Monday, 2 January 2017

Passion proves no match for capitalism

Twitter has been all a flutter over the decision of Cloudwater, a well financed but loss making brewery, to stop selling its least profitable beers and focus on its most profitable beers. That it's cask beers getting the chop at the expense of keg and small pack has caused the kerfuffle.

The brewery was quite open about the financial reasoning behind their decision, though did throw in some minor cask beer denigrating for good measure. The large twitter response has in the main been people saying what they usually say, including those old favourites "We should pay more for beer" and "It's CAMRA's fault".

As I've a definite fondness for money in my own pocket rather than someone else's I've little time for the argument we should pay more. Those that feel they should be paying more can always send the brewery a donation, I'm sure they'll be happy to receive it.

As to blaming CAMRA, it seems just a little ludicrous to blame the Campaign for Real Ale for a brewery deciding to stop making real ale. The argument was tied in to the previous one, saying it's CAMRA fault that cask beer is too cheap.  I've seen little evidence of that myself, and cask beer has always been cheaper than industrial keg beer, let alone the pricey craft stuff. A situation I'm entirely happy with.

One point that was more interesting though was "What about the children?". If youths are drinking craft keg what will this do to the future of cask beer? Now I can see the concern here, but I'm sure youths drinking craft beer are more likely to drink cask ale at times than if they were drinking alcopops or keg lager. And as they get older they might well appreciate weaker and more balanced beers more anyway.

Though it is sad to see Cloudwater condemn their immortal souls to the fiery pit, let's face it, this side of libertarian communism you can't get away from the need to make money. In fact I've even recommended that people look into kegging myself. But I think we all know in our heart of hearts that cask beer is how god intended beer to be served. Or as Cloudwater put it when they announced they were going to stop making it: "Cask beer should take pride of place in every bar and pub".


  1. Surely if cask beer took "pride of place" in every bar and pub then customers would also be willing to pay a little more for it.

  2. That cask beer is cheaper than keg beer is proof that god loves us and wants us to be happpy. Who am I to question god's will?

  3. I can't imagine a series of events that starts with "beer journalists urge that customers should be happy to pay more for cask" and ends with "beer drinkers in general are happy to pay more for cask, making it possible for cask prices to rise substantially with no loss of volume". Since there's no feasible way for it to happen, debating whether it should happen is a bit pointless.

    1. I must admit I'd been thinking along similar lines myself. "To increase cask beer production we have to make it more expensive" seems a bit of a non-starter.

    2. Yes, all this blether about pricing conveniently ignores the fact that most people have a finite amount of money (more or less) to spend on beer. If prices went up to match keg beers (say a 25% to 30% increase) then volumes would drop.

  4. In most products you are not paying for the commodity components, you are paying for the amount of labour that it contains. Man hours.

    From cars to furniture to clothes.

    Therefore the distinction isn't cask or keg, but the degree of "craft"

    If a pint of beer contains more man hours then you'd expect it to be pricier yeh?

    The mass produced beer I like should be cheap. The microbrewed pong you lot neck contains more manual labour. It gets a tax break, sure, but aren't you all discerning enthusiasts that value this artisinal stuff?

  5. Everything is price-elastic to some extent. If you raise the price of a pint from £3.20 to £3.50, some people will take it in their stride. But others will switch to a cheaper product, drink a bit less or even stop going entirely.

    And it must be remembered that the quality of cask beer is critically dependent on turnover. Anything that reduces demand is also likely to have an adverse impact on quality.

  6. A featurew not pulled out of the Cloudwater blog was the wastage rates. That they chuck 15-25% of their product? I read that right yeh?

    What other manufacturing process has that much wastage of input costs? Is that a craft norm?

    1. Our losses are rather lower (but we don't dry hop like they do) maybe 6-10% on cask, 12-14% on bottled beers. Joiners will typically waste more than 10%, can be much higher (Depends on job) I seem to remember carpet fitters generally allow something like 20% for waste (again, depends on job). It's not the input costs that are the killer - labour, overheads and taxes are what get you. Course, big brewers have opportunities for reducing loss that aren't available to little guys.

    2. ... yes, I know carpet fitting is more of a service. How about this then: The food supply chain is estimated to lose about 25% overall. Even big (and I mean BIG) milk packagers lose 3% - goes up to 6% if you include cheese. mmm, cheese.

    3. I must look into what loss rates industrial brewers can get down too.

    4. Isn't this part of the argument for brewing over-strength and then making up with water?

    5. That's usually talked of in terms of getting better use out of the existing vessels: more beer without having to expand the brewery. I really must do a post on high gravity brewing as it's another thing that confuses people. and it often gets mixed up with liquoring back.

    6. Yeah, sure, but, if you have (say) 10% losses before final packaging, while that beer is only (say) 75% of the final product, then that loss as a fraction of final product is down to [does sums] 8.3% Is it?

      Yes. do that post.

    7. Be interesting to compare wastage rates at industrial / craft brewers.

      My guess is the mechanised production lines of Ford, VW etc don't bin off 20% of the cars. Though there may be wastage in off cuts of cloth, plastics etc.

      What you saw about the carpet fitter is basically the punter pays for a square of carpet and its cut to fit a none square room and the off cut is waste. Well yeh, and it's priced in as the punter pays for that.

      As the punter pays for the food the supermarket chucks out, ultimately.

