Price of locally brewed beer

Why is beer brewed and bottled in my hometown the same price as beers from all over the world? It's $8.99/6er for beer 5 miles from the brewery - same price as several comparable and superior selections from Europe and the far corners of the US. Sure the local beer is decent but it isn't world class and it bothers me that extra profit is being made off of me. Transport isn't cheap and those discounts should be passed on. I don't buy the local beer for that reason, am I wrong?

For breweries that distribute they are sort of handcuffed by distributors. Especially if you live in a state that doesn't allow self-distribution. Distributors don't want to carry a product if at the brewery they are under-cutting prices. And if the brewery relies on a distributor for the local market, well it's the distributor who sets the retail pricing. The brewery will have a suggested price, but once it's out those brewhouse doors they have no control over what distributors or retailers do in terms of pricing. The three tier system that emreged after prohibition protects distributors and retailers. Sadly it's not always favorable for the producer, and never favorable for the consumer (beyond potentially allowing for a larger variety on store shelves).

there is a lot more that goes into pricing than just transportation cost. scale is the first that comes to mind.

beyond the distributor as Gduck pointed out, who says it's not the retailer who's taking you for a ride? "all my customers are used to paying $9 for craft beer, let's mark up the cheaper local stuff and make a little extra profit".

i'd say yes, you're wrong to boycott local beer because of this (mis-) perceived inequality IMO.

Whether it's the brewer, distributor, or retailer, or some combination, the fact remains that I'm paying a higher markup (over cost) for a beer made 5 miles away over a beer made 5,000 miles away. I'm down for supporting the local brewer, distributor, and retailer, but not when they're collectively shafting me. I understand distribution agreements and the like, but why would they change those terms while they're disproportionately profiting from local customers? They wouldn't.

3 tier system - there's no escaping it.

sroberts said:

Whether it's the brewer, distributor, or retailer, or some combination, the fact remains that I'm paying a higher markup (over cost) for a beer made 5 miles away over a beer made 5,000 miles away. I'm down for supporting the local brewer, distributor, and retailer, but not when they're collectively shafting me. I understand distribution agreements and the like, but why would they change those terms while they're disproportionately profiting from local customers? They wouldn't.

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Because your local is brewing small (like 7bbl) batches where European stuff is made several hundred barrels at a time. Economies of scale. Also, help up your local brewer put his kid in a football program or buy his little girl some shoes by spending your money there instead of lining the pockets of foreign investors.

Why does everyone think that all brewery owners are swimming in cash?

Think of all the people who touch the beer before it lands in your fridge -- yeah, you have the brewer, but you've also got the retailer and the distributor. Maybe it's the brewer who's screwing you over, but he's got the biggest motivation not to, since changing your brand of beer is easier than changing your local liquor store, and a heck of a lot easier than changing the distributor, of which there are a maximum of two in most places.

Cut out the middlemen and go get growler fills. If you're still paying the same per ounce refilling an already-purchased growler as you are buying Stella at the liquor store, OK, maybe you have a point, your brewer is gouging you. But until then, I'd give the poor guy the benefit of the doubt.

I agree that you shouldn't beat up your local brewery for what is essentially the distributor's sins.

I'd take the OP idea a step further and suggest that local breweries should buck the distributor model and sell truly local beer.

I'm sick of getting gouged for west coast craft beers. $8.99 for a 22oz bomber? C'mon. $12.99 for a 12oz sick pack? Stop it already.

I'd love to see 'local' breweries in every town. Making quality beer at a fair price. I live in Albany, NY and back at the turn of the previous century Albany was lousy with local breweries. Hinkle, Beverwyck, Dobler, Hendrick - heck we even had a Schaefer brewery for awhile. Everyone had a 'neighborhood' brewery.

Albany was even at the cutting edge of the latest craft beer movement. We had one of the first micro breweries in the US - William S. Newman Brewing Company (Jim Koch worked there while plotting to start Boston Brewing). The brewery was in a downtown neighborhood and you could walk in anytime and they would sell you paper to-go pitchers full of fresh beer. This was in the late 1980's - not that long ago.

I'd love to see it become easier to sell beer like we sell produce. At roadside stands. Now that would throw the distributor model on it's ear.

come to Canada.. you will be happy with any price you get down there

Sweetwater is the beer - a regional brand, not exactly a mom & pop shop. I don't think they're rich, they're just overpriced to me.

I wonder how much of that overpricing for local beer is set by the distributor/retailer and how much is set by the brewery itself. There's a local brewery that bottles and distributes through Miller's distributor (Andrews?). It's one of two or three distributors in the area and no self-distribution is permitted. Their beer is on the shelf with other craft brewers from the same distributor yet their beers are more expensive than the other craft beers at the same store from the same distributor. It is always more expensive. Their volume is much larger than other regional brewers that sit on the same shelves so comparably, scale is eliminated as an explanation.

Economies of scale.

Small brewery, new brewery --> Economies of scale.

Greenbasterd said:

come to Canada.. you will be happy with any price you get down there

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Very true. Why the heck is beer so expensive in Canada? Taxes?

Let's Ban Profits!

Still no one talks about the 3 tier system- thats why your local doesnt save you any $. If they could sell direct to you than would see a deal. Only way around it is growler fills or brewpub. The middleman eats your deal.

I don't see it any cheaper at the brewery and it comes from the back room to the cooler.

iaefebs said:

I don't see it any cheaper at the brewery and it comes from the back room to the cooler.

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Then they are screwing you. We don't have direct distribution here in Texas but when I've been in other states that do allow it pints seem to run $3-5 at the brewery but $5-7 at bars. So maybe not a big difference but they shouldn't be charging the same price in the taproom that you pay beyond the brewery.