Is your LHBS taking advantage of the Shortage?

I recently went to a LHBS near me to buy ingredients. I left with some Iodophor...

I hate that place first of all, because you have to buy the grain in their special increments. For instance, I can't get 5oz of Roasted Barley...I have to buy a whole pound.

The Problem is, they are charging $16 for a 5lb bag of Domestic 2-Row. WTF is that??? A little math shows that as $3.20 a pound. The specialty grains were around $4 a pound. Another LHBS that is farther away from me charges 1.50 for base grains, and I forget what they charge for specialty, but not much more. Plus you can grind your own and get exactly what you need, not several pounds extra.

How rediculous is that??? I ended up ordering from Austin Homebrew, because with tolls and gas, it's cheaper to pay $6.99 for shipping then drive to the LHBS that I like. Plus I went in with someone else, so we are splitting the shipping.

I really would like to support my LHBS, but with prices like that, there is no way I am buying from them. I didn't even look at the hop prices. Sorry for the rant, just wanted to share the experience.

And 3 2 1, take it away Evan!.

I dont trust LHBS's much anymore either. I feel if its not part of a large chain (such as Friar Tucks in my hometown), then the ingredients may very well be so old that they need dusting. Skip that. I have been lucky with having pretty good LHBS, but there are def. some bad eggs out there.

outrageous prices... time to buy online.

I've noticed hop prices are ridiculous at most homebrew stores but haven't noticed much change in malt prices. And at $3-$4/lb. he's totally screwin people. At my LHBS I'd say the average $/lb is about $1.35 to $1.50. Mention something to 'em and ask 'em why they're charging more than double the going rate. Every HBS I've checked online is nowhere near that.

That's steep.
Now that you're buying online; watch out for
some of the vendors shipping on bulk grain. A 55#
bag of 2 row was at a mere 48bucks was going to
have a lovely shipping price tacked onto it of $27 !!
That's more than half the cost of the grain. That was
the LOWEST option they had on shipping.
The best deals are online, just do your homework, and
screw the LHBS if they charge like that. Those are hyperinflated
prices.

wildwest450 said:

And 3 2 1, take it away Evan!.

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Oh, you know it.

Hey, to the OP: what "shortage" are they "taking advantage of"? According to my sorta-local HBS owner, imported grains might be going up but domestic (breiss et al) are actually going down. I bought two 50lb sacks from him for about $50 each, and this was last month.

If people are stupid enough to pay $3.20 for a pound of domestic 2-row, then they deserve to be ripped off. End of story. The d-bag can charge $8/lb is he wants, and if people still buy it, more power to him. If there were stupid bastards out there who were willing to pay me more than the going market rate for something, who am I to turn down their money?

goddamn price gouging bastards

They want 6 bucks an ounce. How the hell am i supposed to brew when they are charging 6 bucks an ounce? Thats as much as they charge for a vial of White labs!

*edit

Oh wait, we're talking grains. I thought we were talking hops. I can still get base malt for 1.05 a lb which is still up more than last year, but I can handle that

I think you should tell the LHBS owner how you feel. Present the facts, not your emotions. If he states that he cannot stay in business if he lowers his price, then it is what it is and kindly tell him that you cannot afford to purchase ingredients from him. I am blessed with many great LHBSs in my area. I much prefer seeing what I am buying before I get it, I can see with my eyes how much turn over there is and how fresh my ingredients are. I just ask Brad behind the counter, 'hey how old is this stuff', and he says '___ days, it was dropped off two days ago'. I also like getting his advice and supporting the local small business. I have a great fear of buying ingredients from an online store/warehouse where I have no personal relation with my supplier.

However, I am lucky enough to have access to many stores near me that all have good stock and supplies. I would say in your case if the owner is a dick, or just has outrageous prices, give Forrest your business.

I agree with Evan! I have not seen a significant price increase for anything but hops. My local guy has great hop connections so still has most everything all the time. Because of this, he has spread the price increase of the limited supply hops (Cascade) across all hops so the price has increased, but that's no big whoop.

Evan! said:

Oh, you know it.