      I guess tight control over this is one feature allowing Aldi to undercut Sainsburys.

      But this waste is one factor. Ultimately a labour intensive process has to produce something of higher value to an automated process or else the labour isn't adding value.

      Jon has to produce a beer of higher value to the customer than the macro brewery producing hectolitres with a man knowing when to press the green button.

  7. "Those that feel they should be paying more can always send the brewery a donation"

    Crowdfunding in a nutshell ;)

  8. "But I think we all know in our heart of hearts that cask beer is how god intended beer to be served."

    I do wonder if a cask fanatical crowd under-estimate the appeal of keg to the wider population, or younger population perhaps.

    There is first a simple fact that more people drink keg products in the UK than drink cask. Sure, very bland stuff, mostly larger... but we don't see them complaining about how difficult their "fizzy beer" is to drink. (Admittedly UK lager is generally rather low carb at around 2.2 vol CO2.)

    On moving to the UK 10 years ago, after some fumblings with both really awful cask and really dull keg I "discovered" cask ale... and it was good. (If you know the right pubs, etc.) I bought into it entirely, became a CAMRA member, even a branch committee member. And I look back fondly on this. It was an unavoidably, enjoyable, and important part in my "beer journey". (Ick.)

    I still love cask beer.

    But I love a good keg beer better. Heathen that I am. I have turned aside from your god and cannot help but be compelled by the devil's brew.

    This does not mean I hate cask of course. I just find my mileage is better if I drink tasty flavourful "craft" keg beers. And whilst now and then I do find some "craft" cask that is as enjoyable as the best of keg to me, it is not the norm alas.

    I am just one data-point of course. And a particularly twisted and defective example of the human lifeform at that.

    But I see the same in others... I know others who would once have put cask ahead of keg who've had a shift in perception. It's still a small data-set.

    Now you can say I'm wrong all you like, that my tastes are flawed, etc, etc... but like you, I like what I like. And I'm not the only one.

    Does it present a danger to cask? Not in the short run... the vast majority of breweries brew cask ale. And aren't about to invest in keg any time soon. Most free-of-tie volume is for cask ale too. But change is a slow beast... about 70 (?) years ago mild was the most popular type of beer there was right? Where will we be at 70 years from now... (probably a radioactive smudge on the landscape...hey ho.)

    (But it may well be keg breweries over-estimate the appeal of keg and the cask-fanaticals will be proven right in the long run.)

    1. Virtually all mainstream keg ale in the UK is now nitro which isn't really fizzy at all.

      People have forgotten just how gassy and burpy old-style keg was.

    2. Oh, I wasn't even considering keg "ale"... different beast entirely... 1.4 vol CO2 if you're lucky. Then shoved through a restrictor pale (sparker) to make it flatter. Does anyone except National Rail employees even drink the stuff? (Well the numbers say people drink it in a non-insignificant volume... so yeah, I suppose there are others drinking the stuff somewhere.)

      Keg ale market, like the cask ale market, is small compared to keg "lager" volumes. Which is more what I had in mind when I mentioned "fizzy" beer.

      Most draught beer drinkers in the UK do not mind carbonation levels above 2.2 vol CO2. (And on the contrary get quite upset if they lager seems "flat").

    3. There have been some rather 'in the beer bubble' comments going round of late. When people don't stick the word 'craft' in front of keg they can make some strange statements. I'm sure I saw someone say 'more cask beer is drunk than keg' recently. And of course more beer is drunk in small pack than draught too.

      Your apostasy will condemn you to an eternity of torment though I'm afraid, but I wouldn't base business decisions entirely on my own personal preferences. Breweries really need to consider kegs and cans as well as casks and bottles.

    4. More cask *ale* is now drunk than keg *ale*, which wasn't the case ten years ago.

    5. @Curmudgeon Wasn't disputing that and it's not really relevant to the point I was making. That being that a majority of the beer volume consumed in pubs is what cask ale folk call "fizzy" but folk don't particularly complain about fizz unless they're the minority cask ale drinkers. My point there is "fizz" is not something that most humans have such a huge hatred of is all. I think a lot of cask drinkers drink cask because it is tastier, not because it tends towards being flat. Those I know, those my age at least. Fizz isn't going to be a thing that turns folk wanting to drink tasty beer off drinking keg... fizz is quite pleasant really. (But I don't quaff vast volumes of pints in a hurry.)

      Yes keg "ale" is in decline... true, the John Smiths and Boddingtons drinkers are a dying breed. (Where does Guinness fall in the classifications?) Cask is declining less-fast at the moment, not suffering as badly. But cask volumes were *down* on the previous year in the last cask report. (Nothing deathly dire... but they've also hardly been in worthwhile growth in recent previous years.)

      @Ed I am nothing even close to saying more "craft keg" is consumed than "cask ale" or anything along those lines. "Craft keg", as I see it, is presently a microscopically tiny niche compared to the fairly large niche market that is cask. I am saying more keg (lager if you prefer) is consumed than ale (both keg and cask ale) - and by that observation saying the aversion to "fizz" is not an obvious natural human condition. (I'm also not saying that because a large majority prefer to drink lager that a larger majority would prefer to drink "craft keg".)

      What the market will look like in 70 years is anybody's guess is my final point. Small trends now could become dominant forces over coming decades. I think we can at least agree things are unlikely to remain unchanged.