Saturday, August 2, 2008

The reality of pricing

A while back, the missus and I were having lunch and watching a football game at the Dogfish Head Alehouse in Falls Church, Va.
As we suffered though the Bucs/Lions game, the bartender mentioned that she had a couple bottles of the brewery's special (i.e., high alcohol and expensive) beer, 120 Minute India pale ale. Curious, we ordered a bottle and split it.
The cost? $18.
Sure, that's a lot of money to pay for a 12 ounce beer, but I considered it a rare treat that surely was only available at Dogfish Head's pub and restaurant.
Then I found it a week later at a local liquor store for $8 a bottle.
What the hell?!!
That, I quickly realized, is the rub of restaurant pricing. Even when the bar/pub/brewpub is owned by the brewery, its products will always be cheaper at a store. Every beer and burger you buy in a restaurant has to pay for more than the product and its components. Restaurants and bars have to make a profit on their products in order to stay in business.
Nevertheless, there is something counter intuitive about this concept when the restaurant sells products its parent company produces. Regardless, the rules are the rules, and Dogfish Head has to mark up the cost of the beers it brews and sells in its restaurants.
So when I came across Dogfish Head's limited release Immort Ale during a recent visit to the alehouse, I passed and ordered another Alehouse 75 draft (a blend of the 60 Minute and 90 Minute). At $15 a bottle, I knew I could find the Immort Ale cheaper elsewhere.
Sure enough: I found a four-pack the other day for $15.

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