Silver Eagle Boycott

It affects the bars buying it just as much as it does the craft bars. Probably more so due to the sheer volume of ABI kegs that some bars go through on a weekly basis. I guarantee that places like Little Woodrows and Buffalo Wild Wings are sitting on a hell of a lot more devalued Silver Eagle cooperage than I am.

 

So with 6 kegs per line that's an extra $60 per line. Say your bar is moderate size, with 20 taps....so that's an extra $1200 tied up in keg deposits....increasing to $2400 in September.

That is a lot of money, but for a bar/restaurant I wouldn't think that it is going to hurt them.

 

I wish I could like this twice. I was just saying this last night. HM was outraged when they lost one firkin, they rallied the troops and wreaked havoc in response to cooperage loss...

But now they're on the other side of things and suddenly cooperage loss is just something the distributors should deal with, with no cost to the actual end-user.

I've also been led to believe that SED is not pocketing the difference - their deposits from ABI rose and as a result, they have to pass on that cost - why would they just take a voluntary $10/keg loss, as some bar owners seem to want?

And I'd be willing to bet the reason we haven't heard from very many craft breweries on this publicly is because they're happy with it. ABI, because of volume, can lower their subsidy and now the craft breweries can too - but if they craft breweries had led suit on this issue, SED would have said "psh yeah right, we'll pay you the same we pay Budweiser and not a dollar more."

 

You are also assuming that they have 20 taps that are exclusively SE...which is doubtful. Maybe at a 60 tap bar, you can see that. Along with them having 6 kegs of each one - which is doubtful for 20 taps.

 

So, this kinda implies then that ABI did something (inadvertently) that will benefit small craft brewers?!

 

Good point

 

Why not just keep the deposits the same, but require a quarterly inventory and hold the bars with missing kegs accountable?

 

Scott,

Your post brings to light a very real problem for breweries and the 3 tier system but not a lot has to do with why the Flying Saucer decided to not pick up shells from Silver Eagle for the time being. This is a developing issue for us and it has only been a week. I wish I could support your brewery with cans or bottles like I am with some of our other favorite Silver Eagle breweries. If we can make that happen please hit me up. I bought a ton of your Hopthesis and I wanted to bathe in it I liked it so much, but my issue is with an unannounced price increase for what I perceive to be a service. Usually Silver Eagle does provide good service for us but as an operator of a bar I will always question and make push back when we don't get the service we believe we deserve. I am sure as an operator yourself you can understand that. We will get this figured out and we will move on.

I do have a couple questions for you though...

1. Were you or any other brewery notified of this price increase?

2. If they are charging more for a deposit than you charge them for a deposit could they, in theory, pocket the difference?
Your perspective on those two questions might help us resolve this.

Thanks and hopefully talk to you soon.

Asa

PS I prefer #KEGGERGATE

 

1) Bars will lie and 2) that's a lot of labor for SE if they are able to enforce it.

 

For the sake of clarity, I should note that my deposit from SE here in San Antonio went up from $40 to $50, not $50 to $60. Houston may have been different.

Not necessarily. I'm only losing $10 on the first keg. My usual in/out balance will take care of the rest as they rotate in. I estimate I had about a dozen or so SE kegs on hand (some full, some tapped, some empty) when the new deposit took effect. I'll still get my $40 back for those kegs while being charged $50 for new incoming ones. That's ~$120 in loss. SE picked up a few empties last week, and a few more yesterday. I still have a few on tap that will likely be picked up next week. So I'm averaging $40/week in new deposit costs during this transition. Would I prefer not to spend $120 on new deposits? Sure, but I think I'll live. And I won't miss that $120 six months from now any more than I miss the $200 deposit I spent on my apartment two years ago.

 

As long as they don't blow up, which they have a tendency to do if not treated correctly

 

I think you are referring to these:



But Bluebonnet and Bindlestick use these:



Don't know if they make a difference.

 

The big problem is the faulty 3 tier system and the politics involved. Money buys political favors more than votes.
It is about Inbev misconduct through its surrogate Silver Eagle. I certainly hope that these price increases will reduce the number of Silver Eagle taps overall.
If the collective brewers and distributors choose to set up a keg shell liability insurance program for the retailers, that would be a equitable solution also. The brewers and distributors should be responsible for wear and tear while the retailers should be responsible for return or replacement. The deposit would be the deductible overall and the more careless retailers would pay a higher premium for insurance.

 

Ah yea I was thinking of the rubber kegs. Never seen those plastic kegs but I can't wait for skunked kegged IPAs

 

Introducing new Grapefruit Sculpin, now with 100% more bisphenol A adjuncts!!

 

Well there is the high scrap value of stainless steal. I think each 15 gallon keg is worth more in stainless then the deposit

 

It's an easy money to grab one and leave....if a bar leaves them out

 

Has the BA think tank rendered its verdict?

I believe the federal district courts are now deferring to this site for brewery disputes (see New Belgium v. Oasis).

 

So, stupid question here, but why don't the breweries just charge the distributors the full value for the deposit?

It seems like the breweries are giving everyone else a break by charging a much smaller deposit and taking on risk. Then ABI decided that this deal was slightly too good and adjusted the terms, but is still giving everybody a pretty awesome deal and taking on a large amount of risk based on their scale of operations.
Then the distributors are just passing on the deposit adjustment down the line. Is there a discrepancy now between what the little guys are charging the distributor vs. ABI? Or are all breweries going to bump the deposit in line with ABI?

 

Well, I definitely do not think you age beers in them. I doubt there will be much issue just because it is very local deliveries and they probably get tapped the same week they are delivered. Hell, Bindlestick only has 5 accounts so far.