Hey, to the OP: what "shortage" are they "taking advantage of"? According to my sorta-local HBS owner, imported grains might be going up but domestic (breiss et al) are actually going down. I bought two 50lb sacks from him for about $50 each, and this was last month.

If people are stupid enough to pay $3.20 for a pound of domestic 2-row, then they deserve to be ripped off. End of story. The d-bag can charge $8/lb is he wants, and if people still buy it, more power to him. If there were stupid bastards out there who were willing to pay me more than the going market rate for something, who am I to turn down their money?

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**DELETED ENTRY** BLAH, not even worth it.

Regardless of what that guy says there is a grain shortage affecting prices of every grain based product. But not like that.

And I dont feel that I or anyone should just say, yea...let all the other ******-bags buy grain from this guy. That's why I decided to say something on here. Sure, if he can charge what he can charge, yay for him. But I care about OTHER HOMEBREWERS, so I'd like them to know that there are better options elsewhere.

Those aren't shortage prices, they're "all the traffic can bear" prices.

You did the right thing, just buy elsewhere.

Grain is grain and hops are hops. I have no loyalty issues to any LHBS. It all makes my beer no matter where it comes from, so best price wins.

bigben said:

**DELETED ENTRY** BLAH, not even worth it.

Regardless of what that guy says there is a grain shortage affecting prices of every grain based product. But not like that.

And I dont feel that I or anyone should just say, yea...let all the other ******-bags buy grain from this guy. That's why I decided to say something on here. Sure, if he can charge what he can charge, yay for him. But I care about OTHER HOMEBREWERS, so I'd like them to know that there are better options elsewhere.

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I'm not saying you shouldn't raise an issue about it---that's a great idea in fact. All I was saying is, the most powerful weapon anyone has in a case like this is their dollars, with which they vote.

man my LHBS is $2.45 a pound. I didn't know any better. But don't have any other local choice. Good think I got plenty of base 2-Row

You should definitely bring it up at the store -- ask them directly why they are so much more expensive than the online retailers. If you get a BS answer, you will know what to do. But you might get one that surprises you, as well.

In the end, at least the store owner will likely get some feedback about the 'success' (or lack thereof) of his retail strategy.

I have alot of respect for my LHBS. He could raise his prices significantly and since he is the only one around, he probably wouldn't go out of business anytime soon. The fact that he actually prides himself on keeping prices low makes me a loyal customer. (If you go to the website, click on the May 2008 newsletter link to see what I am paying for hops).

A LHBS that charges high prices might seem like a bad business model for those of us who have a good LHBS or shop online, but look at how many posts we see on this forum from people who have no idea where to shop. There are plenty of people out there who don't know any better and will keep a high priced LHBS in business.

It seems that, that home brew shop is a farging rip off. I to buy some stuff online but the LHBS here in St. Louis is pretty good. He is a little pricey but is a wealth of knowledge and has fresh homebrew on tap for samples. So to me its worth paying a little extra for the homebrew advice at my beckon call. But i am against any store be it home brew supply or otherwise that are in the business of taking advantage of people.

tdavisii said:

But i am against any store be it home brew supply or otherwise that are in the business of taking advantage of people.

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Me too. So someone, quick, tell me the "right" price this guy is supposed to charge for base grains? Make sure you factor in his rent, his sales volumes, the prices his suppliers charge, his supply chain costs, debt structure, and local competitive situation. And a reasonable profit margin.

Oh wait, we don't know all that? Hmmm, I guess that makes it harder then.

There is no way for a HBS to "take advantage of people". HB supplies are a "luxury" item, not a necessity, and there is plenty of competition out there.

Maybe he's got bad business plan that requires him to charge such high prices to stay in business. Maybe he's counting on a lot of people who are willing to pay more for the convenience he offers. If people choose to pay his prices, more power to him. If they don't, he'll go out of business. Either way, there's no "ripoff" here. All of his potential customers have a choice; it's not his fault if they choose not to exercise it.

