Thursday, October 09, 2014

Craft beer costs dissected.

This strikes me as a sensible explanation for a non-specialist readership. Thanks to BC for the link.

Here's How A Six-Pack Of Craft Beer Ends Up Costing $12, by Joe Satran (Huff Post)

I've said it before and I'll say it again: There's never been a better time to be a beer drinker in America. The skillful innovation of American craft brewers over the past decade has pushed beer in delicious new directions. It wouldn't be hard to argue that the craft beer renaissance is the most exciting development in the country's culinary world right now.

But this explosion in quality comes at a price. Literally. With few exceptions, prices for good craft beer are far higher than for mainstream macrobrews from brewing conglomerates such as MillerCoors and Anheuser-Busch. A six-pack of beer from breweries like Dogfish Head, Ballast Point or Cigar City almost always costs more than $10 -- and routinely exceeds the $15 mark. You could easily get a 12-pack of Bud Light for that much.

Part of the price differential is due to pure marketing. Like vendors of designer clothing, acclaimed craft breweries can charge more because their customers expect to pay more for luxury goods. I recently spoke with more than a dozen people involved at all levels of the craft beer world to get a sense of the industry's cost structure. It turns out that craft brewers incur far higher costs than mainstream brewers. Indeed, once you learn about all the work and material that goes into each six-pack, $12 starts to seem like a bargain.

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