Thursday, 15 February 2018

Getting what you pay for

It's good to see some talk about class and price in craft beer coming up again. For all that pricing issues generate endless bickering, it's a subject that shouldn't be ignored. How many people are put off by the cost of craft beer? Is it socially responsible to create a culture that has a financial barrier to entry? Should craft brewers be more concerned with making beer that's more widely affordable - affordable as a regular night-out drink, not just for one reverentially sipped half a month?

The focus in this last suggestion is often on ingredients. Picking and choosing high-grade malt adds to a brewer's costs. So does using large quantities of the currently fashionable hop varieties. So does picking fancy extra flavouring ingredients - single estate coffee or Madagascan vanilla pods. Could a craft brewer use less expensive raw materials, maybe just for one beer, to produce something that's still great, still representative of modern beer, but is affordable to a much wider market?

The problem with this is that ingredient costs aren't the whole story - in fact, they're sometimes a relatively small part of the whole story. Breweries are also spending money on, among other things, rent, wages, capital, utilities and transport costs and small breweries are generally going to be less efficient and less able to save money on those costs than a larger operation, even if they're brewing an identical beer. They won't have spent the effort ruthlessly optimising their process, their equipment and their business to keep overheads as low as possible.

In short, when you pay "craft prices" for a pint in a pub, you could actually be paying for quite a lot of things:

  • You might be paying to support a bar that's designed for comfort rather than capacity.
  • You might be paying to support a pub that doesn't compromise its character by doubling up as a coffee shop or a family restaurant.
  • You might be paying for beer that's been kept in chilled storage and sold fresh rather than being kept at ambient temperature for months on end.
  • You might be paying to support one of a number of a small, independent business rather than a larger and more efficient industrial operation.
  • Or you might be paying for more hops and higher quality malt.

I don't really have a simple pronouncement to make on what's right and wrong here. In practice, I suspect that a lot of different approaches can co-exist, from Punk IPA in Wetherspoons to the priciest teku of nanobrewed barrel-aged stout in a modernist craft-temple. But I do think that when we ask for beer to be cheaper, we need to think about what we'd actually be willing to compromise on to get it there, because just using unfashionable hops won't do it on its own.

1 comment:

  1. One thing I see often that doesn't help is retailers sticking religiously to a % mark up, when they could be taking a cash margin. This leads to ridiculous ten quid plus pints. Restaurateurs don't expect to make the same % on the wines at the pricier end of the scale; the best mark up is on the house wine but a bottle of bolly will bring in more actual cash.