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Yes, The Economy Is Slow -- It's Cutting Into Beer Money
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Cost-conscious consumers are opting for cheaper beer.
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Published: May 16, 2008
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TAMPA -- With gasoline and groceries gobbling more and more of their income, beer drinkers are seeking carbonated comfort in cheaper brews and slaking their thirst for suds at home rather than in bars and restaurants, distributors say.
Across the nation, beer brewers say the reeling economy is being reflected in the sales of beer, traditionally considered recession proof. The bottom line is that beer sippers and swillers have less to spend on expensive lagers and are opting for the cheaper brands.
Make no mistake, beer is still big business. Pepin Distributing of Tampa is making tons of money. They distribute high-end beers that sell for $25 or so a case to "value brands" that sell for $14 a case or less. All told, Pepin distributed 10 million cases of beer last year.
Marketing director Bill Gieseking said sales of beer in places like grocery, convenience and liquor stores is still strong and the rise in sales of cheap brews is somewhat mirroring the national trend.
"In April, Busch and Natural Light were up 13 percent over April of last year," he said. And between January and now, those cheaper beers are selling 5.4 percent more than over the same time last year. Busch and Natural Light are considered "value brands," as is Busch, which is up 7.4 percent over last year, having already sold nearly 200,000 cases, he said.
Sales of Corona, which is the most expensive beer distributed by Pepin, is down by 5 percent, he said.
Sales of kegs, which mostly go to restaurants and bars, is also down by slightly more than 1 percent, he said, indicating fewer people are drinking beer out. The rise in beer sales from retailers means people are choosing to drink beer at home, he said.
"People don't have that expendable income to go out to dinner and have couple of beers," he said.
The downturn in sales is enough to catch the attention of the industry, he said.
"Sales are soft," he said. And this is really the first time in this economy. Beer is not usually impacted, but this time we are."
Pepin is looking at ways to cut expenses. The distributor, which supplies 68 percent of the market in Hillsborough and parts of Pasco counties, isn't about to raise prices, even though the price of diesel fuel is ever rising. Layoffs aren't planned either, he said.
"We're just going to ride this storm out," he said. "We think this trend will turn around by the end of the year."
Beer drinkers in the Tampa Bay area make the business strong here, he said.
"The Tampa Bay market has always been a great market," he said. "We are driving the state."
Miller Brewing Co. officials this week in Milwaukee said that they are seeing a shift from higher priced premium beers to what they termed economy beers. The trend began in January, they said.
Beer companies say they are selling just as much beer, but are noticing the shift to the cheaper brands.
Beer distributors all over have reported a decline in beers delivered to bars and restaurants, while sales to retail outlets like package stores and supermarkets are on the upswing.
Joe Ciaccio, owner of Dewey's Liquors in Temple Terrace says he hasn't notice much of a shift in sales of one brand to another. That's because his prices are on par with or cheaper than those of some of the larger retail markets.
He has been in the retail liquor sales business for three decades, he said, and is second generation liquor store owner.
"I can't say we're seeing people go from Corona to Natural Light now," he said.
George Trinchet walked out of Dewey's with an 18-pack of cold Bud Light to help celebrate his wife's birthday.
"I haven't changed beers," because of the economy, he said. "I may drink a little less or not go out as much."
Information from the Associated Press was used in this report. Reporter Keith Morelli can be reached at (813) 259-7760 or kmorelli@tampatrib.com.
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Reader Comments
Posted by ( whasup ) on May 16, 2008 at 3:35 p.m. ( Suggest removal )
I took out a mortgage on a six-pack yesterday. I don't...hic...see the problem.
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Posted by ( ceibert ) on May 16, 2008 at 3:48 p.m. ( Suggest removal )
Old Milwaukee? Is'nt that Mississippi River water? Gross!
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Posted by ( BrassBowldotOrg ) on May 16, 2008 at 4:20 p.m. ( Suggest removal )
Life is too short to drink cheap beer.
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Posted by ( BlueJar ) on May 16, 2008 at 4:51 p.m. ( Suggest removal )
I'm drinking beer at home more but I'm still drinking it. I won't start cheaping out. Cheap beers taste like rain water.
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Posted by ( acuratl96 ) on May 16, 2008 at 4:57 p.m. ( Suggest removal )
whasup, LOL
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Posted by ( chizillinflstyle ) on May 16, 2008 at 5:07 p.m. ( Suggest removal )
I think they might have put the Old Milwaukee in the story for the Rural dwellers.
