Something has been troubling me for a while now. It is undoubtedly a great time in the Irish Craft Beer scene, many new entrants, and more to come. Obviously there are a lot of passionate people out there making great beers, but there is something that has been gnawing at me for a while. The price of the actual beer in the pubs we frequent.
In these austere times people are looking for value, and craft beer has benefited from this change in consumer trends, where people will happily buy an artisan product for a little bit more for an undoubted step up in flavour from a macro beer. There is also an element of the green flag in supporting the Irish producers. However there seem to be more and more examples of pricing that can only be described as eye watering.
While it is a positive to see on the one hand publicans traditionally in neck deep with the Heineageo duopoly taking on Irish Craft Beer, and international craft beer. It is going to be more damaging in the long term in my opinion if a large premium above a macro beer on a craft beer. It seems to be a token effort.
@irishbeersnob @11pmSomewhere @BeerPadawan @beinmysolo Exhibit A – price for Galway Hooker pic.twitter.com/PxIo9arxoo
— Aidan Sweeney (@sweeney_aidan) April 13, 2014
Galway Hooker is a fine beer – but, €6.70 for a bottle? Granted a 500ml bottle but even so.
Now in an ideal world we’d all be holding hands singing kumbaya, drinking loads of craft beer, but that is a bit much considering a pint of heineken in the same establishment is a good euro less.
But let’s face it brewers don’t start brewing just for the hell of it. They are setting up a business where their aim is to make money. They sell their beer at a set price to the publican direct or through a distributor. They hold no control over the price it is sold at in the off license or pub. Who also need a margin to make their profit and cover their costs. That is how capitalism works.
However, in this fledgling industry, the common joe soap is not going to be swayed by a story of two people who gave up careers in x and y to brew beer. Oh btw its an extra €1.50 a go. The story alone is not enough to justify to these consumers to take the plunge and buy a proper Irish beer. The problem itself isn’t unique to Ireland, or even consumers here’s a tweet I came across the other day.
It frustrates me a lot that a beer that leaves here at £2.60 a (750ml) bottle is in a bar about 20 miles away being sold at £15 #greedy
— The Wild Beer Co (@WildBeerCo) April 17, 2014
The facts remain, less than 3% of the Irish beverage market is craft beer, it is growing at a great rate, but the long term viability on the industry is contingent on more craft beer being sold, and it would be naive of any new entrants to solely aim at this 3% there is 97% of the market to aim at. Higher prices will not grow this industry. It could however potentially harm it.
Yes I know American craft brewers have a much lower cost per unit than the cost per unit than in an Irish set up. The Excise rebate helps with that – and I doubt there are a huge amount of brewers charging publicans a large amount more on a keg than macro producers.
There is one example i’ve been made aware of recently that highlights this. The brewer in question distributes through a distributor, they have a nationwide set price per unit. Every pub gets the same cost per case. The variance on the price of a bottle was from €4.70 to €8.50. I can imagine the feelings of this brewer when they heard that top end price – who is going to pay that? I also understand publicans in major urban centres have large over heads but when this particular beer was also available on draft for between €5.40 – €5.70 a pint within 10 minutes of the €8.50 price in the same large urban area – as a consumer you have to ask, is that value for money? I would argue that price for a pint versus 8 quid for a bottle is supremely better value for money. Maybe Mary Harney had a point when she said “to shop around”
To quote Sarah Roarty
“It’s really important to keep beer in the hands of the people, not to gentrify it and make it so expensive that only high earners can afford the exclusive beverage”
I think that sums it all up for me.
I’d be interested to hear / read your thoughts, you can contact me on the twitter, or by email or comment below.