The price is always right
Don't fear passing the Budget hikes on to customers, good ones remain loyal
On the morning of the Budget
I was slowly
roused to consciousness
by the sound of
John
Humphrys grumpily interviewing someone on
Radio 4 . As sleep fell away, I realised that
someone from the drinks industry
was getting
the rubber-hose treatment.
The interviewee was from JD
Wetherspoon (it
could have been chairman Tim Martin) and he was being quizzed about potential tax hikes , specifically the Conservatives' proposal to treble tax on "alcopops", and significantly raise it on strong beer and cider , to fund tax cuts on lower strength drinks.
The interviewee
said that this sort of thing didn't work, because then all you'll get is people bringing cheap booze in from Calais. This gave me the opportunity to start the day with a giggle, as I
recalled
being asked to go into a shop to buy some cigarettes for a couple of schoolkids (boy, did they
pick the wrong guy to ask) a few days ago. How disorienting might it have been if, rather than being stopped
buying some smokes, they'd offered me a
few grand to import a load of alcopops from France? "'Scuse, mister, but can you nip down to Dover and run a load of dodgy RTDs back for us?"
And they say the spirit of enterprise is dead.
Well, the proposed dramatic hikes in the Budget didn't materialise, although some increases
will sting a bit. There has been lively debate
on these pages lately (and elsewhere) . Some commentators
argue that on one hand customers will refuse to pay £2 for a bottle of local SIBA-affiliated ale, and on the other that we should welcome the Budget as a transparent and honest way to pass on price rises
to customers.
I'd like to relate my own experience of these two issues as an illustration of how price rises specifically, and expensive beer generally, might work out.
I'm thorough to the point of bloody-mindedness about passing on price rises , and there is a certain rapport to be gained with customers by cursing the Chancellor together. If a beer becomes more expensive to produce, then I wouldn't expect
a brewer to soak up
the cost, nor a wholesaler. The beer must come to market at a price that reflects its cost of production. Over the past year, beer prices have
been hit by the rising
costs of
raw materials and utilities . I've slowly edged the prices up on certain beers, always passing on price increases, but
believing that this would kill sales. But far from it, as
the beer
keeps selling, to a point where I'm surprised that people
remain loyal to a beer that has become disproportionately expensive compared to its quality.
Ditto for super-premium Belgian beers, selling for about
£15 in a
Champagne-style bottle. My initial
fear was
that it would
never sell. Not a bit of it -
when people ask me if it's worth
£15, I have to answer that I've tried it, it's
good, and enough people feel the same that it's worth
stocking.
Don't get me wrong . We sell a lot of Carling, Oranjeboom and Scrumpy Jack - in fact, if we didn't, then we might struggle to stay in business. But that doesn't stop us also selling Deus, Thomas Hardy Ale, and Brooklyn Black Chocolate Stout. Be bold. Branch out. Hold fast. You will be surprised at the results.
