Pay to play?

This is an awkward one for me. Let's say I heard a story - that incentives are being sought by some pubs supplied through SIBA's DDS scheme.  Now, it's acceptable for a brewer to supply a pub with marketing materials, glassware even, to support the brewer's products which the pub has sourced through DDS.  But worryingly, I've heard (and I really can't say more than that) that some pubs are soliciting "off the books" contributions from the brewers as a condition for making orders through DDS.  These incentives may be anything from a contribution to items normally considered part of the pub's costs (over and above marketing support), to an extra cask or two delivered gratis. 


If this is truly happening - I'm appalled. Of course, I appal easily. I should really save my outrage  for more serious matters, but there you go.

If any SIBA brewers have come across this kind of thing, I'd hope that they would think very hard about reporting it officially. This kind of shit is exactly what we don't want.  DDS would become another way where larger¹ businesses (who might be able to afford this kind of promotion) can deny market access to smaller² ones (who, I guess, can't).  Anyone involved in this kind of deal should consider if there isn't a whiff of the old Bribery and Corruption about it. (note: IANAL)

You might wonder why I'm going on about this here, rather than raising the matter privately, inside SIBA.  At this point, I'm mainly interested in other people's experience. Ever heard of this? Come across it yourself? Think it's bollocks?

If anyone wants to comment in confidence, my office door is always open. (Well, it would be if the circ pump in the big chiller wasn't making such a racket)


1. or unscrupulous
2. or large, scrupulous ones

This "new" thing they call "craft".

It just occurred to me, how much of the problem some people seem to have with the c-word may be down, not to over-use (and there has been of late), but rather to lack of familiarity.  I spotted a knowledgeable beer blogger apparently expressing surprise at the term "craft butcher". This is a long established usage; I mean there's even a magazine called that.

Did we forget craft potters, craft furniture makers, etc? Looks like we've got some kind of recency illusion going on here.

Update: Someone asks: "why is there a need to dub an honourble old trade which makes a quality product with a contemporary term?" To which the answer has to be: It's not a contemporary (new) term. It's just new to you.

Another Update:
Time was, any self-opinionated so-and-so might hog a spot at the bar and, unchallenged, discourse on their favourite idée fixe or bugbear. "My opinion's worth (at least) as much as anyone's".   This style doesn't translate well to the context we find ourselves in here, for instance.

While you are (or I am) holding forth, our readers have got another tab open, googling any dodgy sounding fact, hauling up counter evidence from ancient copies of Hansard (or whatever). Get with it, Dad. 

Mash efficiency, etc, according to the Professor.

We recently came across a piece by blogging home/craft brewer (and, we're sure, diamond geezer) broadfordbrewer  Reading an account of a yummy sounding raspberry wheat brew, we were a bit confused by some of the calculations employed in estimating efficiencies. So, as we usually do when confused (and we usually are), we asked the Professor for help.

"Ah yes, Stringers," he smiled,  "I've seen the kind of thing you're referring to."  He laughed, "These homebrewers and their formulae, passed down like myths and fairy tales from who knows what original source!"

"Of course" , he continued, "you'd be wise to measure efficiency in terms of how efficient you are in getting stuff out of the grain, so you refer to laboratory extract, rather than simply the mass of the grain (which would include husk, other insolubles, dead mice, etc), as some homebrewers do. Why do they do that?"

He limped over to the blackboard, "See, Stringers, you may have come across something like this..."
Chalk squeaked.

Extract = (volume) x (specific gravity) x (ºPlato — expressed in decimal form).

"But this doesn't really make sense...  since we can convert specific gravity to ºPlato like this..."

 degrees = (SG x 1000) - 1000
ºPlato = degrees / 4 [approx]

"So why are both SG and ºPlato in this formula? Since we can convert one to the other, we're not adding any information by including both. Formally, they're measures of the same dimension, expressed in different units. Pretty much."

He continued, "We can substitute and rearrange, to show that..." 

SG x ºPlato = (250 x SG²) - (250 x SG)   He smiled, "approximately".

"You see ºPlato has disappeared. So, indeed, there wasn't any point in having it in the first place!"

We spoke up, "The maths always seems easier if we work with litre.degrees."

"For sure, yes", said the Prof,   "The product of volume and gravity in brewers degrees."
He flourished his chalk, "For instance..."
10 litres at SG 1.040 = 10 x 40 = 400 Litre.degrees.

"Yes", we said, "That kind of thing."

He commenced pacing, "The maltsters give laboratory extracts for the malts which you might  think of as the extract 1 kg would give in 1 litre. If that were actually possible. For decent pale malts this is probably around 300 (assuming a coarse crush / moisture as is)"

We nodded, he went on,  "That's to say, one kg of malt mashed under ideal conditions would give you 1 litre of wort with a gravity of something like 1.300."

"So, for an example homebrew mash:" He turned back to the blackboard.

Pale malt: 2.8 kg @ 293 L.deg per kilo = 820.4
wheat malt: 0.8 @ 296 = 236.8

He waved at the board, "I got these values for extract from a recent malt analysis, but you can look up typical values on the InterWeb , or you could call it 300 and wouldn't be far wrong."

