Curmudgeon's "Opening Times" Column - September 2002
If real ale is better than keg, why canít it command a price premium?
In most consumer markets, itís broadly true that the more you pay, the better the quality you get. But, when you go in the pub, even though CAMRA tell you that real ale is far better than keg, itís normally the cheapest draught beer on the bar. To a large extent this is historical, because many years ago all pubs sold real ale, and when keg beers and lagers were introduced they were priced higher because they were novelties.
Real ale is also often not as consistent as it should be, and people are understandably reluctant to pay high prices when they canít be guaranteed a good pint. And it must be remembered that most of the price differentials you find at the bar come from the mark-ups applied by the wholesaler and the licensee - the actual production costs of the finest craft-brewed ales are only a few pence a pint more than for industrial keg of the same alcoholic strength.
But being perceived as cheap really does real ale no favours. If it is to have a healthy future and appeal to new drinkers, it wonít be as something that sells principally on low price, but as a product that people make a positive choice to drink because itís far tastier than mass-produced beers, and, yes, can command a higher price at the bar because itís better.
However, as manufacturers in other fields have found to their cost in the past, you canít charge a premium for your product until you can guarantee the quality to match it. If real ale producers and retailers simply put their prices up without addressing any of the issues of presentation and consistency, all theyíll do is destroy their existing business.
Some people who cherish real ale as a ďvalue for moneyĒ product for the working man may be disturbed by this, but itís already happening. Many beer enthusiasts choose to drink where real ale sells for well above the average, because those are pubs which make the effort to obtain an ever-changing range of interesting guest beers and keep them in good condition.
Consumers decide whether prices are reasonable by their choice of where to drink
The trouble is, people then grumble that the prices charged by those particular pubs are in some way unfair. But who says whether prices are fair or not? Do they want someone in a government department to go through the books of every business with a fine toothcomb to decide whether their mark-ups are acceptable?
If we were discussing a monopoly supplier of an essential commodity, the concept of a fair, affordable price might be relevant. But in a competitive market the only person who can decide whether prices are reasonable is the consumer him- or herself. If you think a particular price is excessive, the remedy is in your own hands. If you don't like it, don't pay it and take your business elsewhere. Thereís an enormous variety of excellent beer available in both Stockport and Manchester for well under £2 a pint, much of it below £1.50. Though if you choose to avoid a busy pub where others obviously have no problem with the prices, you may end up cutting off your nose to spite your face.