26 May 2014

Oops! Missed this!

It completely escaped my attention that I didn't blog last week. Had I blogged, I would have brought up this story.

Four Corners Brewing Company is brewing a beer exclusively for Pecan Lodge, a BBQ place that opened in Dallas on the 23rd. Called Boss Lady Rustic Red, it is an amber ale, dry hopped with a "very special hop" that goes well with barbecue.

Okay. Sounds good. I just have one question: I thought this was illegal.

A couple of years ago, Walgreens introduced a private label beer exclusive to their chain, and a lot of people were up in arms about it.

Essentially, Pecan Lodge, Walgreens, Trader Joe's, and H-E-B are now "tied houses". A tied house is a retailer that is buys at least some of its beer from a particular brewery. In these cases, sells a beer that is available only at their locations. Tied houses are illegal in Texas, because it is a violation of the three tier system. Not only that, private labels of any kind amount to price collusion between the manufacturer and the retailer. Often, private labels, be they beer, cigarettes, canned vegetables, are often loss leaders, used to get people in the store.

Walgreens (and H-E-B also does with their Frio Light) gets away with it by selling allowing the beer to be sold to a couple other locations outside the chain. In the article I just linked to, the author says she can buy the H-E-B private label at a convenience store she shops at. Four corners will sell Boss Lady at their brewery, so that's their loophole. I haven't been to a Trader Joe's in Texas, so I don't know if they sell their private label beers here, or what other outlet carries it.

I guess this is just another case of "Money Talks. . ."

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posted by Jeff Holt at 08:00

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