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Wednesday, October 15, 2014

"A Whores' Market"

Alan McLeod alerts us to a fascinating story on Esquire.
What’s “pay to play”? It’s when breweries bribe bars under the table to stock their beers and freeze out competition and is, according to the Alcohol and Tobacco Tax and Trade Bureau regulations, an illegal practice. [Pretty Things' Dann] Paquette even dared “name names,” accusing some popular Massachusetts’ joints such as Bukowski’s Tavern and The Lower Depths of accepting this dirty money. Paquette further noted, “Ever heard the term ‘committed lines’? This is what it means. Breweries buy draft lines so their lame beers aren't irrelevant.” He didn’t name any of these “lame” breweries though he hinted at one, saying “Right now one of the hottest newish brewers in MA pays for lines all over the place....”

But, in fact, it’s not just Massachusetts where this is a major issue. In 2010, a Crain’s investigation found that a trendy Chicago hotel bar had been taking payouts and other bribes from a powerful MillerCoors distributor. Deb Carey of New Glarus Brewing went so far as to call the city of Chicago “a whores' market,” noting, “Everyone has a hand out and everyone wants some cash, (free) beer or a discount.”
I have no idea whether this is a real thing or not.  Accusations are not facts.  Much as Dann Paquette is respected by beer geeks, this is nothing but rumor-mongering.  Based on the reactions, I have a strong suspicion it is happening--but I wish Dann had some actual evidence to offer.  The issue is a rich one, and if you want to get a sampling of opinion the issue has sparked, look here

I'm interested in informed thought on this, as well as straight-from-the-arse opinion.  I only have the latter, but to get a conversation started, here it is.  Although this practice sounds bad, I wonder how big a problem it actually is, at least in mature markets.  In towns along the West Coast (and I suspect this applies to Boston, too), pubs would be making a poor decision to take uninteresting beers along with a small handout.  The competition among bars is such that those offering anodyne choices aren't going to attract many customers.  It doesn't really matter how much a brewery is paying you under the table if no one's coming to drink your beer.  Seems like the market would be self-correcting.

If anyone has had direct experience with this and wants to chat on or off the record, you can shoot me an email at the_beerax (at)

Your thoughts?


  1. Isn't it very possible this is way more widespread? I mean, what if a brewery with good and interesting beers was doing the same thing? It's obvious when there is a low quality beer at a place with generally high standards, but if the quality is there the customer base probably wouldn't notice, right? I'm not saying it shouldn't be illegal or we shouldn't care, just speaking to the point of how widespread the issue COULD be - we really have no idea unless a brewery complains, as Pretty Things did.

    It seems to me - at least, in Portland - there are plenty of places to go with great taps. If some pub is committing a line to something lower quality or uninteresting, people will notice. If they do it too much, people are just going to go somewhere else...but customers only notice if there is something seemingly out of whack with the offerings. (A "one of these is not like the other" kind of thing.)

  2. Interesting read. I have heard about bars here in Colorado having "committed lines" where they only stock beers from a certain distributor...almost the same.

  3. My comment was initially eaten by blogger, so I apologize for my ineloquant recreation.

    I have not experienced or have heard any stories of payola in Portland. However, I’ve been told several anecdotes about this practice happening in other markets, especially Chicago. Obviously, there’s incentive to keep things quiet, but there is a surprising level of acceptance in some places (once again, Chicago).

    Part of the liquor privatization ballot measure that was pulled from the November election included a payola provision where groceries were allowed to accept cash payments and other incentives in exchange for access to shelf space. While this did not apply to beer it still frightened craft brewers and the Oregon Brewers Guild as it would leave the door ajar for a future push for a similar practice in the beer world.

    Committed lines do happen, but it’s not nefarious like in other areas. A bar manager might stock a certain brewery or distributor based on personal preference, superior service or other intangibles. For example, there’s a bar in NE that almost exclusively stocks a certain distributor because the distributor’s warehouse is located nearby and the staff all drink at the bar after work.

    Unfortunately, this is what happens in a competitive marketplace where suppliers are growing faster than shelf and tap space. An educated and passionate consumer base could fight against dirty tactics, as noted “It doesn't really matter how much a brewery is paying you under the table if no one's coming to drink your beer.” But I do think we will start seeing chinks in the industry wide camaraderie as more breweries open, some of which will be started by opportunistic people looking to strike gold.

  4. There is another comment I forgot to add:

    There is a backward pay to play approach some larger craft breweries have taken. In this case, a brewery will provide a cash incentive to distributor's sales reps for each competitors tap handle they acquire. This type of head hunting has happened in Portland, unfortunately.

  5. "pubs would be making a poor decision to take uninteresting beers along with a small handout." I think that the point that Paquette is making, is that craft brewers are going along with payola as well, and it isn't just simply uninteresting beers. In a market where every bar refuses new beer unless there is a cash offer, it doesn't matter how interesting your beer is. This is why Paquette mentions that Pretty Things can not easily be found on draft.
    And even if it is only mediocre craft brewers offering money, it is not necessarily bad for business if the bar has some other incentive to entice consumers. Location is a great example; i.e. downtown or near sports arenas. Customer will show up anyways out of convenience and drink whatever is available because it is their only option.

  6. The key word here is "uninteresting". According to whom? Based on what standards?

    Not defending the practice, mind you, but has anyone asked those pub owners how business has been going? What if people go to those pubs not so much for the beer they sell, but for the place itself? Would that be a poor decision in that case?

  7. For obvious reasons I can't name names, but I know a few people who've worked for beer distributors along the East Coast, and I can assure you - with 100% certainty - this DOES happen, and quite a bit. Obviously I'm not at liberty to elaborate on it and I can't provide evidence to support my statement, but stories like this one are nothing new.

  8. This comment has been removed by the author.

  9. To Pivní Filosof's point.
    I tend to choose a convivial drinking establishment
    - with good beer selection
    - where friends gather
    over an establishment
    - with the most sought after beers
    - poser clientele.
    [I deleted to expand].

  10. There's a bar here in Salem that had a dedicated line back when I blogged. I was always told they had a great rotating craft selection so I thought I'd try it. They had the typical bud lineup and a separate row of taps with seasonals from Widmer and and some Kona beers. I asked about the rotation of craft beers and was told they rotated only Widmer and Kona through exclusively. I asked about them possibly getting other beers and was informed that they only carried those brands. Later they did make the decision to add a couple other craft brands with their own exclusive lines, but no rotation. I've seen other bars do this as well.

    That being said, it could just be that these owners have been slow to adopt beers outside their normal lineups. It does raise an interesting idea that it could be pay to play as well. It definitely hasn't hurt these bars to have tied lines. They tend to have great happy hour specials that draw in the heavy drinking crowd.