Beer pricing at retail

Much of the beer we like to drink – ‘craft beer’ – is made with better and more ingredients compared to ‘big beer’, and this is reflected in the price. Small-scale breweries also operate within tighter margins, and brewing isn’t a job that will make you rich (unless you decide to sell out, that is). This premium is a price we’re generally happy to pay, but how do we account for discrepancies in the cost of the same beer from place to place? How much (of a difference) is too much?

Cloudwater’s much-lauded DIPA v6 was recently on keg at two central London pubs that are practically next door to each other. One pub priced it at £4 for a third (the equivalent of £12 per pint), while the other charged £3 for a third (£9 per pint). To be clear, I’m using the price of a pint for illustrative reasons, but the customer below did indeed order two servings of 568 ml. Can we attribute this price disparity to anything other than individual businesses setting profit margins as they please according to their business model? Is this simply an issue of supply and demand? The respective character of both pubs is possibly a factor here; the former is a shiny new craft beer bar, while the latter is an old-school locals boozer (albeit one selling ‘craft beer’). The Craft Beer Co. chain has also gained mild notoriety for its pricing strategy: here a pint of Gamma Ray will set you back £6.50, while it’s £5.80 in my local (I’ve also seen it priced at £5.50). That’s a significant difference over the course of an evening if you’re silly enough to session Gamma (cough), but again, is this anything other than simple capitalism?

We lay drinkers are on the outside looking in when it comes to such issues, and our lack of ‘insider knowledge’ can be frustrating. However, when a professional brewer takes umbrage at the price of a beer I’m inclined to take notice – especially when the owner of the brewery that made the beer is similarly perplexed.

While I’m happy to spend my disposable income on beer, I feel powerless when it comes to assessing the ‘fairness’ of the asking price. Yes, it’s down to me to decide how much value I place on a beer, but surely my perception of its value is influenced by the asking price? It’s not realistic for beer to come with a recommended retail price (Paul from Cloudwater’s comment, which you can see by clicking the embedded tweet above, was surely tongue-in-cheek), so we’ll have to continue to let ‘the market’ decide, and make our choice accordingly. The only problem is, when the consumer lacks knowledge there’s a power imbalance – meaning the market isn’t as ‘free’ as all that.

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