Friday, November 2, 2007

Our First Internet Meme

I'm so excited. These internets are so awesome. It allows us to have a (inter)national discussion without actually picking up a phone or being social or pleasant! We can lob insults back and forth with reckless abandon knowing in our heart of hearts that there are no consequences! WooHoo! Wild irresponsibility rocks!

Of course, we can hold civilized discussions leveraging the collective intelligence and locational viewpoints of hundreds and thousands of people. We can gather opinions and facts and let those with specialized knowledge chime in when necessary to arrive at a reasonable conclusion about issues that affect an entire industry.

It's the latter of these that I plan to engage in (though I do loves me some reckless abandon every now and then). And, I had been planning on doing a post about this at some point anyway.

For some of the other thoughts on this see the excellent discussion at RateBeer and by Alan McLeod at his Gen-X at 40 Beer Blog.

The basic question to be debated is this: does a particular beer have "worth" above and beyond what the market will generally tolerate. Or, would you ever pay $50 for a single bottle of any beer? Before we start, I'll just mention that, yes, there are beers out there (even non-cellared) that can fetch hundreds of dollars for a single bottle (e.g., DeuS, Utopias). Cellared and aged can fetch even more.

We can start the conversation by saying that the wine folks don't have this issue. No one really considers it a problem that some bottles of wine (750ml) sell for over $30. But if beer sold in a 750ml size is over $10, it is considered expensive. This seems, to me, to be a matter of consumer expectations.

We have been trained by Miller, and Budweiser, and Pabst, and Coors that beer is cheap. Well, cheap beer is cheap. Boone's Farm is cheap, but no one holds that against the wine producers. But, Sam Adams is inexpensive, too. And, that starts the problem; because what is to be done about quality beer that sells for, approximately, the same price as the corn-and-rice watered-down beer?

Beer has always had an "everyman" aura. From its earliest days, especially in this country, beer has always been accessible to everyone. Sam Adams can sell its beer for a negliglibly higher price because, well frankly it just doesn't cost that much to make beer. Once the profits are added on, the stuff just isn't that expensive to make. Of course, even as this is written, some of this is changing because prices for hops are going through the roof due to crop shortages. Same with Barley, shortages are affecting prices all over the planet as barley growers are switching to ethanol-powered subsidized corn markets. So, the raw materials actually are more expensive in some cases. Prices for (IIIII)IPAs will start to go through the roof.

But that still leaves the issue of why some beer, regular old, nothing too amazingly special other than that it is produced really, really well, beer, costs $50+ for a bottle of the stuff. Well. For the same reasons we spend $50+ on a bottle wine to be quite honest. You pay for quality. You pay for name. You pay for scarcity. You pay for the artwork on the bottle. You pay for the bottle itself (750ml, cork and cage bottles are not cheap).

But mostly, you pay for name and scarcity. Cuvee de Tomme, from Lost Abbey, costs a lot because Tomme Arthur is well-respected as a bad-ass brewing god. He knows what he is doing. Thus his work is in high demand. But, in order to maintain his own standards, he brews in very small batches. Thus, if you want some of his beer, you must stand in line. And you must pay for that right. Why? Because someone out there will pay for that right. But, you say, why doesn't he just make more? Buy why, I say, should he? He's happy with his rare, expensive product. The fact that no one that can't make it to the brewery personally and isn't willing to spend $300 for a bottle of the stuff can't have it doesn't really seem to bother him.

Calumet BreweryUs Midwesterners might say, that's typical of Californians. Everyone else be damned they'll sell to the highest bidder for the sheer ego of it.

Consider, on the other hand, Rowland's Calumet Brewing Company in Chilton, WI. They're beer is equally as rare. Equally as amazingly awesome. But, you can go to the bar there in Chilton, sit down and buy a mug of the finest Oktoberfest made in this country for $4. There's a cheese spread in the back area for the taking. Mr. Rowland's wife will serve it to you. And, if you're lucky, and if they don't think you are some sort of weirdo tourist who got lost on the way to Green Bay, you can strike up a conversation with the three other people that are in the bar with you.

At Calumet, you have scarcity but no "name." Bob Rowland's son (Bob Rowland passed last year) isn't out talking to anyone that will listen about how he has to put his in beer in bottles that cost $2 before any beer even goes in them. He doesn't enter his beer at the Great American Beer Fest. He doesn't sign autographs for adoring fans. In fact, I've never seen him; don't even know what he looks like. The vast majority of Wisconsin, let alone the world-buying public has no idea that Rowland's Calumet exists. There is no demand for his beer, despite the fact that it is some of the finest beer made in the United States.

So, at the end of the day, where does that leave us? Probably where we started. It's all about markets and simple economics. If you think you can sell everything you made for $50+, go for it. Markets can be brutally honest some times (despite the fact that sometimes markets are wrong - to wit: New Glarus' Enigma is a fine session craft beer, but a year later this stuff is still sitting on shelves - they literally cannot give it away, despite name and scarcity).

side note: you will notice the picture shows a celebration at Rowland's Calumet for their 6000th barrel. That's not 6,000 barrels this year, that's 6,000 barrels ever. They've been brewing since 1990. They hit their 6,000th barrel in June of 2007. It took them 17 years to make as much beer as Tyranena will make this year alone. Please, if you love beer, and you know what's good for you, stop in Chilton on your way to a Packers game. Heck, drive the two hours just because. It is an amazing place.

1 comment:

  1. if you want my autograph just ask beer is $2.75 a pint not $4.00 & we do not bottle


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