February 5th, 2008
Potential Price Hikes
As ive spoke to many folks over the course of the last several months there has been lots of information and misinformation on the price hikes of Beer. There are a couple things to note 1) We’re in a beer renassaince. Ive said this since before i opened Hamilton’s that the common palettes have changed and will continue to change and ive seen wine bars turn to beer and not beer savvy establishment improve there lineups and these are good things. 2) Without talking about vague points I want to really drill down into the simplisitic keys to why establishments will race to the gun to increase prices
- price of nickel increased in early 2007 causing a hike in cooperage
- Price of gasoline obviously increased causing delivery and distribution hiked
- The need for alternative fuels pushed the agriculture market to the windfall of corn and to disregard their land and plots for other products
- the above pushed LARGER market establishments to secure in long term contracts buying up alot of inventory on guarantee contracts
- the weather has dictated a shortage in crops as well
Here is some TRUE transparency:
Since oct 2006 we’ve seen products like XYZ IPA go from $106.00 to
$123.00 and now again up to $140.00-160.00 other high gravity micro beers going from 150 – 168 and
now $190.00 -210 Again this is just an example for clarity. These increased
represent a 26% – 33% per 1/2 bbl and depenidng on long draw or short draw
close to 43% increase per pint pour cost. Yet my prices have not deviated.
It’s inevitable at some point that the prices will have to increase and inflate but you look at the increase of high end beer im clearly outlining above and note: our prices have not changed. In my heart I want to be one of the last places to increase pricing not on the cutting edge of the price hikes but if/when they come this is why. I suggest doing your market research and dont allow the snake oil purveyors of warez to tell you else!