The world’s largest beer company recently confirmed that it’ll jack up prices on American beer drinkers this fall—just like it did last fall, and the fall before that. Do you detect a pattern? And do you think the pattern provides a reason to stock up on beer each summer, before the annual price hike kicks in?
Anheuser-Busch InBev recently informed the St. Louis Post-Dispatch that it will indeed be increasing the price of Budweiser, Bud Light, and other beverages in the near future. “By now the fall price hike ought to come as no big surprise,” the post reads. “A-B raised prices by 3 to 5 percent last fall. They raised them in 2010 as well.”
A company executive explained that ingredient costs are rising in the “mid-single-digits,” and the price of beer is expected to rise accordingly, in the neighborhood of 5%. Why, you might be wondering, do all the beer price hikes seem to be taking effect in the fall?
Generally speaking, prices rise during specific seasons because they’re in higher demand at that time of year. Bacon, for example, tends to get pricier in summer because that’s when tomatoes are harvested—and it becomes prime BLT season. Candy and jewelry are much more expensive during the period just before Valentine's Day than they are just after the obligatory romantic gift-buying holiday has passed.
Likewise, prices decrease when consumer demand falls or supply soars. A dealnews post listing the best and worst things to buy in August states that shoppers can expect barbecue grills and swimsuits to be much cheaper now than they were in July or the beginning of the summer. A Lifehacker post naming the best times to buy nearly anything in 2012 says that late August through September is “the best time to stock up on wine” because prices dip during harvest time, a period of abundance.
Beer prices don’t seem to follow the established patterns, however. Few shopping sites weigh in on the best time of year for beer prices, but a Dollar Stretcher post suggests “all summer especially around holidays such as Memorial Day, Labor Day and July 4th,” as bargain season for all beverages, including soda, beer, and juice. According to Beer Institute data, this period happens to be when the most beer is bought. The amount of beer shipped within the U.S. hits a peak in the May-August period, before falling into a lull in the fall, which lasts until a spike in March—the month, by no coincidence, when St. Patrick’s Day is celebrated.
It would make more sense, then, for beer companies to raise prices before or during the summer, when demand was highest. Then again, there may be other factors at play. During the summer, beer may be more of a discretionary purchase; if prices are cheap, you might buy two cases of beer rather than one for that family barbecue. In the fall, two groups are all but guaranteed to buy beer regardless of price: college students and football fans. So maybe the beer companies can sneak in the price hikes in autumn without disturbing the sales flow too much.
In any event, it looks like there is increasingly a “case” (so to speak) to be made for stocking up on beer during the summer, before what seem to be an annual price hike takes place. Next, follow that up strategy by stocking up on relatively inexpensive wine during early fall’s harvest season.
In theory, this could mean that you wouldn’t have to visit the liquor store for months. Perhaps you’d even have plenty of beer and wine to last through the winter holidays. Then again, such stockpiles have a way of slowly, mysteriously disappearing.