The price of 33cl bottles in supermarkets

Geuze

I am interested in the ongoing deflation in beer prices.

The prices of cases of 275ml / 30cl / 33cl bottles seems to have dropped a lot over the last five years.

I have got used to 24 euro for 24 bottles, especially for lesser known brands.

But last week I heard of 20 Heineken for 15 euro, that's 75c per bottle.

A few points:

(1) How can it be so cheap, after VAT, excise, retail margins, etc.?

(2) Why would anybody go north to buy beer at this prices in RoI?

(3) Why are pub prices for 33cl bottles still so high?


Ok, so I will now strip the VAT and excise out of that 75c price. It's 62c pre-VAT.

Excise duty rates are here: http://www.revenue.ie/en/tax/excise/duties/excise-duty-rates.html

So it's 15.71 per % per 100 litres. That's 5.24 cent per % strength.

I assume 4.3%, so that makes it 22.5 cent.

So it's 40 cent ex-VAT and duty.

Out of the 40c must come the retail margin, the transport costs, a wholesaler (???) and the supplier cost.

Geuze

If the shop can sell it at 75c, surely a pub could sell at 3.00??

irishcrazyhorse

Firstly the supermarkets are buying in bigger bulk,alot bigger bulk, secondly a bar still has bigger overheads ie. skysports/bouncers/insurance etc...

BeerNut

Geuze wrote: »

(1) How can it be so cheap, after VAT, excise, retail margins, etc.?

The supermarkets are selling it below cost, something that was illegal until a few years ago.

Geuze wrote: »

(3) Why are pub prices for 33cl bottles still so high?

Lack of competition. The supermarkets fight each other for the cheapest beers; the pubs don't want to play that game, and as long as the bottled beer continues to sell for €5 a go, they don't have to.

guildofevil

Geuze wrote: »

(1) How can it be so cheap, after VAT, excise, retail margins, etc.?

Heineken brew massive quantities of beer with an efficiency born of generations of penny pinching accountants looking over the brewers shoulder. They also have huge economies of scale and can demand incredibly low prices from their suppliers. Result: they can make beer for buttons.

Supermarkets have huge buying power and can demand incredibly low prices from their suppliers, in this case Heineken. Supermarkets may not actually make any money on the beer at all, relying on the low price brining you into the shop so they can sell you other stuff as well.

Geuze wrote: »

(2) Why would anybody go north to buy beer at this prices in RoI?

Ya got me there. Do people still do that now that?

Geuze wrote: »

(3) Why are pub prices for 33cl bottles still so high?

Pubs don't have anywhere near the purchasing power of supermarkets. If they try to negotiate a lower price they are simply told no. What are they going to do? Not buy Heineken? I have heard of publicans complaining that the price of a bottle of Heineken can be cheaper in a supermarket than from their wholesale supplier. They also have higher overheads, as they have to provide seating, security, toilets, glasses and dispose of the bottles when you are finished with them and they have to make their money on the beer as you won't be buying your weeks shopping from them while you are there.

I'm not saying their margins are realistic, especially for 33cl bottles, but that doesn't mean they are in the same economic place as your local supermarket.

I don't know why people compare pub beer prices to supermarket beer prices anyway. Would you compare the price of a Pizza in a restaurant to a special offer one in Tesco? Ever bought a steak out? What a rip-off compared to the butchers Tuesday special. What about coffee? You could buy a bag of ground coffee for the price of two cups in a café or sandwich place.

guildofevil

BeerNut wrote: »

The supermarkets are selling it below cost, something that was illegal until a few years ago.

Was beer covered by the groceries order? I didn't think it was.

BeerNut

guildofevil wrote: »

Was beer covered by the groceries order? I didn't think it was.

It was:

Restrictive Practices (Groceries) Order, 1987 wrote:

"grocery goods" means grocery goods for human consumption (excluding fresh fruit, fresh vegetables, fresh and frozen meat, fresh fish and frozen fish which has undergone no processing other than freezing with or without the addition of preservatives) and intoxicating liquors not for consumption on the premises and such household necessaries (other than foodstuffs) as are ordinarily sold in grocery shops, and includes grocery goods designated as "own label", "generic" or other similar description;

guildofevil wrote: »

they can make beer for buttons

But advertising it costs a fortune :P

Trampas

i have seen pubs selling beer they have bought in supemarkets

rubadub

guildofevil wrote: »

I don't know why people compare pub beer prices to supermarket beer prices anyway. Would you compare the price of a Pizza in a restaurant to a special offer one in Tesco? Ever bought a steak out? What a rip-off compared to the butchers Tuesday special. What about coffee? You could buy a bag of ground coffee for the price of two cups in a café or sandwich place.

I would compare many of those things, and know many people who do too. But stick to fair comparisons, your butcher is not a trained chef cooking up up a fine steak & veg for you. A longneck of beer has no value added to it besides the surroundings, you might be lucky if the bottle is even chilled and if you get offered a clean cold glass with it.

The proper comparison is the selling of identical prepackaged foods, no real value added. Take the longneck €5 vs 75cent, 7 times the price. I think a typical chocolate bar is 80cent in supermarkets, if I was in a cafe (availing of surroundings like a pub) and was charged €5.60 for a standard mars bar I would think it is excessive and it is a much fairer comparison, the item is the exact same as if I had bought it elsewhere.

The price of longnecks is out of line with other drinks. There was a thread with a guy moaning about being charged a euro or something for a pint of miwadi in a pub, I was pointing out this is a very good price when compared to other drink prices.

People will discuss the other comparisions you listed too though. Coffee is said to cost about 10-20cent per cup and in many cases, it is quite hard to get a good cup of coffee too, so many resort to just making their own -it being far better what they can get in the cafe next door to work. Takeaway pizza prices are completely out of line with Chinese food takeaway prices. I get 2 feeds from a €7.40 chinese takeaway, it would cost me €20-25 or so for the same feed from a pizza place, and the ingredients probably cost less for the pizza.

Dicey Rileys can do €2 drinks (including more expensive ones like pints of Paulaner) on wednesdays, many pubs have cheaper drink offers.

Technocentral

guildofevil "Heineken brew massive quantities of beer Result: they can make beer for buttons "

And it tastes like it was made for nothing to. No money or skill goes into improving the taste of the god awful macro brews and all into multimillion euro ad campaigns to sell it to the gullible masses who see beer either as wanky lifestyle accessories. (Rugby = Heino,) or think freezing cold Budweiser is a great innovation in taste.

BeerNut

Technocentral wrote: »

No money or skill goes into improving the taste of the god awful macro brews

I disagree. Malt, hops and yeast are major creators of flavour. It takes massive investment and highly trained skilled brewers to prevent them from doing so. It's hard to argue with the quality of Heineken and Bud if you go by their definition of quality: tasting, consistently, of as little as possible.