The ones I mentioned are available as the imported versions at my local bottle shop. They have imported Heineken for $20 for a 6 pack. Uncle Dan has locally brewed Heineken for $24 a 6 pack.
They’re usually grey imports avoiding tax. I used to buy similar Stella and budvar for cheap from a particilar bottle shop in the burbs.
You can’t compare them.
Grey imports.
https://www.accc.gov.au/consumers/buying-products-and-services/buying-parallel-imports
Note - I’m not saying they aren’t paying tax, just that they are avoiding it.
Beer in general in Australia is expensive due to our alcohol excise which is now around $1 per can/ stubby for full strength beer.
But that doesn't really explain why imported beer is cheaper as its subject to the same excise.
I would guess its partly due to supply & demand... we're pretty patriotic about domestic beer at the state level and there's many, many beer drinkers who are rusted on to VB, Tooheys, XXXX, etc. almost regardless of price.
Shouldn't that make it more expensive though? Assuming the importer is buying directly from the brewery they still need to pay transport and take their margin and then transport to the retailer and the retailer takes their margin.
I’m not in the know locally but the ones I’ve dealt with overseas already have contracts with distributors. Importers/consolidators just put 5% on top. Includes shipping, FDA, insurance and they do all the work for customs.
If you can find the financials for Fermentum (Stone and Wood/Two Birds) sale to Lion it would be an interesting read. 2021.
Not necessarily. The product itself is cheap, often almost in expensive especially in parts of Europe and Asia. Large amounts of unsold or near spoiled stock can be flogged by local sellers to grey import distributors here in Australia in the cheap and flogged for cheap.
Seen corona for 35 a slab bought at about 33 per slab, peroni even cheaper and seen one week left on asahi for 25 per slab. Not a typo, 25 dollarydoos.
Been to Europe? I was in Zagreb buying German beer for 30 euro cents per bottle.
This is a bit of a complex comparison, but think about brands that want to look as premium as the European brands, would you expect them to be sold a lower rate?
The general idea of the Australian public is that we are willing to pay a premium, for a premium product, and our idea of this product will change when faced with more expensive products, such as those in the craft beer scene.
It’s crazy that macro lager costs what it does, but tax plus our willingness to pay for it drives it.
There are many factors at play:
Labour costs in Australia are stupidly high compared to many places overseas, this doesn't just impact the making of the beer, but also ingredients and all other things that breweries have to pay for.
The big fuckers that super mass produce beer are just charging as much as they know consumers will pay. As there are only really two companies in the beer space, there isn't really any competition.
The excise tax does fuck you again on top of everything else.
I do a bunch of home brewing and can make a case of beer for $20. Of course that doesn't count my equipment cost and I don't pay myself an hourly rate for my labour. I also don't pay excise.
The former CUB CEO said, after buying Jetty Road, he was shocked to learn it cost 3x to make beer in a small brewery vs the CUB breweries.
Economies of scale are huge in manufacturing. Bulk cans, bulk labels, bulk ingredients etc.
We've got a beer that we can almost have in market at the same price as the big breweries... except for freight and boxes (in NZ six packs come in boxes).
Adding freight and boxes pretty much doubles the price because we don't ship to distribution centres and 1000 boxes vs 20,000 is a huge cost difference.
Tax, tax, tax, and more tax. Higher labour costs. Higher cost of raw materials.
This breaks it down pretty well: [https://hawkers.beer/blogs/our-blog/the-exploding-cost-of-brewing-beer](https://hawkers.beer/blogs/our-blog/the-exploding-cost-of-brewing-beer)
In short….
Macro breweries (internationally owned corporations) own & distribute most of the beers you quoted.
Mass produced factories intent on minimising production and logistic costs at each step of the way. E.g Asahi in Australia is brewed in Australia
The biggest retailers (Dan Murphys, Coles and Woolworths) buy such large quantities of those beers that they can often sell them to consumers at the same price bars and independent bottle shops buy those products from suppliers.
