Let’s be honest, besides being delicious, one of the attractions of beer has long been that it’s relatively cheap, at least compared with wine and handcrafted cocktails. Enjoying a few cold ones at the bar, beer garden, or taproom ― responsibly, of course ― didn’t break the bank. But in recent years, the price gap between beer and other alcoholic beverages has been closing, a trend that has only accelerated because of the pandemic and inflation.
At a sports bar near Fenway Park, the $12 Night Shift beer on draft costs as much as a margarita. A Lord Hobo costs as much as a glass of Sauvignon blanc. A few blocks away, IPAs go for $10. At some places, a 20-oz. bottle of Maine Beer Co.’s popular “Lunch” IPA is $15.
A confluence of factors, such as rising food and labor costs, are coinciding with the ongoing proliferation of craft beers. The beer is getting better and the options are seemingly endless — but it’s also getting more expensive to make and sell. That’s causing a carbohydrate letdown of sorts when the tab arrives.
“Not everyone wants to go and spend $12 for a pint of beer,” said Naveen Pawar, founder of Mighty Squirrel Brewing Co. in Waltham. “Then you add the taxes and tip, it turns out it’s $15 per pint.”
Rob Burns, cofounder and president of Night Shift Brewing in Everett, said draft prices of his beer in Massachusetts can range from $8 to $14, including at its own taprooms, depending on the style and size of the pour.
“The prices are higher than I would like to see on the menu,” he said. “I don’t like a beer with a $10 on it, but we also have to price so we can keep operating and stay alive.”
Though beer prices may seem high to some customers, brewers say times are tough.
Jack’s Abby Craft Lagers, Harpoon Brewery, and Night Shift are among the local companies that have increased beer prices this year, though not high enough to cover the increased cost of fuel, malt, packaging, and other items. That means everyone’s margins are getting slimmer, said Sam Hendler, cofounder of Framingham-based Jack’s Abby, who is also president of the Massachusetts Brewers Guild, a trade organization.
The average cost of producing a batch of Lamplighter Brewing’s flagship beers has gone up 20 percent since 2020, but cofounder Cayla Marvil said the Cambridge brewery has only raised its prices between 3 percent and 5 percent during that period. Burns said that Night Shift’s taproom at Lovejoy Wharf in Boston has been packed with people in recent months, but “it’s not making a ton of profit, if any.”
The rising price of beer stems largely from a shift in which brands are on draft at bars and restaurants. Since 2007, the number of breweries in Massachusetts has ballooned from 30 to nearly 220, meaning more so-called craft beers are taking over taps that once dispensed less expensive mass-production beers.
“If you go back 10 years ago, what was on tap? Bud Light, Coors, Coors Light,” said Bob Luz, president of the Massachusetts Restaurant Association. “Now you see Jack’s Abby, Night Shift, fill in the blank. It’s a much higher-end product.”
Unlike the mega beer brands such as Anheuser-Busch InBev — which brews Budweiser, Corona, and Stella Artois — craft brewers don’t have the advantages of economics of scale. They source more specialized ingredients and have lower sales, raising the amount they have to charge per keg.
“Since the proliferation of locally sourced, high-quality brewers being able to distribute to restaurants, the cost of beer has increased towards the price of a glass of wine or a mixed drink,” Luz said.
On top of that, some restaurants and bars are raising beer prices to compensate for lost sales during the COVID-19 pandemic, as well as skyrocketing food and labor costs. Historically, sales of alcoholic beverages have yielded healthy profit margins that helped businesses make up for losses in other areas.
“A lot of that on-premise [price] is really driven more by labor costs than it is by the price of beer,” said Bart Watson, chief economist of the Brewers Association.
At restaurants and bars, brewers have no control over what prices customers see on the menu. Brewers sell to distributors, who sell kegs to restaurants and bars, and those establishments ultimately determine how much consumers pay for a pint.
Pawar said he understands that restaurants need to hike prices somewhere. And he believes people would be “more sensitive about paying $1 more for their burger compared to paying $1 more for their beer.” Though these days, burgers also are more expensive.
Despite the higher cost of beer ― which to a lesser degree is reflected in prices at liquor stores, too ― brewers and industry observers point out that even the most premium beers remain relatively affordable compared with most wines and spirits. Especially since many specialty beers are labor-intensive to produce.
Lamplighter’s barrel-aged sours, for example, must sit in a warehouse for two years before they are ready to be poured. “We’re not charging $50 for it,” Marvil said, even if that’s “the equivalent of what we should be charging.”'
Tom Acitelli, who wrote a book on the history of the craft beer movement called “The Audacity of Hops” and lives in Cambridge, said there are rumblings in the beer world that brewers should start pricing their products at a premium, “so people understand it as such.”
“Distillers, wineries in particular, have been setting these price points higher for years,” Acitelli said. “You can never underestimate the sort of allure of pricing something higher so people think it’s more valuable.”
But for now, some people are still getting used to paying double digits for a pint that not that long ago might have cost $6.
“Seasoned consumers understand and are not necessarily that shocked, but the newcomers probably are,” Acitelli said. “That’s bad news for breweries trying to grow their customer base.”