Is barrel aged beer overpriced?

You seem to be making the error of assuming cost-based pricing, which would be expected in well-functioning commodities markets but not in markets in which consumers don't consider the products fungible, as is plainly the case in beer and liquor. You also seem to be underestimating the barrel-aging costs to typical small American breweries compared to much larger aged spirits producers, not that those costs should be expected to have a significant impact on the prices charged beyond the fact that producers are unlikely to market their wares at a loss. If you insist on focusing on costs of production, a better comparison point would be the products of American micro-distillers, which typically charge $25 or more per bottle for 2 or 3-years-aged whiskeys, and even they likely are better equipped to handle barrels (buying in bulk, constructed for storage space, etc.) than are most craft breweries.

 

How would we know that they’re over priced? I don’t have a clue what they pay for the bourbon barrels, there’s lots of competition so I’m sure the price moves up, then there’s maybe up to a year dwell time, and it takes up space. High risk on infection from the barrels I suppose is a factor too. Sure KBBS at $100 is a joke but a 4 pk of KBS for $22? Not a clue.

 

Short answer? Yes they certainly tend to be.

 

Yes, no, sometimes and maybe.

 

Thread title:
Is barrel aged beer overpriced?

Does it sell? Then the answer is no.

Does it not sell? Then the answer is probably yes.

Simple. Cost to produce doesn't matter.

Costs matter to profit, not to whether or not a product is overpriced.

 

Over priced could be a state of mind too, if I’m Mike Trout what the hell do I care what the price of anything is? I have a 40 mil a year job guaranteed for 10 years. If I’m a college kid that KBS even if it’s $20 doesn’t really work either, I’m drinking PBR most likely. So your analogy seems about right, if it sells out it’s marketprice, if it’s a shelf turd and it’s 2 years old it’s probably high for the market. KBS might be $22 some places, could be north of $30 in others.

 

Oh...D..arn. There you again bringing business reality into the picture...

 

Over priced can definitely be state of mind as well... good examples BTW

 

Yeah, that's why I said "probably" and not "yes" to "doesn't sell".

If I took KBBS to an NFL tail gate and tried to sell it for $200 a bottle, it most likely would not sell... wrong market. (Barring a beer nerd who knows what he sees...)

 

Another production cost that has become part of the routine for better equipped breweries is to do microbiological testing on each barrel, for a variety of spoilage organisms. Some of these tests are to catch critters with long incubation time. Those won't show up in sensory testing until the beer is packaged and on the shelves.

A well equipped lab, supplies, and the personal to run it all add up.

 

But cheaper than GI buying back million of dollars of beers. If it was me a pasteurize it and be done with it. So it’s not bottle conditioned, so what?

 

And GI has long had such a testing lab or even also sent stuff out to bigger pro labs, but sometimes even then, "s*** happens."

 

That's your basic Business Admin 101 course.

 

All of the QA costs show up. QA/QC programs are to catch quality "spills".

Yes, buy backs and other campaigns are more expensive, and the hit to the reputation can't be easily repaired.

 

But, sells out in hours and has 10x pricing on the black market. So, no.

 

It seems like 11 months of time repaired the reputation for the Goose. Most of us have short memories.

 

You should read the Bourbons County 2019 thread. Still some anger out there.