Some breweries sell beer so cheap that it’s impossible for decent outfits to compete.
That’s an argument we’ve heard multiple times in the last couple of years, usually without naming names, because, as one brewer put it, ‘lawyers are expensive’.
At the more innocent end, it’s breweries making the cheapest beer possible, without particular regard for quality, hoping to scrape a profit by selling a lot of beer on narrow margins. We think that’s primarily what the then MD of Moorhouse’s was getting at here:
The ever increasing number of new brewers entering the growing cask-ale market, he says, has led to some ‘micros’ using Progressive Beer Duty (PBD) tax relief to sell beer at rock bottom price – rather than invest for the future. PBD, a sliding scale of duty, was introduced in 2002 to help small brewers compete.
Spend any amount of time in one area of the country or another and you’ll learn to spot the local bargain brewery: they’re the ones that always crop up in the pubs with FOR SALE signs outside, where the publican is on the phone having a pleading conversation with a creditor, with vultures circling. They’re fodder for Real Ale Pubs that can’t really afford to offer a choice of cask but also can’t afford not to, and that’s can’t get away with charging (ballpark) more than £3 a pint.
In our experience, though, this bargain beer might well taste fine, especially if it’s been looked after well and you’re prepared to accept straightforward over stunning. From the research we’ve been doing in the last year or two we’ve learned that the market has always demanded a range of price points, even at the price of quality: in Liverpool in the early 20th Century, for example, Bent’s was the bargain brewery whose beer was as rough as its pubs, and that served a need. And if cheap breweries disappeared overnight these pubs and their customers wouldn’t suddenly have lots of extra money to spend on painstakingly perfect ales full of Citra or Sorachi Ace — they’d just give up on ale altogether.
We don’t think there’s anything wrong with this, other than that, if you’re the kind of person that worries about The Industry or the health of cask ale culture, it doesn’t do much to win over those who find real ale bland and/or mildly unsavoury.
But then there are the suggestions of outright dodginess: selling beer off the books; offering two casks for the price of one; selling outdated beer, and so on. Dave Bailey of Hardknott expressed his frustration about that kind of thing here:
[Reduced scrutiny by government] is a clear signal to go ahead and pretend that beer is being destroyed, when in fact it is being sold ‘without paperwork’ for cash, no questions asked. Beer duty and VAT no doubt being evaded. I know quite a few business friends that think this is not only OK, but the only thing that can keep a business alive in a tough competitive time. After all, it’d be doing the beer drinker a service by getting the cost of their pint down.
Yvan Seth, who works as a beer distributor, commented on last week’s placeholding post with more of the same:
There are some out there who will offer you an extra cask, off the paperwork, as an incentive to put in an order. This is so clearly dodgy that the general suspicion is that these casks are off the books everywhere – no duty, no VAT, etc. And you probably have to be a bit dodgy yourself to even be offered this.
That really does sound bad, and clearly offers an unfair advantage, but if people in the industry know and seem to know who the culprits are (we don’t just mean Dave and Yvan — there’s lots of gossip on social media) we have to ask… Why is it still happening?