Thursday, 21 November 2013

Rare and Expensive Beer

I find the beer world amusing sometimes. One of the things that gets me a little is the principle some hold to that no beer should be too expensive. This one really has me baffled.

Now, don't get me wrong, I get the idea that everyone should be able to afford to buy a beer. Arguably the supermarkets do a great job of making beer affordable. Yes, I know it might not be beer you or I approve of, or like, or whatever, but it is there and it's available. It might be nice to make all beer this cheap, but that is an unrealistic option.

Andy Mogg's Hardknott Stash part 1
Now, most discerning beer drinkers would prefer to spend a little more on buying a better beer. The individual will have an opinion on that, but that's personal choice. Many good people will prefer to drink beer in a pub, or perhaps one of these new-fangled "Craft Beer Bars" - whatever, good beer is better in great company. This, we should accept, will be more expensive than buying beer at the supermarket.

When it comes to production beers we have decided to try and maintain our products the way we like them, and try to sell them for an appropriate price when considering this fact. It has been tempting on occasions to invent new beers, that might be less expensive to make, and therefore be able to undercut other breweries where a customer just wants cheap beer, but that's not the way we wish to operate.

Basically, everything we sell is sold at the price we believe it's worth. If you don't agree it's worth that much then fine, we understand and you simply don't buy it.

Rare beer is an interesting point. Some critics point to the fact that some brewers deliberately make beer rare so as to inflate the price. Well, I can see that point of view. Of course, the consumers choice is still there. Don't buy that beer and forget about it.

Andy Mogg's Hardknott Stash part 2
We've never really done that. All our beers are sold based on what we think they are worth from the point of view that we know how much they cost to make and we know how much we need to add to that to make a reasonable living and pay all the overheads and staff wages. And lets not beat about the bush, we don't make a great living, we are not rich.

When stocks of one off beers have dwindled in stock levels we have stopped selling them because we want to keep some back for ourselves. You've all had your chance to buy them at the normal price, so you can't really complain. Some people have the sense to buy them early and store themselves. You know who you are, well done.

My feelings are that I don't want to sell the small stock we have, but Christmas is coming and my nephews and nieces will expect presents. The Christmas budget is just a little too small this year. So, I've put nominal values on all our limited stock of beers and I am offering them for sale1. If no one buys them, I'll be happy because I'll still have my stock for personal use, or for meet the brewer events, etc.

If people buy any of them it's because they have a desire to own, try or collect the beer. The alternative is just to keep it for myself, it's my beer after all.

Click here to find the beers

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1To work out how to price up the rare stock I started by asking myself "What if I only had one bottle of a particular beer, how much would I sell it for?"

My initial reaction to asking myself that question was to reply with "Never, I'd never sell that last bottle"

"What? Even for a million quid?"

"Well don't be silly, a million quid is a lot of money. I'd be stupid to turn that down"

"So, what price, you stubborn git, would you accept in that scenario?"

After some discussion, which started to get quite heated, and both of me were in danger of falling out with each other, we both agreed that perhaps a figure of £1000, a grand, was about right.

Both of me are quite happy with that figure. We'd both like the last bottles of my stuff to out live us really. We have an amusing image of all our friends gathered round my coffin necking my last bottles and claiming that I wasn't such a bad chap after all.

We've now got a nice complex2 algorithm with which to calculate the price of rare stock. As the stock level decreases so the price goes up. Neither of me fell out with the other during the formulation of this algorithm. We're quite proud of it actually.

2OK, I lied, it's really quite simple. Take the last remaining hypothetical bottle price and divide that by the number remaining and add in a "if" to make sure it isn't below the production price. The resulting prices are to my liking. The "if" statement also defines the threshold of "rare"

If you are clever, and you must be if you read this blog, you will note that the total accumulated value of all my remaining rare stock adds up to quite a lot of money. If I sell it all I'll be sad that all my back issues beers have gone. On the other hand, I'll have made quite a bit of money. These are the finical choices that have to be made in a commercial world. I suspect I'll end up remaining poor, but happy.

9 comments:

Alan said...

Actually I prefer to not buy it and complain about it. Once in a while I buy it and complain about it. But don't expect me to be a good little sheep, stay quite and fort get about it. If you enter the marketplace you are open to assessment. If you want people to treat you like a well meaning second cousin stick to homebrewing.

Alan said...

Frigging iPad. That was me.

StringersBeer said...

put 'em on EBay.

StringersBeer said...

...and another thing, have you run this past your accountant? Strikes me you've just inflated the value of your stock (by converting short-life old stuff into expensive rarities)- won't there be some impact on tax liablity?

Brewers Union Local 180 said...

http://www.katu.com/living/food-wine/This-beer-costs-two-grand-hair-of-the-dog-226533211.html

StringersBeer said...

There's a great quote about bottle conditioning on that page.

Dave Bailey said...

Alan, couldn't agree more. We are all, commercial brewers, open to criticism. You are free to express your opinion, and complain if that's what you feel like doing. We are free to decide how much we feel it is worth doing the job of brewing for and set out our stall accordingly.

Stringers, yes, eBay has it's attractions, but I was fairly sure it's not permitted to sell alcohol on there. Or am I wrong on that one?

On the subject of value for accountancy purposes, my accountant is fairly clear; it's at best worth the cost of production, and perhaps storage costs. Even then, until something is sold it is difficult to prove any increased added value. As it stands no one has bought any, so it seems we are all where we were before.

BUL180, so, just have to wait another 10 years and I can charge two grand a bottle.

Dave Bailey said...

Ah, good afternoon Stringers, you at a loose end too? Our comments posted at the same time.

it is an interesting thing, bottle conditioning. I had a very nice taste of your Mutiny last night that was properly bottle conditioned. Seemed very good I thought. From that last batch you did. Excellent stuff, your bottling process is obviously perfect.

I do wonder how many breweries do proper bottle conditioning.

StringersBeer said...

Good-oh. I'd kept you a few bottles out of that little batch you ran through your fancy machine for us. It's turned out well, I knew you could do it. Yep, priming up / reseeding (in any of the various ways this is done) a flat-ish, well matured beer really does give an excellent, genuinely bottle-conditioned outcome, doesn't it? That'll be why the greatest BC beers in the world are done that way. Now we need to sort out a proper little warm room, rather than have the office full of bottles for 2 weeks warm conditioning. It's an expensive way of making beer, I suppose. I can see why some people might choose to leave a homeopathic dose of yeast in a force-carbonated beer and call that it.

It occurs to me - given that I'd sold that whole batch before it was bottled, these few I was saving for you must be worth a fortune!