If it gets too expensive, you can always buy a big speedboat and put 125 gallons in the tank at $5.75 a gallon for premium to go water skiing for the day ;-)

I think we've had our share of discussions on just what the differences are between gouging and an otherwise free capitalist economy. Can you imagine urging your congressman to step in to make sure you can afford brewing supplies to support your family?

damn, i'm so spoiled. my LHBS doesn't overcharge for anything...i'm still paying <$1.50/lb of grain and can get it cheaper in bulk. hops prices are $3/oz right now.

their turnaround is AMAZING. all the ingredients are nice and fresh because they're constantly checking what they sell and what to buy. it is a VERY well run customer-based business.

great beer always on tap, too. the extract recipes are incredible...i don't know how they get rid of the twang with certain recipes.

i practically live there.

Are you sure your LHBS isn't an ex-employee of a petroleum company?

My "LHBS" is a full 400km away, and charges only +/-$1.20 for most all base malts, speciality malts are +/-$2...

That's prices PER KILOGRAM (2.2 pounds)

Hops are +/-$2 per ounce..


You guys are getting ripped off, even the cheaper stores it seems.

Sorry..

Awfers

Excellent point bike n Brew. I guess if people want to pay it and he has a horrible business plan then more power to him. However in MY opinion, and it is only opinion, i hope that people will educate themselves and put his type of business out. So that being said I would never do business with a brew shop that i felt had completely uncompetitive prices.

I feel pretty fortunate. Base malts are about $1.40/lb and specialties are about $1.80. Hops are still $2-3/oz,...but the supply is rather limited. They definitely 'push' the hops that they have a lot of but always have something workable. As mentioned, it's best to vote with your dollar.

tdavisii said:

Excellent point bike n Brew. I guess if people want to pay it and he has a horrible business plan then more power to him. However in MY opinion, and it is only opinion, i hope that people will educate themselves and put his type of business out. So that being said I would never do business with a brew shop that i felt had completely uncompetitive prices.

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What do you mean by "completely uncompetitive"? If you ask your "friends" with the FTC, they'll probably tell you that selling far below average market value is what they call "undercutting" or "predatory practices"---and they would define it as "completely uncompetitive" and, if it were the right market (say, the petroleum market), they would probably fine the business who did it.

So then the question becomes, would your stance on not doing business with places that you feel charge to much swing in the other direction too? In other words, if your LHBS wanted to sell you hops for $0.50/ounce, which some would call "completely uncompetitive pricing", would you walk away?

Evan! said:

According to my sorta-local HBS owner, imported grains might be going up but domestic (breiss et al) are actually going down. I bought two 50lb sacks from him for about $50 each, and this was last month.

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Just curious, I've not heard anything about domestic grains going back down - my lhbs went from $50 in Nov. to $64 last week for sacks of domestic Briess 2-Row pale malt. I assumed it's either A) grain prices or B) shipping costs. Perhaps the latter?

Imported grain price hikes make sense, they have to be A) shipped or B) flown, and both of those require C) fuel.

My personal opinion is that if a business raises their prices significantly it should be for a valid reason (Their costs went up). If they are doing it just to make more money, then they should get the "******" award.

Daaaang 64 bucks for a sack of 2-row?! It must be 1) Not ordered in bulk 2) The LHBS owner has high operating costs and 3) High Shipping costs. I recently purchased a sack of domestic 2-row in a group pallet order for around 26 bucks. If you can find a local homebrew club this is defiantly the way to go. Get a bunch of people together and order a whole pallet of grains.

I've already priced every online retailer, and including the shipping, the cheapest OHBS comes to $1.75 under the LHBS price. Well, I guess I'd pay tax locally. So, ~6 bucks cheaper, But still above $60/sack. I've asked the local brewery too, and they don't have room in their grain contract to do that (plus it undermines the LHBS).

I want to buy in bulk - I'm on the St. Louis mailing list, but it's suuuuch a far drive. If I'm gonna go 8 hours each way for grain (read: if I'm going to burn 60 gallons of gas) then I want it to be a heck of a trip, at LEAST 10 bags of grain minimum. @$240 for round trip to STL in my truck, it would have to be 24 bags to even get down to $10/bag fuel costs. And I don't want to know what 1320lbs of grain would do to my gas mileage either.

