Night Shift Brewing

Ha, that's usually my logic as well but I reserve the right to complain about said price. I've complained about prices of releases before and then ended up buying it anyway. Many times its the Night Shift Barrel Society beers that I say I won't buy and then buy anyway because I can't resist it. There's what I want to pay and then there's what I am willing pay, often times they are not exactly close.

 

Pricing of a beer is going to take into account more than margin whether its a guest beer or not. First and foremost is supply and demand. The supply is pretty low for Heady around here (without traveling or getting a mule). The demand is still pretty high. They probably could have charged the $12 price and it would sell out but they went with $10. You certainly aren't going to put a beer that isn't very much in demand at a high price simply because you want to maintain your margin. It won't sell which also affects your overall margins. You've got other fixed costs that go down when you have higher volumes no matter what the individual margin is on a specific beer.

Beyond that it depends on what your reasons are for having a guest beer available. A beer like Heady is good publicity to get people into your beer garden when you've got several competing beer garden's out there. Likewise if you add wine or cider to your menu to expand your clientele then your margin is less important because you want to bring in more traffic that otherwise wouldn't come. Bottom line margin is not the end all be all in pricing.

Anywho, the $10 price for Heady is more inline with Night Shift's overall pricing. For whatever reason $12 just didn't seem like something NS would charge so it was surprising to me.

 

One thing to note on pricing is it's usually not the same margin for on every beer. Some are less and some are more - really depends on a number of factors. From yeast strains, pitch rates, packaging, style, tank time, volumes, contracted hops vs. spot market hops, labor, fermentation additions & consumers willingness to pay a craft price or a macro beer price for a style.

NSB has always strived to make our beer welcoming and affordable to all people while maintaining a profitable business. And we don't typically put profit at the top of our priority list. Prime example - our beer gardens. We would make more profit by only selling NSB beer but we chose not to do that and celebrate a bunch of other great brewers because that's more fun to us.

 

The psychology of pricing is indeed pretty interesting. It's extra interesting how readily one call still "fall" for it even when you intellectually understand the math and/or don't care too much about the price in the grand scheme of things. #alcahuetej-onepercent

I don't mean this as a dig at Night Shift or anybody else for that matter, but it's notable that Fort Hill continues to pump out perfectly decent (to my palate anyway) IPAs and DIPAs for $8 and $10 a sixer respectively (plus numerous other styles at similar prices). I wonder if, much like the wine industry, different breweries may simply be consciously positioning themselves at particular price points to appeal to different markets and to cast their brand in a particular light.

 

Yeah I don't like Fort Hill. They're like the Market Basket of New England craft beer.

No but seriously, I really don't care for their beer.

 

I actually remember that you don't. But I'm assuming there are plenty of beers at a higher price point that you don't like either.

Also, "The Market Basket of X" is just about the highest compliment I could offer something

(no seriously, I mean that)

 

I fucking HATE Market Basket.

It should be no surprise that I shop at the most expensive store in the Cambridge/Somerville area, the *Star Market in Porter Square.

*When Market Basket shut down a few summers ago (back when I used to shop there) I store hopped and compared prices. Star Market in Porter beat out Whole Foods.

The real reason I stopped shopping there was because they don't have many items I want. They're great for perishable goods, cereals...etc., but half my list I was buying elsewhere. So it was easier to go to Star Market, it was closer and had everything I needed. Plus Boar's Head...Thin n' Trim blows.

Finally...the closest MB to me is the one in Somerville. Which is also the 7th circle of hell. So that doesn't help.

 

There is a FREE parking lot right off of Soldiers Field Road, across from WBZ-TV.

 

Ha ha! I think we had a whole thread about this a year or so back?

At any rate, I will fully and completely admit that the Somerville Market Basket is the expired Bud Ice Dry of Market Baskets

 

I lived in Somerville for 9 years and shopped at the MB...then i moved and went to other MBs elsewhere and realized that's the Somerville store is an anomaly and most MB stores are newer, bigger and nicer. That parking lot is such a nightmare!

 

Certainly I'd check out others and see if they stocked what I need if they were closer. I've been to many others that aren't bad, Reading, Woburn...etc.

One of my co-workers years ago used to work at MB, and I don't know if this is true anymore, but he said it does the most business out of any Market Basket in MA next to Chelsea, but it's also the SMALLEST Market Basket in MA.

Recipe for disaster...

