Thursday 4 June 2009

How much do pubs pay for our beer?

With prices almost hitting £3 a pint in some pubs, it would be interesting to see how much pubs actually buy there beer in at. Large pub companies such as Punch or Enterprise have huge buying in power, i.e., they can bulk buy beer in, unfortunately they then add a premium onto the barrel when they sell it on to their tenant in the pub. But how much do they actually pay to buy in the beer in the first place? Well brewers are naturally secretive about their wholesale prices with regards to pub companies and of course the pub companies themselves will not let on how much they buy beer in for. A friendly manager at a JD Wetherspoons (yes there are some Brew Wales still corresponds with) passed on their buying in prices which make interesting reading:

ABV Beer Price 9 Gallons

3.7% O'Hanlons Firefly £40.23

3.7% Caledonian Deuchars IPA £47.10

4.0% ABV Butcombe Bitter £43.50

4.4% Sharps Own £44.12

4.5% Brains Rev James £44.79

4.7% Exe Valley Devon Gold £47.50

4.8% Harviestoun Schiehallion £58.03

5.0% Stonehenge Danish Dynamite £50.00

There are a lot more on the price list but this gives you the idea of the amount a pub co such JD Wetherspoon pays brewers for their beers. Now JDW have around 700 pubs, pub companies such as Punch have around 9000 pubs and Enterprise have around 7000 so just imagine the discounts the pub companies are able to achieve from brewers with such large bulk buying power. A few months ago when JD Wetherspoon were selling Greene King IPA at 99p a pint, one Enterprise tenant told Brew Wales that that he could not even buy the beer in at that price so how was he supposed to compete with Wetherspoons? Which is the big problem. The only way for the pubs owned by the pub companies to compete with and even to survive against the alcohol warehouses filled with Chavs that dominate our city centres would be for a relaxation of the beer tie for pubs owned by the pub cos, which would allow these tied pubs to compete more fairly with other establishments. After all it is in the best interests of everyone to see pubs flourish, at the moment in Newport City Centre the company that puts metal gratings onto pub windows seems to be doing a very good trade! An empty, derelict building is doing nothing for the City, yet if that pub were allowed to compete in a fair and open market then it is highly unlikely it would have closed in the first place.

The Business and Enterprise Committee have recommended the Pub Co model be investigated by the Competition Commission and the Chief Executive of Punch Taverns, Giles Thorley, has written to Members of Parliament arguing that an investigation into the beer tie would be “a waste of time and resources”.

Well he would say that, wouldn't he.

The Publican have a few comments on the statement made by Giles Thorley here.

CAMRA have announced that they will be launching a 'super complaint' on the beer tie with the Office of Fair Trading by the end of June.


Anonymous said...

Don't know if this counts but Cotton Club and Seven have now closed.. Prince of Wales is now open Weekend sonly and the place two doors down from it has closed

Brew Wales said...

Its (or was) the White Hart a few doors away from the Prince.

Brew Wales said...

Correction! Its the Golden Hart near the Prince on Cardiff Road.

Vod said...

re buying in prices, I've recently seen the prices that Enterprise are charging their tenants for beer ordered via the SIBA direct delivery scheme. Double the McSpoons prices you gave above & you're about in the right ball park!


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