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Posted by ( Quagmire ) on May 16, 2008 at 5:10 p.m. ( Suggest removal )
I have started drinking gasoline and putting beer in my gas tank. It's cheaper.
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Posted by ( DarthRandall ) on May 16, 2008 at 5:16 p.m. ( Suggest removal )
"Yes, The Economy Is Slow -- It's Cutting Into Beer Money" Yeah, wanna bet? It'll cut into a lot of things (food, clothing, mortgage, my kid's college fund) before it'll cut into my beer money..........
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Posted by ( jandpbell ) on May 16, 2008 at 5:16 p.m. ( Suggest removal )
maybe instead of that guy buying beer to celebrate his wifes bday he could have taken her to olive garden for the all u can eat soup salad n breadsticks lunch... jeeeeeze what a weiner no wait winner... nah i was right the first time
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Posted by ( lovetherays ) on May 16, 2008 at 5:20 p.m. ( Suggest removal )
I am not worried about the beer-I drink a bottle of wine a night
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Posted by ( ceibert ) on May 16, 2008 at 5:25 p.m. ( Suggest removal )
Yah, well when you have to start drinking MD 20-20 your attitude will change!
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Posted by ( Michael ) on May 16, 2008 at 6:09 p.m. ( Suggest removal )
Old Milwaukee? Aka Old Mildew..would never drink that stuff. I stick with my Becks Light beer. It's a $1.50 more per 12 than Budweiser and almost even with Corona.
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Posted by ( bayline30 ) on May 16, 2008 at 6:53 p.m. ( Suggest removal )
drink whiskey.its cheaper
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Posted by ( sccpap ) on May 16, 2008 at 7:41 p.m. ( Suggest removal )
Natural Light works for me, when I want a better beer I buy "Dutch Windmill ", it is similar to Becks and only 9.99 for 12 pack, I buy this at the Winn Dixie in Sun City Center.
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Posted by ( OHu812 ) on May 16, 2008 at 7:41 p.m. ( Suggest removal )
Play "Quarters" charge $5 to play, get more buzz for your buck! And it's better than drinking alone.
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Posted by ( Right_On ) on May 16, 2008 at 8:20 p.m. ( Suggest removal )
The simple solution is legalize marajuana and tax it...all that revenue could offset gas prices down to about 50 cents a gallon plus probably pay off the national debt in a year LOL. And I know the Oil Cartel would gladly trade weed for oil 'cause they are prohibited from drinking!!!
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Posted by ( Old_FL_Crab ) on May 16, 2008 at 10:02 p.m. ( Suggest removal )
Hey, TBO already publishes the cheapest gas prices. The chart at top of this article is handy. They should keep it current and expand to include more brands, but good start. I'll drink to that*
.
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* don't count for much, Crab'll drink to almost anything legal.
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Posted by ( OP ) on May 16, 2008 at 11 p.m. ( Suggest removal )
Gasamilkhol-it's all going up, cutting into the budget. Is no beer fund safe anymore.
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Posted by ( bonkbonk ) on May 16, 2008 at 11:29 p.m. ( Suggest removal )
old-fl-crab
I ALWAYS ENJOY YOUR COMMENTS.
As far as Pepin Distributors I worked as an electrician there. It was massive and a lot of fun. The electrical contractor was A. RANDY'S ELECTRIC. MY boss was a man named Stu. A walking genius if I've ever met one!
Randy died toward the end of the project. I never met the man but I know he was a tough cookie. He sure has a talented staff! I hope they were able to change the way things are done there.
If they see this I would like to say hi to Stu, Robert, Clay, Robert's bother and Ed. It was fun!
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Posted by ( RobKay ) on May 16, 2008 at 11:33 p.m. ( Suggest removal )
Save even more, drink the beer 1st, then p in the tank. There is a much more serious problem that hasn't been discussed here. As the price of beer goes through the roof, what are the ugly women going to do? They may well be lighting candles at the trailer parks already. OK now you can all holler at me for the bigoted remark but it had to be said.
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Posted by ( whasup ) on May 17, 2008 at 12:29 a.m. ( Suggest removal )
OMG...my trailer is on FIRE.
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Posted by ( johnboy ) on May 17, 2008 at 6:34 p.m. ( Suggest removal )
Right-on,has got it right, make pot legal and tax it and sale it just like alcohol,that way pot heads will pay taxs too.. their are as many pot smoker as their are drinkers, this = a lot more money for the state and the feds, pot heads got off for free for to long...
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