That’s right. Heineken Malaysia Bhd has significantly increased the prices for its products (as of Sunday, April 15). The Locker and Loft was notified a few months ago.
Tiger, which used to cost RM658, now costs RM696, and Guinness (also RM658 before) now costs RM710. It’s a big jump. The prices should go down since the currency situation has improved.
No explanation was given, as usual. We’re expected to swallow this quietly while it dampens the consumer sentiment.
This brings me to my next point. You may not know, but breweries will charge you more when you buy beer in bulk.
One Tiger can be purchased at a supermarket for RM6 or less (duty-paid & legal). This is for an individually packaged product, which is obviously costlier to produce sto,ck tra, sport, and recycle. We deliver a large deposit to receive the beer in a REFILLABLE 30-liter keg. In addition, we have to pay for gas and the stakes for the beers.
The cost of one Tiger at a retail outlet (excluding the CO2 purchase) comes to RM7.73. That’s closer to $8 (excluding all overheads). Supermarts probably get it for RM4+.
This is absurd. The bulk price should be much lower when you purchase a product in 330ml vs. 30,000ml. If a supermarket gets its individually wrapped beers for RM4, then bars should call them at less than RM4 when refilled in our kegs.
Not RM8. By a wide margin. It sounds like there’s some profiteering going on.
Breweries will cover this by lending (or providing) a kegging unit and offering monetary incentives to reach “sales targets.” It’s not the outlet’s job to meet a brewery’s sales targets. We aren’t usually the ones that handle it. This is their job.
In essence, the brewery penalizes and rewards. The brewery punishes bars for overcharging and rewards them with incentives. It is absurd.
He couldn’t answer my question. (HMB’s Sales Department is not well-known. It’s a well-kept secret. ).
The brewery is going in the opposite direction. At a moment when many new bars have sprung up and are revitalizing the beer market by offering drinks for very low prices, they go the other way. It’s very frustrating. This could lead to a significant drop in consumption. I don’t think that outlets with reasonable prices (who already make very thin margins) will be able to absorb the increase.
Maybe HMB prefers quick margins over volume.
The Breweries don’t seem to be able to communicate or cooperate with their customers (outlets).
As far as I know, HMB did not consult the industry on the proposed increase. I doubt that there was ever a two-way discussion about the future of beer.
If outlets like Uncle Don’s and Brewhouse expand, they may soon reduce HMB’s share of the market. Carlsberg beer is available at RM10 a bottle all night long.
The problem with a duopoly, however, is that it appears as if both breweries are conspiring to raise prices simultaneously. This practice is now a crime.
They’d still do it.
Then I suppose it’s time for more house parties and untaxed beer.
Did you know the breweries were partly responsible for the tax increase on certain spirits in the past year? I was the founder of Alcon, and I dealt with breweries intermittently as I fought the authorities over the high alcohol taxes. I was surprised by their approach.
Breweries have been pushing for years to tax alcohol based on its strength. The higher the alcohol content, the higher the tax. Last year, the government finally listened. Tariffs and prices of high alcohol spirits such as absinthe and some gins, rums, and others have been increased.
Then it bit them on the arse. Breweries have reduced the alcohol content in their products to reduce their alcohol taxes. This has compromised their brand.
The company has also kept the information to their customers very low-key.
The legendary Guinness Foreign Extra Stout has become a myth. It’s watered down. It’s a shadow version of the former bulldog. This would be disrespectful to the brand and could have long-term consequences. In either case, I think it’s about time to remove “Extra” as a part of the name.