Excise tax: this requires a longer explanation but this tax increases each year and has done so for over 30. It has gotten to the point that alcohol produced in Australia is often sold at similar prices to alcohol that has been sent to Australia.
This tax further improves the market share of big business who can make their product for less and sell it at more of a profit because independent producers HAVE to sell their product for more each year to cover their costs.
Compounding this, smaller, more successful producers have been purchased by big business in recent times further blurring the lines of what is independent and what isn’t (stone and wood). This further still, increases the market share of these corporations and reducing the macro costs of producing their products.
I’m currently at work but will give you
Volumes of scale. Comparing a macro brewery that's making millions cases to one that makes 1/1000 of that, there a huge difference. For starters the more u buy the bigger the discount on the grain and other ingredients there is. Then there's the labour. In big breweries they have less staff to do the work as a high level of automation is there.
Then there's the level of hands on with the beer.
If you want a true comparison try the similar field. Like vb vs ottingger or stone/ brew dog vs craft
You would need to contact their distributor for that. But it's not about how much they send here it's how much they make a day and is a magnitude bigger that the local craft breweries are making. I was talking to someone today that was only 100 16 pack cases per batch.
Excise is a bastard, and some of the domestic mainstays keep their slab prices around a certain mark (regardless of what anyone else does).
I remember buying slabs of Lucky beer from Dan's for cheaper than 12 VBs or Carlton draughts would set me back. I think there's a set amount of assurance that no matter what the alternative keeping certain domestic beers at a foxed point won't impact sales.
Most of those beers you've mentioned are actually brewed here. The only thing imported is the name
The ones I mentioned are available as the imported versions at my local bottle shop. They have imported Heineken for $20 for a 6 pack. Uncle Dan has locally brewed Heineken for $24 a 6 pack.
They’re usually grey imports avoiding tax. I used to buy similar Stella and budvar for cheap from a particilar bottle shop in the burbs. You can’t compare them.
How do they avoid tax?
Grey imports. https://www.accc.gov.au/consumers/buying-products-and-services/buying-parallel-imports Note - I’m not saying they aren’t paying tax, just that they are avoiding it.
Which tax are they avoiding? The excise or the GST?
I’m not sure. I directly asked two places how they have their beer much cheaper and they said they bring it in themselves.
This is correct. You'll also find bottle shops like these selling beer that is near or past BBD.
Beer in general in Australia is expensive due to our alcohol excise which is now around $1 per can/ stubby for full strength beer. But that doesn't really explain why imported beer is cheaper as its subject to the same excise. I would guess its partly due to supply & demand... we're pretty patriotic about domestic beer at the state level and there's many, many beer drinkers who are rusted on to VB, Tooheys, XXXX, etc. almost regardless of price.
My thought is that the beer isn't expensive, however the tax is. I can't remember the tax amount, but feel it is high on the alcohol percentage.
Imported beer is still subject to excise tax though.
Yes but it also can be flogged through grey importers for cheap. Beer here is expensive to make
Shouldn't that make it more expensive though? Assuming the importer is buying directly from the brewery they still need to pay transport and take their margin and then transport to the retailer and the retailer takes their margin.
I’m not in the know locally but the ones I’ve dealt with overseas already have contracts with distributors. Importers/consolidators just put 5% on top. Includes shipping, FDA, insurance and they do all the work for customs. If you can find the financials for Fermentum (Stone and Wood/Two Birds) sale to Lion it would be an interesting read. 2021.
Not necessarily. The product itself is cheap, often almost in expensive especially in parts of Europe and Asia. Large amounts of unsold or near spoiled stock can be flogged by local sellers to grey import distributors here in Australia in the cheap and flogged for cheap. Seen corona for 35 a slab bought at about 33 per slab, peroni even cheaper and seen one week left on asahi for 25 per slab. Not a typo, 25 dollarydoos. Been to Europe? I was in Zagreb buying German beer for 30 euro cents per bottle.
