March 18, 2021 5 min read
Wine and beer have both been a trade profession - AKA years and years of perfecting their wonderful creation. You would think two beverages that take so much time to craft (unlike water + sugary powder) would have much more in common. So why is there a wine vs. beer relationship and not a wine AND beer relationship?!
Many people are aware of the stigma these two 21+ adult beverages have:
Wine = classy
Beer = blue collar
But what is the reason behind these stereotypes? Let's take a look at how wine and beer have changed in the last decade...
Beer is often considered less expensive than wine. Beer is made from: grain, yeast, hops and water. Traditionally, these are all inexpensive, though hops have gone from around $3 a pound to upwards of $20 a pound over the last decade (have you noticed beer prices have gone up a little?). From an ingredients standpoint, cost per gallon of a mass produced beer is incredibly low, pennies per gallon.
Grapes vary in quality depending on where they are grown. For example, grapes grown in California’s Central Valley are seen as lower quality grapes and are often used for base wine. Prices run from $3-$5
per gallon to produce if you own a vineyard and make your own wine.
So, pennies per gallon vs. several dollars per gallon is the biggest cost difference between beer and wine.
Looking back at the ingredients that make up beer and wine, you start to realize that beer can be produced quite inexpensively and from many different locations. One of the limiting factors of beer is hops. Though beer typically requires only a small amount to be added for flavor, they are harder to grow and are the most expensive ingredient. It would be pertinent to add that a lot of more popular expensive beers are hop-forward Double-IPAs and Triple-IPAs, so the price kind of makes sense.
Grapes can be grown in fewer locations than the main ingredients that make up beer because of the ingredients: grain and water. Grapevines will generally produce 3-6 tons per acre of planted land, but can get up to 8 or 9 tons depending on location and quality desired.
The upfront cost of a steel barrel for beer will be slightly less than an oak barrel for wine. Steel barrels must be maintained but can be used indefinitely. Oak barrels can be used for several years, but lose all flavor after about three years (most is lost after the 1st year).Many high priced wines use at least some amount of new oak every year, leading to a higher cost. A French oak barrel will run you about $850-$1300 per barrel. If you use 30% new oak every year, that can get quite expensive!
If the product being canned or bottled is a mere .50 cents a gallon, it doesn’t matter as much if it’s sloshing around, spilling on the floor or outright wasted. Sure it’s a shame to waste, but it won’t ruin your business. Say you lose 10% of what you package when canning beer. If beer costs $1/gallon, that’s ten cents per gallon being thrown down the drain. If the wine being canned is $10/gallon, that’s a whole dollar thrown in the trash. Much higher! When bottling wine, there is relatively small loss of product and wastage. When canning a wine, a newer trend, the process is very slow. If wastage occurs, it stings the pocket book a lot more, so it’s monitored
more closely. Check out our YouTube episode on the subject!
Even when you are dealing with the lowest of price points in both products, everyone along the supply chain takes a cut. The producer needs to make money...the distributor needs to pay for trucking, storage, salaries, etc...then, there are the stores. Stores and shops need to make a percentage to make buying the product worthwhile. This all adds to the cost of wine and beer on the shelf. Wineries have been selling direct to consumers longer than beer, but the beer world has caught on. This leads to higher profits for the producer, but not as much as many people think. The infrastructure of selling direct to consumers is expensive. Marketing alone can be a huge cost, not to mention the brew pub, tasting room and staffing.
Higher prices make people think “fancier”. When it comes to price, beer is not “less fancy” than wine. Price does make wine seem fancier since you can buy a wine from some producers for $100 or $1000 per bottle - beer, not so much.
Beer has kicked the pricing up dramatically in the last decade by creating more “premium” beer. These have more expensive ingredients -- more of them + low production = scarcity.
Wine is just as fancy as ever, but there are a lot more wine brands that are trying to buck that trend and make wine more approachable and accessible. They’re actually marketing their wine more like a beer company, making it more attainable and diminishing the “wine is more fancy” stigma. You can pay as much as you like for beer or wine, but the fun part is finding favorites that will not break the bank.
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