Friday, 15 January 2010

What's Beer Worth?

Just a quick poll, aimed at take-home beer sold in bottle in the off-trade. It's meant to focus on independent retailers rather supermarkets, who can afford to make much smaller mark-ups.

Put simply, how much money does a retailer make for each averagely-priced bottle of beer they sell? You might prefer to answer with a comment rather than just clicking the poll. If you want to give %GP, you'll have to do that, I'm afraid.

Is price related to value? Does more expensive beer taste better, or just different?

And in the tradition of blog polls, what glaring omission have I made from the poll and the follow-up questions?


  1. From a brewery point of view, I know how to work out a price for us to sell regular cask beer, thats easy cost of materiales malt, hops, duty and stuff 60%GP. But for the special beer the beer thats been matured for longer and bottled? Bottling takes extra time so the GP increases, also adding bottles, caps and labels to the costs. But how far do we take it for the really special stuff.

  2. Stu - I think that if you have a good reputation, the sky's the limit. Marble had a queue of retailers waiting to buy their 75cl, cork-sealed, wax-dipped Special, which sold at retail for around £14.

  3. Any business that puts a standard mark-up on anything is just asking for trouble - not that I'm suggesting that is what you are saying. You sell at a price you think the market will stand for that particular product.

  4. yes I was looking at that one in your shop today and thinking I would never pay for a beer like that. I'm sure the beer is good but I do wonder if it could be cheaper. How much would they charge for the same beer in 330ml crown cap bottle?
    On the other hand I would like to produce a product like that my self, but could I charge that much my self without feeling like I'm ripping people off?
    How do Meantime do it? In it the higher volumes?

  5. "Any business that puts a standard mark-up on anything is just asking for trouble"

    Any business that doesn't put a fairly controlled mark up on everything is looking for trouble.

    What is anything worth - what people are willing to pay?

    How the hell do you calculate that? Not by guesswork...

    Oh by the way Stu I think you should definitely drop your prices, especially for me... I'll buy loads and won't feel ripped off in any way.

  6. "What is anything worth - what people are willing to pay? How the hell do you calculate that?"

    Yes and market research!

  7. I'm guessing your gross profit is not more than 50%. I'd like to think it is more than 37%. I voted accordingly.

    I believe very strongly in gross profit. If a product deserves a higher price then why should the producer not receive his share? If a product is rubbish and has to be sold at a lower price then the retailer should be offered it at a lower supply price. If a high cost item doesn't sell at the asking price, don't stock it - simple.

    The only exception to GP might be fixed cash mark-up. High value items still get the same number of pounds put on, making high value items more desirable. But product by product variations is balmy unless there is a volume benefit.

  8. Talking in generalities, we use a fixed range of mark-ups for beer, with different ones for wines and spirits. The GP for each product group is different, bound largely by market rates.

    I don't really understand people slavish adherence to overall GP. The margins on tobacco are tiny - about 7%GP if you stick to more-or-less market prices - so we could raise our overall GP very quickly by stopping selling tobacco. But then, that's a lot of 50p's that you say goodbye to at the drop of a hat.

  9. Perhaps that's one significant difference between on-sales and off-sales.

    Although I must admit we sell crisps at a lower GP and some spirits at a higher GP.......

  10. I voted 50p, because there wasn't an option for 10p


Sorry about the word verification - the blog was getting spammed to bits.