That’s 15-20p per millilitre.

Even if it was by the bottle, as many bars and clubs do? The first local place we found that sells Belvedere sells it at £140 per bottle. That’s nearly 19p per millilitre. Another place, £150. That’s 20p per ml.

Speedway Stout at Craft Beer Co.? £22.50 for one pint, which is 568.2612ml. That’s less than 4p per ml.

If you’re going to compare them fairly, in the same setting, then the stout would be between a quarter and a fifth the price of the vodka. And if the ABV is all you care about (it shouldn’t be), the stout gives you more bang for your buck. It’s 30% of the alcohol for 20% of the price. Absolute bargain!

But all of that is ignoring that a 750ml bottle of Belvedere at £45 works out to 6p per millilitre. Let’s give them the benefit of the doubt, and say they were working on a litre bottle. £45 per litre is 4.5p per ml. The pint of stout is cheaper per ml than a litre bottle of Belvedere Vodka at £45.

IN CONCLUSION

In conclusion, some beer is expensive - but there’s a reason. And those that understand the reason understand the difference in price. The best way we’ve come across to summarise this point goes something like this:

There are £5 bottles of plonk for the dinner table and there are £5,000 bottles of Dom Perignon. Different strokes for different folks. Different occasions too. You wouldn’t celebrate winning the lottery by trying to spray a bottle of Pinot Grigio you picked up at the petrol station. And you wouldn’t sit down to watch Corrie with a magnum of Grand Cru bubbly.

Our request to the media and those currently outside the “craft beer community” or whatever you want to call it - please stop comparing apples and oranges (or Acetaldehyde to Citra in this case - nice little beer geek joke in there for you)

It does damage to a still fledgling industry when you try to persuade people that what we do is produce stuff for people stupid enough to pay for it. You back up those that think our products are overpriced, when some top brewers can’t turn a profit on cask beer. This helps the artificial suppression of price in the sector, and that’s a bad thing for everyone in the long run. You marginalise these fantastic products that are in high demand all over the world as “hipster”. It doesn’t help us as an industry.

It doesn’t cost the average price.

It’s not the average beer.

And it’s cheaper than the example you gave, you absolute numpties.

You asked the country “Is beer too expensive?” And then you helped us prove that it’s not. How do you like them apples?

 

Posted in: Our Beers