Some brewers, including Boston Beer Company brewers of Sam Adams are threatening price increases.
Beer retailers around Chicago received a notice last Friday from The Boston Beer company outlining price increases on their products to take effect in February of 2012. To justify these increases, they cite a 68% rise in the cost of barley.
To be very clear, we are talking about a retail increase of one dollar per six pack and one dollar per twelve pack. That is a substantial increase.
Boston Beer Company suggests that the prices of other domestics will reflect increased commodity costs to a lesser extent. They defend their higher increases by pointing out their higher barley content per bottle.
Boston Beer Company also lists identical per case price increases on their other major product: Twisted Tea. We weren’t aware that Twisted Tea was such a high gravity flavored malt beverage.
We do believe that the costs of commodities such as barley are rising, but we think it is disingenuous to use them justify excessive, across-the board price increases.
These increases aren’t being dictated by cost alone. They are driven by market research and price elasticity of demand. We would prefer the honest truth, that they think consumers will pay more for their product because it is good.
Why should you care? Like it or not, Sam Adams sets the industry standard for craft beer, and this move will be reflected in price tags up and down the beer aisle from other national brands to all your favorite local micros.