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Monday, June 27, 2016

The Incredible, Shrinking Glassware


 An article by Fritz Hahn over on the Washington Post highlights a phenomenon to which I have been insensitive: shrinking glassware. (If I search my mind, I see that a dimly-dawning inkling of this phenomenon is present, but fetal.) Since I'm quoted in the article, I might as well comment on it.
But where craft beer is the focus, the pint is under threat. In the area’s beer bars and beer-focused restaurants, it has become next to impossible to find anything served in a 16-ounce glass. Go into ChurchKey, the Sovereign, Pizzeria Paradiso, City Tap House and RFD, and the scene resembles that notorious Budweiser ad: Guys swirling craft beers in snifters, pinkies aloft, because there’s no way to hold the stem of a nine-ounce snifter without your pinkie automatically popping out.
Hahn runs through some history of the pint and then comes to the key point.
The truth is, bars like smaller glasses because they create the illusion of lower-priced beer.... At Pizzeria Paradiso, at least a quarter of the beers sell for $5 and $6; the difference is they come in 12-ounce glasses. “Our goal at Pizzeria Paradiso has been to make craft beer more accessible, and that starts with the pricing,” says Fernands. Deciding to set beer prices by the ounce “allowed us to pick up more esoteric and expensive stuff, because we can put it in a smaller glass.”
Long ago, I made a quixotic charge at bringing clarity to glassware sizing by promoting the Honest Pint Project, and at the tail end of the article, Hahn mentions me and this. But what he's talking about is actual a new and different phenomenon. The Honest Pint Project was an effort to get publicans to serve a pint when they called a beer a "pint." What Hahn's identified is something else--keeping prices down by shrinking the size of the package. This has been going on for years in food packaging, and it makes sense it would come to beer, as well. People go to the store or pub and they expect a unit of goods to be roughly a certain price. Raising that price means the customer buys less, so if you can fudge the size and keep the price low, voila!--you've raised prices without alerting your customer.

If you buy a sixer of beer for ten bucks, you're getting your beer at about 14 cents an ounce. If you buy a pint of beer for five bucks, you're getting it for a bit more than twice that--31 cents. But if you buy a "glass" of beer, you have no idea how much you're paying.
Five Dollar Glasses
Imperial Pint - 26 cents/ounce
US Pint - 31 cents/ounce
12-ounce glass - 42 cents/ounce
8-ounce snifter - 63 cents/ounce

Six Dollar Glasses
Imperial Pint - 31 cents/ounce
US Pint - 38 cents/ounce
12-ounce glass - 50 cents/ounce
8-ounce snifter - 75 cents/ounce

Seven Dollar Glasses
Imperial Pint - 36 cents/ounce
US Pint - 44 cents/ounce
12-ounce glass - 58 cents/ounce
8-ounce snifter - 88 cents/ounce
 To the punter, the difference is a buck or two a pour. To the publican, it's a good deal more than that. If a pub pours imperial pints, the retail value of a standard keg at six-dollar pints is $619.50. If they're pouring US pints, it's $744. If they're pouring 12-ounce glasses, it's $992. Kegs come in different sizes and prices, and often publicans have to charge and arm and a leg. I'd love it if the US just backed away from standard pricing. I've never understood why you pay the same amount for a 4.5% kolsch as you do for a 7.5% IPA, which has twice the malt and many times the hops. If we got used to paying different amounts for a glass of beer, we'd be better consumers.

And in any case, it's worth at least thinking like better consumers. Imagine if a $6 US pint were a standard measure. This is what you'd expect to pay for the following measures if pricing were linear:
Imperial pint: $7.20
12-ounce glass: $4.50
8-ounce glass: $3.00
I actually love smaller glasses. I'd prefer it if ten-ounce glasses were offered everywhere, at roughly linear pricing. That would set me back about $4 a glass, and I could have four in a sitting for a reasonable price. Better yet, if pints of low-abv beer were cheaper, I'd buy more of those, too. So consider this a vote for both--cheaper small-pours and different prices per beer. There, it's only Monday and I've already solved your worst problems.


Unknown said...

