Writing to the JDW chairman in an open letter about the recently announced beer price cuts, Calder praised Martin’s support in making cask beer more accessible but warned the breweries represented by SIBA felt the move could be “dangerous”.
“Your commitment to deliver value to your customers is admirable,” wrote Calder. “Making quality, independent beer accessible to the widest range of people is something we should all strive towards.
“However, your recent announcement that beer prices would be cut further has caused significant concern among the UK’s independent craft brewers whom I represent.”
Views on Brexit
He continued: “Regardless of their individual views on Brexit, many in the brewing community feel that selling a pint of beer for as low as £1.39 and creating the impression beer will remain that cheap is dangerous.”
Selling beer at such low prices meant it had to be made cheaply, he argued adding SIBA members consider their products to be premium and claim it should be sold as such.
“It is brewed with the finest-quality ingredients by artisanal people with real skills,” he continued. “It has genuine provenance from a brewer embedded in its community.
“It comes from a brewing business that reinvests its profit back into its local community.”
While selling a pint of cask ale for as little as £1.39 may have a broader appeal to many consumers, such as move does not support independent craft brewers who fear a further downward pressure on price, Calder wrote.
Increases in costs
“This combined with inevitable inflationary increases in all their costs,” his letter continued. “Our research shows that most brewers operate on very low profit margins and many struggle to survive in a very competitive market.”
There was also no political view on Brexit from within SIBA, added Calder, who wrote the organisation’s members were keen to make the most from whatever happens on 31 October, including trying to support the British economy.
“But moves like this signal a race to the bottom to the brewers that supply your pubs,” the letter continued.
He also requested a meeting with Martin to discuss the ethics around JDW’s move to reduce the price of cask ale across the company’s estate.
The full letter read:
Dear Tim
Beer Pricing
Your commitment to deliver value to your customers is admirable. Making quality, independent beer accessible to the widest range of people is something we should all strive towards. As a category, you are a huge supporter of cask beer. SIBA and JD Wetherspoon have worked successfully together on ensuring quality beer in your pubs through the FSQ food safety standard, and on promoting local breweries in your magazine.
However, your recent announcement that beer prices would be cut further has caused significant concern among the UK’s independent craft brewers whom I represent. Regardless of their individual views on Brexit, many in the brewing community feel that selling a pint of beer for as low as £1.39 and creating the impression beer will remain that cheap is dangerous. Beer sold this cheaply has to be made cheaply. The beer my members make is a quality, premium product and should be treated as one. It is brewed with the finest-quality ingredients by artisanal people with real skills. It has genuine provenance from a brewer embedded in its community. It comes from a brewing business that reinvests its profit back into its local community.
Selling a pint of beer for as low as £1.39 may appeal to consumers but it doesn’t support independent craft brewers who fear further downward pressure on price. This combined with inevitable inflationary increases in all their costs. Our research shows that most brewers operate on very low profit margins and many struggle to survive in a very competitive market.
SIBA does not take a political view on Brexit. We have helped our members prepare for a no-deal Brexit on the 31 October and are keen to make the most of whatever happens. We’re all trying to support British industries in a post-Brexit economy. Yourself more than most.
But moves like this signal a race to the bottom to the brewers that supply your pubs. I would like to request a meeting between us where I would be accompanied by a number of independent craft brewers. Particularly we’d like to discuss ethical, flexible pricing to brewers, which will allow customers, brewers and JD Wetherspoon all to prosper in a post Brexit economy. While ensuring value to the consumer, I would strongly urge you to commit to pay brewers a fair price for the beer they make.
Yours sincerely
James Calder
Chief executive
Society of Independent Brewers