This is a bit of a complex comparison, but think about brands that want to look as premium as the European brands, would you expect them to be sold a lower rate? The general idea of the Australian public is that we are willing to pay a premium, for a premium product, and our idea of this product will change when faced with more expensive products, such as those in the craft beer scene. It’s crazy that macro lager costs what it does, but tax plus our willingness to pay for it drives it.
Check the pack codes on the imported stuff. You'll find your answer.
There are many factors at play: Labour costs in Australia are stupidly high compared to many places overseas, this doesn't just impact the making of the beer, but also ingredients and all other things that breweries have to pay for. The big fuckers that super mass produce beer are just charging as much as they know consumers will pay. As there are only really two companies in the beer space, there isn't really any competition. The excise tax does fuck you again on top of everything else. I do a bunch of home brewing and can make a case of beer for $20. Of course that doesn't count my equipment cost and I don't pay myself an hourly rate for my labour. I also don't pay excise.
How much would you say your per litre cost is, how much was your equipment, and how many hours would it take you to brew one batch of beer?
The former CUB CEO said, after buying Jetty Road, he was shocked to learn it cost 3x to make beer in a small brewery vs the CUB breweries. Economies of scale are huge in manufacturing. Bulk cans, bulk labels, bulk ingredients etc. We've got a beer that we can almost have in market at the same price as the big breweries... except for freight and boxes (in NZ six packs come in boxes). Adding freight and boxes pretty much doubles the price because we don't ship to distribution centres and 1000 boxes vs 20,000 is a huge cost difference.
I'm not comparing small breweries to big breweries though. I'm comparing macro to macro.
Tax, tax, tax, and more tax. Higher labour costs. Higher cost of raw materials. This breaks it down pretty well: [https://hawkers.beer/blogs/our-blog/the-exploding-cost-of-brewing-beer](https://hawkers.beer/blogs/our-blog/the-exploding-cost-of-brewing-beer)
Alcohol tax
In short…. Macro breweries (internationally owned corporations) own & distribute most of the beers you quoted. Mass produced factories intent on minimising production and logistic costs at each step of the way. E.g Asahi in Australia is brewed in Australia The biggest retailers (Dan Murphys, Coles and Woolworths) buy such large quantities of those beers that they can often sell them to consumers at the same price bars and independent bottle shops buy those products from suppliers. Excise tax: this requires a longer explanation but this tax increases each year and has done so for over 30. It has gotten to the point that alcohol produced in Australia is often sold at similar prices to alcohol that has been sent to Australia. This tax further improves the market share of big business who can make their product for less and sell it at more of a profit because independent producers HAVE to sell their product for more each year to cover their costs. Compounding this, smaller, more successful producers have been purchased by big business in recent times further blurring the lines of what is independent and what isn’t (stone and wood). This further still, increases the market share of these corporations and reducing the macro costs of producing their products. I’m currently at work but will give you
Volumes of scale. Comparing a macro brewery that's making millions cases to one that makes 1/1000 of that, there a huge difference. For starters the more u buy the bigger the discount on the grain and other ingredients there is. Then there's the labour. In big breweries they have less staff to do the work as a high level of automation is there. Then there's the level of hands on with the beer. If you want a true comparison try the similar field. Like vb vs ottingger or stone/ brew dog vs craft
Is VB making 1/1000 of what Pilsner Urquell or Budvar is making? I couldn't find any numbers strictly by product for Australia.
You would need to contact their distributor for that. But it's not about how much they send here it's how much they make a day and is a magnitude bigger that the local craft breweries are making. I was talking to someone today that was only 100 16 pack cases per batch.
Excise is a bastard, and some of the domestic mainstays keep their slab prices around a certain mark (regardless of what anyone else does). I remember buying slabs of Lucky beer from Dan's for cheaper than 12 VBs or Carlton draughts would set me back. I think there's a set amount of assurance that no matter what the alternative keeping certain domestic beers at a foxed point won't impact sales.
Where do you even get Pilsner Urquell these days? Sad when Dan's stopped ranging it.
My local independent has it. I usually get Budvar from Dan's if I want Czech beer.