If I were a publican, I might try honest pints for beers under 6 percent ABV, 12-oz. glasses for beers 6-7.9 percent ABV, and 8-oz. glasses for anything over 8 percent ABV. That would have the effect of leveling out the prices, too.

Joe Nagy said...

This is what I don't get about session IPAs. It's the same price per ounce and you know the grain bill was 2/3 the standard IPA.

Joe Nagy said...

This is what I don't get about session IPAs. It's the same price per ounce and you know the grain bill was 2/3 the standard IPA.

Chris, Notch Brewing said...

Ingredient cost is a fraction of the price of a pint. The difference in COGS is minimal, the price of labor, utilities, rent, taxes, packaging, wholesaler and retailer markups are all the same. For a $6 pint, the brewer is getting less than $1. Of that $1, ingredient cost is about $0.25. The difference between that 4.5% and 7.5% by the time it hits the consumer? about a nickel.

Jeff Alworth said...

Yes, ingredient costs are low, but you're conflating two things--cost to produce a beer and retail price. And the difference between a beer that costs a brewery twenty cents in ingredient costs per pint and forty cents is still 100%. When you start telescoping that out to the final price of the beer, it matters.

Let's compare apples and apples, please.

Brewers Union Local 180 said...

Rubbish! It's 20 oz., it's 3.7% and you drink 8 of them. Should cost around $5.50. Goes well with Cumberland Sausage and Mushy Peas.

Chris, Notch Brewing said...

Jeff, how? If my keg of 4.5 sells to my wholesaler at 110, and then my 7.5 sells to my wholesaler at 120, how does that make a significant difference at the bar. It doesn't, the difference goes into the pocket of the bar owner.

And if that doesn't work, how about the fact my session IPA has the same #/bbls of hops as a 7.5% IPA (not about bitterness anymore but aromatics and flavor), and then what if I use Golden Promise as a base malt instead of Canada Pils (2X the cost)? Most of my 4.5 beers have a HIGHER cost of goods than beers I made at 6 or 7 because I need to coax out flavor with every ingredient to make these beers special. Why are we so dismissive of the real costs being presented by commercial brewers who make session beer?

The reality is you (the consumer) were fed the "these beers are strong and cost lots of money to make" line by certain brewers looking to increase their margin on perceived quality and perceived expense. The consumer accepted this as fact, and it was a vast exaggeration.

Chris, Notch Brewing said...

And if we take your "100% more to make" which is 100% wrong, it still shakes out like this:

Jeff Alworth said...

There are two things here: what the pub sells the pint for, and what the brewery sells the keg for. Your cost is built into the $120. In your upper comment, you said the nickel difference is negligible in a $6 pint, but you're only making about a buck a pint yourself. It doesn't matter if the retailer charges $3 or $9 for that keg--you sold it to him for $120. When you talk about the nickel cost, it's against the dollar you mentioned.

I haven't had a chance to survey breweries to find out what their ingredient costs are, but depending on the beer--as you acknowledge--the price difference may be 100% for malt. Beers use radically different hop amounts, so you could be looking at 5x the cost or more depending on which beers you're comparing. That adds up to a lot more than a nickel difference. If the base beer--using your number--costs a quarter a pint in ingredients, then a cheaper one could be as little as 15 or 20 cents, and a more expensive one 30, 35, or 40 cents a pint.

I don't know, maybe that looks like negligible to you. "Even" the nickel you cite is 5% in profit. And it can become more than that. Big breweries will kill to reduce the cost of a pint by a fraction of a penny. That's not someone "feeding me a line," that's business.

I'm glad you're cool with it. I wouldn't expect every brewer to be.

Bill said...

Threadjack! I just stumbled across your doppelbock article focusing on Ayinger Celebrator. I've been drinking it since the 1980s and always have the "wow" experience at the first swallow. I had no idea they stopped decoction mashing. I can't say I ever detected any difference in the taste. A couple of years back I read an interview with Metropolitan Brewing's Doug Hurst on his doppelbock -- he uses an upward-step infusion mash. I wonder if this is what Ayinger does now?

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