Limiting Case Count: Supply and Demand

From a business standpoint, the math doesn't work out for a very limited production cult non-BA beer that does not have unicorn as an ingredient. I have a specific beer in mind as an example, but would only rile their fans to name it, and that's not my point. Allowing a non-BA beer to be so limited that it creates a frenzied release day, after which it is gone (except limited tap) - runs contrary to profit. Yes they can charge a lot, and the retailers tack on another big profit - but if they could double or triple production, still remain well under demand, and reach more customers, then they could make more profit even if the price dropped a bit, and there would be more fans. I am aware of the arguments of tank-time, seasonal beers, etc.

 

So in a marketplace such as exists today (with lots of potential new customers coming from the one-and-done crowd), you think a brewery could survive economically and show a profit for its investors by switching all of its production capacity to just one beer and do nothing else except produce one beer?

 

And yet you've ignored all of those arguments? Not to mention that most businesses are rational entities, & if they could really goose their profits & add new customers - don't you think they'd do it?

 

And of course, if they were solely about maximizing profit, they would scale up as quickly as possible and sell out to larger brewer as that is the way to make the largest profit the fastest...

 

So you aren't speaking about hoppy beers, I guess, since the ones that are "all the rage" now depend on getting an adequate supply of proprietary hops. Finding out your beer is a big seller doesn't mean you can just go out and get exponentially more hops to make it in huge quantities. These things have to be planned pretty far in advance. Add to this that hoppy beers have a limited shelf life, and once on the shelf out of local area the locavore consumer is no longer buying it, and it must compete with larger brands already recognized by consumers, so it is obvious that it is mandatory to find a way to sell it quickly.

So you must be talking about non BA stouts, or non BA sours in your example?

 

Sometimes more is made of a certain beer. Last year Bell's made 11000-12000 bbls of Hopslam. Compare that to the amount in this quote by John Mallett from the 2012 CBC. “I’m going to have a beer that we make 4,000 barrels of, one time a year. It flies off the shelf at damn near $20 a six-pack, and you know what it smells like? It smells like your cat ate your weed and then pissed in the Christmas tree.”

 

I never said they should switch all their capacity. Where did you read that?

 

I didn't ignore them, I dismissed them. I agree, makes no sense not to bump production of a non-BA cult beer.

 

Right - a non-BA stout. Seasonal, yes. Would probably take more brewing time than other beers, granted. Still, if you're brewing a dozen beers, and one has a cult following and sells out in a day, I expect one of the others could be impacted to double the run. They can do what they want obviously, I just don't get it. Granted there could be some other non-obvious variables.

 

True, you did not say that directly, However, that is one of the implications of what you did say.

For example, Russian River has a limited brewing capacity. For them to produce even one of their popular beers (e.g., PtE) in double or triple their current schedule would require that they produce that one beer and only that one beer year round and never brew anything else. There seems to be no other way for them to produce that much. For them to produce enough PtY would be even harder.

 

Perhaps a "non-obvious variable" is that many breweries have commercial (reataurant) obligations that they need to fulfill. Making more of a high-cost stout that is loved by beer nerds will reduce the amount of high-margin regular beer that pays the bills.