Silver Eagle Boycott

Martinus - I would argue no one here has a dog in the fight. But, Petrol Station took it to social media and everyone became involved. If they had dealt with it privately and just had a simple message saying they are no longer carrying SE kegs due to the price hike, then there wouldn't be negative feelings towards them.

The problem is they did not. They had to make this a "us vs them" thing while dragging in a whole bunch of half truths. Simple thing, don't take it to social media if you don't want people to talk about it.

 

Martinus, you can't argue with these people. They don't understand how SE is profiting from the deal. They don't see the relationship between SE and Budweiser.

It would be like a guy owning a house, renting it to his son for $1000, and his son sublets a room for $300. Then one day son walks in and says "hey, next month it'll be $500. Deal with it, or get out". Father isn't raising rent, but son decides its okay to hike the rent.

Accordingly to the SE backers in this thread the son isn't profiting, because he is still writing a check for the $1000 total rent.

I applaud Petrol for their stance and without social media this bullying wouldnt be public. Unfortunately SE has a monopoly on the craft breweries in Houston, and the 3 tier system only works in SE favor

 

I can get my rent back like a deposit? Didn't know that the bar was going to be paying more monthly either....so, basically, nothing like a rent.

This conversation has gone full circle again.

At this point, I still believe this is a whole big issue over a minimal price increase. We all disagree on that.

I think the whole system is screwed up and the system should be fixed. As in, have it based on the number of kegs lost, as opposed to an upfront deposit. But, that is almost impossible too as in if a bar closes, they'll likely never pay that back. Either way, we disagree on this. Oh well.

 

Okay, use rent deposit. The point is, again, SE is charging more than the breweries are charging them. Therefore, profit. Rather it be temporary or longterm its still increases SE capital plain and simple.

 

Except if the distributor or the bar damages the keg, they are still out $30 or more. You're analogy makes it sound like they are charging the full amount of the keg then charging a deposit. Either way it is a refundable deposit. Can I borrow your car for the weekend at 60% of its value and not be responsible for any damages or even of return it. I could sell it and let you keep the 60%

 

No, it's not like that at all. The scenario you describe is profit, the scenario the rest of us are talking about is a temporary deposit.

No, it is not profit. Once a keg moves from the brewery, to SE, to the bar, back to SE, and back to the brewery, the net result to SE is $0.

The net result to the bar is also $0, which is why so many people in this thread don't agree with the bars' outrage. The only people losing money in this whole keg deposit thing are the breweries.

 

Well said.

 

But for the bars boycotting the increase, they do not buy ABI kegs. Therefore if the SE craft keg is lost the net result is the retailer is out 60 bucks, the brewery loses a keg and only has less than half covered by the SE deposit and the distributor made $10. Like Scott said when the brewer charges SE for their half of the lost kegs at the end of the year, the extra 10 per keg doesn't cover, but it sure is nice not be out 100% on their end.

All the blame really needs to pointed back towards ABI for pricing beer below cost to drive volume. When a deposit + the ABI beer is less than the total value of the keg itself it's no wonder the kegs end up missing.

 

We have also boycott all the craft beers from Silver Eagle because of their different policies for small retailers and big stores. They always want to support big chains and never appreciated small retailer businesses.

 

How is this different than a bottle shop or pub holding back special releases for their biggest customers? Those who spend the most usually get the most. That is just how business works and just because a bar is craft doesn't mean they should get special treatment.

 

SED comes off anti-craft...they swang a big one in the TX Legs too and those anti-craft bills everyone hates..who supports em?

 

People argue for the sake of arguing on this site...if you look at it hard enough you see SED for what it is

 

Actually, Silver Eagle was one of the few distributors on the side of craft brewers during the monumental legislative session two years ago that opened up enormous opportunities for craft breweries (link). It's a big reason why Scott Metzger decided to sign with them (link). Their craft beer portfolio has exploded over the past few years, especially TX brands. They know that independent craft breweries are going to play a large role in the beer industry in coming years, and they've spent a lot of time and resources investing in those breweries. Yes, they're still a Bud house and yes, they're still going to scratch ABI's back from time to time. But to say that SE is bad for craft is blatantly false.

 

So let me get this straight. SE is out to help the breweries, or out to profit $10 on every keg? Like Scott said, the brewery and the distributer split the cost of the keg. If the brewery was s concerned with "lost" kegs then why don't they raise their costs? It all points back to SE/ABI trying to gain a $1 anyway they can.

Sounds like a classic case of smoke and mirrors. ABI does craft a favor, then 6 months later says "oh remember that favor we did? It'll cost ya $10 a keg to your clients"

 

I am not sure why you keep saying profit. It is a deposit, not a profit. They are two different things. When a keg makes the full circle from the brewery and then back to the brewery there is no profit made by anybody.

The brewery is concerned with lost kegs and they are raising their costs, hence this entire thread... Every time a keg is lost the brewery loses money. They are not trying to "gain a $1 anyway they can", they are trying to minimize their losses due to somebody else's theft and carelessness.

 

So what happens to that $10, which as stated is somewhere between $300-1000 in the meantime? Is it duct taped to the keg? Or is it in SE account to do with what they want?

 

It seems that everyone is throwing out numbers and arguing costs of kegs. Way off track. The issue is Budweiser. At least that is the excuse Silver Eagle gives for the deposit increases.
If craft breweries need to increase the price of keg deposits because of losses, that is a good discussion between them, the distributors, and the retailers. I don't think there would be this ruckus going on in social media about the small brewers needing a boost.
The issue is Budweiser dictating term and prices that everyone else must follow. The issue is Silver Eagle charging higher prices in the Houston market than other distributors throughout the state. The issue is the incestuous relationship between Budweiser and Silver Eagle that is the trigger for all this ruckus. The issue is the politics involved and the unfair lifetime rights to a brewery a distributor is awarded by the state legislature.
That is why the "craft beer" bars are raising hell about this. The craft breweries really have no say because if they don't shut up they will lose warehouse space at the distributor.
There are so many breweries that would love to enter the Texas market. It is cost prohibitive and the politics suck.
Louisiana is a small market yet has an incredible selection of hard to find beers. The reason is their is much less resistance to the entry into that market.

This is what needs to be fixed.

Fixing keg losses is just a problem with logistics. It is not a difficult problem to resolve.

 

Playing the system brothas! Smoke and Mirrors indeed

 

this thread makes my brain sad

 

Hay Merchant posted this on their Facebook page last night. I think it reflects a very balanced view of the "issue" from a Houston bar's perspective. They have now lifted their own boycott and the reason why is that they made their point, they weren't going to get SE to change and that further boycotting was just going to hurt a lot of local (and national) craft beer brands for no reason. A disappointing outcome but it's the outcome you could expect when dealing with a party in a governmentally protected position (it's hard to believe that breweries cannot change distributors--how does that even make sense?).

Hopefully new breweries into the Houston market (including both local and national participants) learn from this and choose to go with another distributor in Houston.