I've tried to get other locals to go in on a big St Louis buy with me, but so far to no avail. Everyone is content enough with the prices that they're not gonna do anything about it. So in the meanwhile, I've been buying only what I need. I'm getting my bulk grains 10 lbs at a time ($15) and brewing lighter recipes, under 1.060.

My grain "bin" sits empty downstairs, and has been empty since I brewed the RIS at new years'. What I'd do to get a couple $35 bags of Rahr.

(edit: and correct, the LHBS buys in half-pallets because they're tight on storage space. i can't blame 'im. if he bought a full pallet, it would never sell, and spoil.)

McKBrew said:

My personal opinion is that if a business raises their prices significantly it should be for a valid reason (Their costs went up). If they are doing it just to make more money, then they should get the "******" award.

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And my personal opinion is that it's the owner's store, the owner's property, and he can charge whatever he damn well pleases for it, and there's nothing *****ie about it. *****ie is expecting business owners to charge less than the market will bear because of some kind of notion of "fairness", as if they're in business to serve you, like they owe you something.

Of course, he probably won't charge "whatever he wants", because the market will only bear so much. Outside of times of emergency with people who are selling survival necessities, I would call any business owner who charges less than the market will bear a fool, not a hero. There are exceptions (the "loss leader" is one), but as a general rule, if you're charging less than people are willing to pay for a good or service, then you're not a smart businessman. If you're charging more than people are willing to pay, then you're also not a smart businessman, because people won't buy your product if it costs more than they're willing to pay.

Look, I see a LOT of *****ie things every day...but I see nothing "*****ie" about charging what people are willing to pay. I know that's your opinion, but I disagree wholeheartedly. Our capitalist economy is not built on charity (charging less than the market will bear just to be nice), it's built on competition and mutually voluntary transactions.

McKBrew said:

My personal opinion is that if a business raises their prices significantly it should be for a valid reason (Their costs went up). If they are doing it just to make more money, then they should get the "******" award.

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i·ro·ny[ahy-ruh-nee, ahy-er-] –noun, plural -nies.
1. Complaint about capitalism by an internet forum user with a corporate cartoon character as an avatar.

Sorry, that just struck me as, well, ironic

But seriously, all pricing should be cost-based? And a business owner should sell a product for less than people are willing to pay because...why? Charity?

$64!!!!!! Ouch! Hope that's not domestic.

My "local" (30 mi) is ThingsBeer, which is at the Michigan Brewery, sells Briess malts for $33-$41/50lb and $1.10-$1.50/lb. Hops are now $3 and liquid yeast $6.25.

Bike N Brew said:

But seriously, all pricing should be cost-based? And a business owner should sell a product for less than people are willing to pay because...why? Charity?

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Apparently, if a store owner just wants to plain old make more money, he's a ******. It's gotta be a "valid" reason! VALID!!!! And wanting to increase profits is apparently not valid.

My LHBS isn't gouging on prices, but because of the hop shortage he's implemented a kind of anti-hording policy: You must purchase 3 lbs of extract or 6 lbs of grain for every 1 ounce of hops you buy. I guess this could bite me when i go to brew my next batch of Hopopotomus, but for most batches it hasn't been an issue. In fact I don't even think it's that bad of an idea. I can't complain, I just bought some cascade whole hops for $1.95/oz. yesterday. I hadn't seen cascade in the freezer in months!

Bike N Brew said:

i·ro·ny[ahy-ruh-nee, ahy-er-] &#8211;noun, plural -nies.
1. Complaint about capitalism by an internet forum user with a corporate cartoon character as an avatar.

Sorry, that just struck me as, well, ironic

But seriously, all pricing should be cost-based? And a business owner should sell a product for less than people are willing to pay because...why? Charity?

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Another opinion of mine is maybe we should just not take advantage of others just because of capitalism. Just because you can get away with it doesnt mean we should. On the other hand i hope our economy puts this guy out of business. I do agree with most of what you say bike n brew but at what point would you not back this high priced LHBS? At what point does it become just out right wrong?