He continued writing,
total potential extract 820.4 + 236.8 = 1057.2 litre.degrees

Turning to us, "What you actually get out of the mash might be 24 litres at 1.040 Specific Gravity, i.e..."
24 litres x 40 degrees = 960 litre.degrees

"So your mash efficiency is something like..."
 960/1057.2 = 0.908 = 90.8%

"Post-boil, you might end up with..."
 18L @ 1.044 i.e 18 x 44 = 792 and 792/1057.2 = 0.749
"That is..."
74.9%

"Which you might call brewhouse efficiency!"

He dropped his chalk and pushed his spectacles back up, "Got that Stringers?"

"Thanks Prof!"
 

Blog: Poll: Polls on Blogs. You decide.

Are there too many polls on blogs nowadays?

The Tie and the Small Brewers

Just suppose all this government PubCo malarkey ever reaches some kind of conclusion, and just suppose that a mandatory FOT (free of tie) option ushers in a new world of pubs. What's this new world going to mean for yer small brewer in this country?

I'm happy to consider myself a small brewer. Of course, if I had my right legs I'd be well over six foot. But hey, short legs run in my family (along with noses).

As things stand, whatever else they are, pubcos are big beer buyers (also wine, spirits, soft drinks, and everything else).  This means that they can demand big discounts from brewers (and everyone else).  The big brewers have fantasy price lists, of course, and are adapted to this.  The big brewers can also deliver the volumes that these big buyers require.  The pubcos operate closely with, or part own, wholesaler / distributors that facilitate this part of the operation. Then they whack a markup onto that discounted price to cover (a) their costs of running this operation and (b) the wet-rent element of their take from the pub.

We're all aware of the SIBA DDS scheme where small brewers can, if they wish, try to get their beers listed by the pubcos, so that select outlets can order their beer through their normal pubco channels and get it delivered direct by the brewer.  Of course, the costs of (a) administering this system and (b) the wet-rent are added onto the price that the brewer gets. So this beer is typically no cheaper (for the pub) than the regular stuff.  Dealing with the big wholesalers isn't really an option for the small brewer. We can't make beer for the price, or in the volumes, that they require.

If many pubs decide to opt out of their tied partnerships, they'll likely be charged higher rents to offset the pubcos lost wet-rent.  But they'll be free to buy on the open market.

And this is the question we started with.  What would this expanded free market for beer look like? What's the place of the small brewer in it?

There will be some new opportunities local to the small brewer - local pubs that have opted out.  There may be less call for beer through the DDS.  There will be opportunities for wholesalers to expand their free-trade business. The big wholesalers still won't be interested in small brewers.  There may be growth among smaller wholesalers.   There is the possibility that some small brewers will take advantage of the opportunities (particularly in the transitional phase) to grow their businesses quite substantially. Perhaps no longer being quite so very small.  I suspect the overall effect for many small brewers will be a small positive one.  Nothing to get really excited about.

Interesting times. Maybe.  Maybe not.

All the above, strictly a personal thing.

I'm not an Economist, but...

Professor Morten Hviid is. He wrote (in his reponse to the BIS consultation on proposed intervention between tenants and pub companies:

"If the market really is competitive as claimed, then increasing the fixed costs of the industry will lead to exit until the price has increased to cover these additional costs.  "

But that's not right is it? That would only be the case (at the retailing end) if variable costs remained the same.  But the whole point is to give the option of buying beer out of tie (at lower cost), increasing the gross profit available to those tenants who chose that option. And doesn't this then increase the incentive for the tenant to sell beer (they would get to keep more of the profit), while offering pubcos some insulation from the actual wet beer market (they'd have a portfolio of market rents to wave at their shareholders / lenders)?

Wouldn't a FOT option allow tenants to obtain a higher share of the profit while accepting a higher risk? Or, alternatively, allow them to choose the tie for  lower risk & lower profit. And contrariwise for the pubco? There being only so much risk (and profit) to go around.

Don't like it? Simply take it back.

So, imagine:  You're in, I dunno, a nice burger spot, you see other diners order at the counter.  Up you trot, queue briefly and examine the choices.

"What's the 'Chilli Superior Burger' like?", you ask the counter operative.
Comes back the reply, "It's a Habanero infused patty with fresh Jalapeño topping and it's really rather spicy."  
"OK", you say, "I'll have one of those, cheers."

Off to your little table with your purchase.  It certainly does smell spicy, but you quite like some spicy food.
You take a bite, but - oh my, this is terribly spicy (although you notice the chap who was ahead of you in the queue eating his with every sign of enjoyment).  You leap to your feet and march back to the counter, indignant:

"I bought this burger and I don't like it. Can a have a regular cheeseburger, please?"
The operative looks at you strangely, "But you've had a bite out of it!"
"Yes, please throw it away and give me something different, please. I'm somehow entitled."

The operative says:
[choose one]
(a) "Certainly."
(b) "You're having a laugh, aren't you?"
(c) "Security!"