An artisanally crafted blog curated by Cooking Lager for discerning readers of beer bloggery

Monday, 29 March 2010

I love supermarkets

I was about to write up my views on an interesting bottle of lout I necked over the weekend, but I’m going to leave that till tomorrow.

My thanks must go to Roger Protz for enlightening me on his Blog and doing me the courtesy of answering a question I posed. He gets a lot of flack in the blogosphere does Rog, but I like the guy and enjoy his blog. The answer can be found here. Rog is the daddy, have some respect.

Now I make no claim to know the ins and outs of the pub trade. I am reasonably knowledgeable in regard to general business practice. I am no socialist and have no problem with people making a profit, but when it comes to drinking I am a punter, a customer, a drinker and an occasional pisshead.

My question was how does a 2p a pint tax increase become a 10-20p a pint price increase over the bar? The answer is simple. Brewers, pub owners and landlords take the opportunity to cash in with a general price rise. The business term is “maintaining ones margins”, or the percent gross profit per unit of product sold. Thus a cost increase becomes an exponentially increased price increase if a business chooses to operate with any given margin. It was said by the lad Mudgie on Dredgies blog that business needs to maintain its profit margin to remain viable.

Actually they need to maintain their overall profitability in absolute terms, not percentage terms on product cost. They need to maintain sales, customers and profit levels.

Not all pubs appear to work on a requirement to maintain a specific high margin. The Spoons appear to do startlingly well out of a low margin supply chain. Meanwhile the supermarkets are maintaining a low margin supply chain and offering customers excellent value for money.

I don’t get why that is wrong, irresponsible or evil. As a customer I want value for money. Cheap stuff stretches my pay packet all the farther and makes me a more prosperous individual. Unlike Dredgie I have no desire to work all week and piss all my money away in pubs. The lady squeeze is more than capable of pissing our hard earned money away on tat. I gather she considers shopping to be some sort of hobby instead of a necessary evil required in order not to starve. I like to divert a chunk into savings accounts and my nominee share account. I work to make myself rich, not others.

When you look at the least wealthy in society, and there are a fair few of them (more people earn less than the national average wage than above it), the pile it high sell it cheap business model affords the widest prosperity the largest group of people. People who can afford to celebrate with a bottle of Champagne because the likes of Tesco flog them cheap, but otherwise would not. Knocking the poor appears to be the current zeitgeist of society. How else do we explain the acceptability in referring to people of low income whose tastes may appear vulgar as chavs? You can possibly explain my own dislike of middle class values as having their origins in my own working class childhood. When it boils down to it, university, a professional occupation, a posh lass under the duvet does not alter the tribe to which you belong and I remain one of the chavs and if I’m honest I enjoy offending people with the vulgarity of my freedom of choice. I like that people don’t like it.

Many in the pub industry believe they have a divine right to my boozing quid and seek to kybosh those low margin retailers offering me bargains. All hail Tesco, Sainsbury & Morrison’s! We ought to have a national supermarkets week, at some point.

If pubs wish to cut their own throat by maintaining ridiculous unsustainable margins, that’s there look out. I’m not about to start caring, just look at these bargains!


The Beer Nut said...

Spot on, Mr Lager.

Tandleman said...

Find myself agreeing with you again Cookie. Pubs that price themselves out of the game are no friend of the drinker.

Cooking Lager said...

You 2 want to stop agreeing with me. It might become habit forming.

Check out

740,163 fans. All retarded.

Dick Puddlecote said...

Don't forget to look round the bargain shelves too as beer occasionally makes an appearance. This afternoon, I found a battered 15 pack of Fosters which contained only 14 cans and held together with brown sticky tape. Nothing wrong with the beer inside but they cost me a mere fiver. :-)

Woolpack Dave said...

It is of course everyone's choice as to where they drink. Wetherspoons provides an example of what can be done. In a free market we can expect that. Some pubs will provide a more upmarket response and some of them will even do quite well.

As far as price rises occurring in conjunction with beer duty rises is concerned it is the case that many businesses find it convenient to lump together all the costs of running the operation together at the time of tax increases. It makes it the fault of the government.

Personally I do not think beer duty is the main cost pressure on the price of beer in a pub. Things like insurance, mandated CCTV, increasing expectations of comfort by customers and many, many other factors effect the price of beer in a pub.

The Beer Nut said...

many businesses find it convenient to lump together all the costs of running the operation together at the time of tax increases. It makes it the fault of the government.

It is not the government's fault that they find it convenient, nor that they do it at all. Are you implying that price increases wouldn't happen if there were no tax increases?

Furthermore we're not just talking adding on the raised running costs: we're talking "maintaining margins", seemingly a euphemism for "If someone else is gouging the punters then by God I should be too. By more".