Price and specialty

When we learned of the acquisition of a stake in Nómada Brewing Co by Grupo Mahou-San Miguel, it was not difficult to imagine that a new scenario for the entire local brewing industry was about to start. As expected by some of us, it was a matter of time until we knew of further acquisitions by the big guys -La Virgen by ABI, Sagra by MolsonCoors- but possibly one of the side effects that has immediately begun to be noticeable is a decrease in the price of beer.

"Who benefits from the new margin created by the drop of wholesale prices in beer?"

A relevant part of the specialised bars has given the tacit approval to the operation of Nómada, and to their new beers, offering in its dependencies one or more taps with them. Of course, and in line with what was mentioned in the introduction, one of their strengths is the value for money of the products: the qualitative leap that many of the previous beer have undergone is undeniable, and the new recipes have been widely appreciated by the public. To which it is necessary to add an attractive price per keg for bar managers, and a quality distribution service that respects the cold chain.

Nómada, La Virgen and Sagra are part of most beer boards in Madrid.

In this sense, although outside of their original market, I would not be surprised that at some point La Virgen and Sagra appeared in the Barcelona market with a similar strategy, being as it is the most attractive market for this type of product today, now that both companies are in the process of 'craftising' their product -not in the sense of artisan or handmade, but in linking their image to modernity-. Proof of this is the rescue of old limited edition recipes, or even new products which are far more daring than the original portfolio of both brands, which paradoxically innovate more once acquired by a large brewing holding than in their previous stage as an independent company.

And what about the craft brewers? Despite pointing to a new scenario in the first paragraph, the current price decline is in fact something that had already begun to occur, but the macro-market movements have accelerated it. The professionalisation of the sector has resulted in more operationally efficient companies, with an increasing quality of the product and with the awareness that the price has always been an important element, but that in the future will be fundamental. It is easy to think, at this point, about Arriaca. Also, some breweries like Dougall's, to mention a paradigmatic example, have always maintained a strategy of very competitive prices for products of the highest quality: they have been doing all right, and they will surely continue to do so.

Meanwhile, in Barcelona, ​​Edge Brewing released last year Voilà, a beer that presents attractive wholesale prices and which is, in turn, the house beer in some establishments, in which I have even had a pint of this exceptional Blonde Ale for less than 4 euros. Then they say that 'craft beer' is always expensive. The recent emergence of Tibidabo Brewing, the new brewery in l'Hospitalet, is also revolutionising the taps of the bars in Barcelona thanks to a very attractive offer of craft-style beers plus good prices.

No way to check it, but this is an Edge Voilà. Quality plus price.

I have written several times -here or here- about the need for breweries to have a core range of products. Considering all of the above-mentioned changes in the market, and now more than ever, it will be key to understand the difference between business and entertainment, between moderation and ground breaking, between selling litres and setting one's character. Between price and specialty. Quality, of course, is already taken for granted at this point.

Of course, a few breweries will live off of specialty, given the personality of their products and / or the very idiosyncrasy of their brand. But the rest of them, if they want to leave their more immediately local markets -specialising at a local level is another good and valid strategy today-, should look for that difficult but basic balance between price and specialty, be it with intermediate products or with multiple product ranges. And, with their base product, penetrate the generalist bars and restaurants with a quality and values ​​that are already slowly penetrating these places... thanks of course to a price that fits them, and given the consumers' approval.

Just take a look at what Brewdog did 4 years ago: they clearly defined its core range of beers, and made them a less daring product than it was, more accessible to the general public. In parallel, they were releasing other beers, many of them limited editions, more in line with the bold image that the guys from Ellon have always wanted to link to their brewery. Punk IPA, the blank of criticism for many given its iconic quality, went from an unabashed IPA to a highly drinkable APA in the process. Hardcore IPA, adored by many drinkers among whom I include myself, was definitely buried a few months ago, staying in no man's land as a product: neither suitable for all palates nor special, already in 2017, as a well done Double IPA.

Other times...

Leaving aside whether we like or not the way the Scots have taken in recent years, which in this time have gone from being the craft fan favourite brewery to the target of all kinds of viciousness by a relevant part of those, the truth is that their beers are found today in both general establishments, in the case of its base range, and in specialised stores part of those same beers, alongside other more unique and exclusive products.

But the next step is to see who benefits from this additional margin that is created with this current reality of prices and ranges. There are many breweries that, selling their beers at good prices, have been seeing how their effort is invested in lowering the price of more expensive beers, with whom they share the board in some bars. And right in the middle of this we find the consumer, who does not have to know the bowels of the industry, but to whom a little additional information and transparency would surely make more aware of what he is paying, and where that money goes.

Salut i birra!


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