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Inside Ale Street
| Beer Buyers Bite Price Bullet |
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| Written by Jack Curtin | ||||||
| April 01, 2008 | ||||||
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If an entirely unscientific survey by Ale Street News of a few random beer wholesalers and retailers around the county is to be believed, all those initial fears about the impact of higher beer prices due to hops and malt shortages were probably not warranted.
If anything, the news from our sources is both encouraging and enlightening. In the early going at least — and we are still early in this sales cycle, that needs to be made clear — transparency and quality appear to have won the day.
To a man, the people we questioned noted that the advent of rising prices was made totally transparent to consumers well in advance through the efforts of both brewers and those who sell their products. That is the single factor which appears to have defused the situation before it happened. Most also see the fact that there was no across the board resistance to higher prices by an educated customer base as strong evidence supporting the argument that craft beers sell on flavor and desirability much more than they do on price. While everybody would like to pay as little as possible for great beer, in other words, those who have come to appreciate craft beer appear not to be adverse to paying a fair market price for what they perceive as good value. Indeed, George Bradley, general manager of Westy’s Beer Distributors in Camp Hill, PA, says that his company “ate some of the margin points and then actually gave our retailers an extra point to make them aware that we are on their side. Our business has grown to where we could afford to do that and we see this as a move which helps us continue to grow.” He also feels that all the talk about higher prices misses the point. “It’s time we accept once and for all that we are not selling price. For years, this business was all about the big guys getting their prices down as low as they could because that’s what made the beer sell. The idea that the value of our products on the craft side amounts to something more than just a number is still a relatively new school of thought for a lot of people. In that sense, this whole situation might turn out to have been a very positive thing if it gets across the fact that consumers are generally willing to pay the price when they know that what they are getting is a really good value. “The way I see it, the craft business has always been a ‘beer first’ idea and the money always seems to take care of itself.”
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