Im in the camp that believes a business charges what they can. And the market dictates that result.

If the guy can get you to pay $4/lb, more power to him. If the next guy that comes in says "No way", and goes to the next LHBS, then so be it. But as long as people pay $4/lb for grain, he'll keep selling it.

This isn't exactly a necessity item. You know what you are buying up front. I see the same arguments or negative feedback on eBay. People will rate a seller poorly or give negative feedback because of high shipping costs AFTER they buy something when they knew the shipping costs BEFORE they bought it. So they KNEW they would get hosed and still bought the item yet they choose to complain.

This isn't like the government is seizing assets or property via eminent domain and is paying "fair market value". There isn't a fair market value in this case. It's capitalism at its finest. The market will bare his fate.

Evan! said:

If you're charging more than people are willing to pay, then you're also not a smart businessman, because people won't buy your product if it costs more than they're willing to pay.

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I will redefine my use of the word ****** to mean "poor business practice."

Evan!, as much as your economics posts p!ss me off, you are totally right. No one has to shop at the LHBS that is selling items at a price significantly more than the competition and it seems like many of us can agree that it's not the way we would personally run a business.

Take for example the gas station owners who raised the prices to $6/gal after Hurricane Katrina. Everyone called it price gouging, but in reality as long as people were willing to pay it, there was nothing wrong with it. Am I finally getting it?

bigben said:

I hate that place first of all, because you have to buy the grain in their special increments. For instance, I can't get 5oz of Roasted Barley...I have to buy a whole pound.

The Problem is, they are charging $16 for a 5lb bag of Domestic 2-Row. WTF is that??? A little math shows that as $3.20 a pound. The specialty grains were around $4 a pound.

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- Mine sells in whole lb's too. I appreciate it because I get a stock of specialty grains built up. Then I don't have to run out because I'm 1 oz short on chocolate malt - I just pull out my bag of spare choco.

- I'm going to play the devil's advocate: Maybe the LHBS'es rent is astronomically higher than the "other" LHBS, who is probably in a different suburb/neighborhood/etc. Maybe he HAS to charge those rates to keep his rent paid.

McKBrew said:

I will redefine my use of the word ****** to mean "poor business practice."

Evan!, as much as your economics posts p!ss me off, you are totally right. No one has to shop at the LHBS that is selling items at a price significantly more than the competition and it seems like many of us can agree that it's not the way we would personally run a business.

Take for example the gas station owners who raised the prices to $6/gal after Hurricane Katrina. Everyone called it price gouging, but in reality as long as people were willing to pay it, there was nothing wrong with it. Am I finally getting it?

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Price gouging is a term that describes raising prices on an item that everyone needs in order to survive in a market condition that literally forces you to buy regardless of price. Example: All roads are flooded out and the municipal water system is contaminated. You're a price gouger if you bought up all the bottled water in the area and then row your boat to each house with bottled water and charge $100 a gallon.

It is ironic that people condemn the basics of a capitalist system when the very life we live is so dependent on it.

tdavisii said:

Another opinion of mine is maybe we should just not take advantage of others just because of capitalism. Just because you can get away with it doesnt mean we should. On the other hand i hope our economy puts this guy out of business. I do agree with most of what you say bike n brew but at what point would you not back this high priced LHBS? At what point does it become just out right wrong?

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I don't think it ever becomes wrong. The alternative is Communism basically. Think of it this way, if the government stepped in and dictated at homebrew suppliers, or any consumer goods for that matter, could only profit 5%. How many businesses would close up shop because it's just not worth it to them? Capitalism has a pros and cons, but I submit that it has mostly pros and you have to swallow the cons to make it work.

My LHBS doesn't gouge on prices, but they limit how much you can get as far as hops go. Said they're lucky if the get 10 oz per shipment of stock. Last time I scored because the let me go over the limit by an ounce and a half because they'd have to break a package to do it, but they still sell for just over a dollar per ounce.

There's the only shop around, but considering online shops they still have plenty competition. They don't want to run regulars away.