 

Just a quick note on that - Even though a brewery like Fort Hill is in MA they have a different cost structure, overhead, financing, and other expenses. They also have different scale of equipment. Our rent, our cost for labor, our debt, etc all get factored into costs.

 

Totally fair. It seems like your business is doing really well, so clearly the pricing structure you have settled on is working for you. And most importantly, your beer is great.

With that said, I do often choose to buy your competitors' products because it's so much more affordable. Santilli is a great beer. Better, in my opinion, than Sierra Nevada's Torpedo. But 72 oz. of Torpedo costs about 75% of what 64 oz of Santilli costs, and it's about 95% as good. So most of the time, I'm going with the Torpedo (if it's relatively fresh).

I understand that SN has a totally different business model, volume of production, and cost structure than NSB does. But at a certain point, I need to save those few dollars. This may be less a problem for NSB than for other New England breweries, because you guys are far from the worst on pricing. At $13/4pk for a reliably great beer, I'll buy the Santilli sometimes. The new breweries asking $16/4pk for ordinary beer, that's another story.

 

The psychology of all marketing is interesting and as you say we often fall for these things while intellectually understanding what's being done. How many times do we buy a limited release that likely is barely different than another release? Those releases hit two great motivators, feeling "special" because you are one of the few that have had that beer and the fear of missing out on something that might never be available again. Everyone falls for these things once in a while.

I've only had one Fort Hill beer and I thought it was pretty decent (love the Market Basket reference by @AlcahueteJ though perhaps they are the DeMoulas?). Anyhow differentiating on price is a slippery slope. Generally a bad idea if you don't either have the best product or a great name. Low prices generally indicate a more commodity product and then you are just competing against a larger field of players and you have a race to the bottom. Where this could get interesting is for someone like Tree House. They are closing in to the point where they are not going to be able to continue to sell their product direct to consumers and in a fast enough fashion to maintain shelf life. They could move to retail distribution but that diminishes their margin and its unclear that once the initial excitement wears off how will they sell? What would happen if they moved from their roughly $4 per can for Julius down to say $3? They are still reducing margin but they are not losing the brewery only cache. Would that allow them to maintain/increase volume? How would that affect the overall industry or at least the MA beer craft beer industry? If they choose to go to retail distribution it will affect the local market as well. Trillium has been focusing on increasing their direct to consumer sales rather than increase their production since presumably they are struggling with trying to figure out how to maintain the "somewhat hard to get" value without losing margin and without glutting the market. Night Shift has been smart in this same way of increasing direct sales to consumer rather than greatly increase production ability (contract brewing for instance). A bit off topic but I've got to imagine these are the sorts of things that are keeping these brewery owners up at night.

 

Sierra is attacking a different market, the old school craft beer drinker or the cost conscious craft beer drinker (presumably like you). When I think of craft I no longer think of the big guys like Sam Adams or Sierra. They make quality beer but its like comparing Subway to your local sandwich shop. The local sandwich shop is using better ingredients and taking more time with their product. I don't really want a mediocre $5 foot long, I'd rather have a $8-10 well made sandwich. You could offer up Torpedo up pretty much at any cost and I'd take any beer from a craft beer brewery like Night Shift over them. Their pricing structure is based on who they are competing with which is not really Sierra to be honest. It's the other smaller craft beer breweries. I don't think most people drinking NSB are thinking "hey this beer is 5-15% better than Sierra", they are thinking its 50% or greater better.

 

Totally get that and that's a trade off we all have to make. SN makes over 1 million barrels of beer and is 35 times bigger than we are! So only being 25% more expensive is exactly pretty good on our part.

We always strive to find the balance between running a profitable business and giving consumers good value. We never aim to price gouge. Great beer should be affordable and accessible to as many folks as possible both from a price point and an access point. That's been a key part to our philosophy from day 1.

 

Never shop at a grocery store that has carpeting. Or am I thinking of Johnny's?

 

So many things keep me awake at night... Perhaps that is why we started a coffee business to keep us awake during the day...

 

Sierra Nevada is extremely high quality. I highly doubt they skimp on ingredients, and their packaging protocol is top notch. Very little oxygen getting in their products during packaging. It's why their beers can taste great for months.

I would say Summerfest was better than any other Pilsner I've had in the last couple months outside of Notch.

Nah, no carpets at the Somerville Market Basket. Just saw dust.

 

Sierra Nevada uses high quality ingredients and makes incredibly consistent products. In comparison most other breweries cannot replicate even their flagships.