Tuesday, April 22, 2008

Booze Problems in the fine city of San Diego

I remembered reading about an article about beer prices continuing to rise for San Diego Padres games. While I wasn't overly shocked by it - San Diego has quite the expensive lifestyle compared to Milwaukee - I was a little upset by the fact that they're distributing water-down beer!!

I'll post three articles in succession. The first regards the beer prices in San Diego. The second is only a few days old where tests were done showing the beer isn't as strong as it should be. The third is in response to it by the Journal Sentinel.

Ballpark suds'll soak you
Padres' beer prices up 4th straight year, as high as $9

By Michael Stetz

March 29, 2008

The San Diego Padres have some kind of streak going. And it's got nothing to do with playing ball.

The team's organization has raised most beer prices every year since moving downtown to Petco Park in 2004. Opening Day is Monday and guess what: The streak lives on.

Pat Morris of Hillcrest carried a beer and a hot dog to her seat last night at the Padres game at Petco Park. The lowest-priced ballpark beer has risen to $6.50 for a 16-ounce domestic draft.

This season, prices will increase on all beer sold at the stadium, with the most expensive being $9 for premium brands. Last season, they were 50 cents less. The cheapest beer is now $6.50 for a 16-ounce domestic draft, up 75 cents.

All major league ball clubs charge a lot for beer, and all keep a close lid on how much they're making from it. The Padres are no exception, but we did some math of our own.

Information on beer pricing is available through the California Department of Alcoholic Beverage Control. Local beer distributors post the prices they charge area retailers. The Padres' vendor doesn't receive a discount for buying in bulk. That's against the law.

According to ABC records, a keg of Bud Light costs $76. That keg holds about 1,984 ounces, which produces about 99 20-ounce cups. The Padres charge $8.50 for a 20-ounce cup of Bud Light, meaning a single keg produces as much as $842 in sales.

The local distributor charges about 93 cents for a 12-ounce bottle of Heineken. That bottle, considered a premium brand, sells for $9 at Petco.

Even though Petco Park is partly owned by the city of San Diego, the city receives nothing from concession sales during games. Still, the Padres don't keep all the beer dollars.

The team must pay taxes and the vendor's cut, which the Padres wouldn't disclose. Sports retail experts say teams typically get between 40 cents and 50 cents per dollar on beer sales.

Why do the Padres – who have the final say on prices – charge so much for a simple beer?

The Padres say they're vastly different from a neighborhood bar, given their overhead and the limited dates they're open for business. The team also wants to discourage excessive drinking through higher prices, an executive said.

Not everyone buys that. Spectators in today's ballparks are treated like “captive prisoners,” said Bill Sutton, associate director of the DeVos Sport Business Management Program at the University of Central Florida.

“They're locked up and can't get out,” he said, which gives teams leverage when it comes to pricing their concessions. “It's a crazy mentality.”

Beer prices at Petco are even higher than at the trendy Gaslamp nightclub Stingaree two blocks away.

A pint of beer costs $6 there and beer prices haven't been raised since the club's opening in 2005, said Ali Pouladin, lead bartender. A bottle of domestic beer costs $5.

“That's a lot for a beer,” he said of Petco's prices.

Out of control

Up the road, in Anaheim, the most amazing thing happened five years ago. The Angels actually lowered beer prices. The new owner, Arturo Moreno, thought prices had spun out of control and cut some by up to 20 percent. The Angels still haven't increased the price of a 14-ounce beer at Angel Stadium. It remains $4.50 this season.

The move by the Angels hasn't exactly caught on league-wide, which might seem surprising. Fans loved it. And the Angels say the lower prices haven't resulted in more booze-fueled boorishness.

But the Padres say higher beer prices help maintain a family-friendly environment, which is one of the reasons they're more aggressive in raising those prices instead of others, said Richard Andersen, executive vice president in charge of ballpark management.

“We don't want to do anything to encourage excessive alcohol consumption,” Andersen said. “We want people to have a beer or two if they like. We're not interested in attracting people who want six or eight beers.”

Most concession prices at Petco aren't rising this year, he said. Of the 98 items offered, 57 remain unchanged. Peanuts are still $4.50 a bag. Popcorn is still $4.

The Friar hot dog will cost $4, up 50 cents from last year.

Andersen declined to say how much beer is sold during a Padres season, though the Boston Red Sox reported selling 3.1 million beers in 2004, with an attendance of about 2.8 million. Last year, the Padres attracted about 2.7 million.

Andersen did say the volume has remained pretty much consistent year-to-year, despite the annual cost increases.

The economics of beer works like the economics of everything else, experts say. A price can be set too high, discouraging consumption. Price beer at $30 a bottle and see what happens.

But sports concessions are free of one key element that exists in the open market: competition.

If a number of enterprises were allowed to set up shop and fight for the beer dollar, costs would drop. But the chance of that happening is about as likely as the Padres getting Alex Rodriguez.

Sutton questions the business approach many sports teams take with pricing, particularly in these tough economic times. If the customer believes he is being gouged, he'll begin to harbor negative feelings toward the franchise, he said. If the team performs badly, where's the incentive to hang with the club?

“That's not good long-term thinking,” he said.

Bitter taste

Beer has always been a big part of baseball. Breweries once owned teams. Today, a number of beer companies – Miller, Coors and Busch – pay to have their names on ballparks.

Years ago, fans could actually bring their own beer into some stadiums. That was the case until 1984 for the Padres, who played at Jack Murphy Stadium, now Qualcomm. Then the team complained that alcohol-related problems were increasing.

Other baseball teams banned carry-in beer, saying the change was needed to create a better ballpark environment. But there was another reason: money.

Paul Fordem, a San Diego County supervisor at the time, complained that the new ban granted the Padres “an absolute monopoly” on stadium concessionaires.

Talk about vision.

Another supervisor, Paul Eckert, wondered why, if the Padres organization really wanted to solve the alcohol problem, it wasn't banning all beer-drinking at games.

Today, fans keep forking over the money for beer, even though the prices can leave a bitter taste in their mouths. At an exhibition game last night at Petco Park against the Angels, the new beer prices were in place.

And even though fans said they've grown accustomed to higher prices, nobody was exactly applauding another increase.

“You come here expecting to pay a lot,” said Geoff Longenecker of La Jolla, who was sipping a Stone beer, which set him back $9.

He called the prices, “extraordinarily high,” yet was happy that at least the variety was broad.

Christina Curtin of Mission Valley said she should could buy a six-pack for what she paid for a single beer, a premium draft for $9. But she said she expected it, given that she was at a baseball game.

Marc and Jodi Stein of El Cajon said having a beer or two is part of the baseball experience, so they forked over $16.50 for two beers.

The guy behind the counter forewarned them that the price was going to be ugly, Marc Stein said. “He said, 'Believe it or not, it's $16.50, and you don't get a TV set with it.' ”

Staff writer James P. Sweeney and staff researcher Erin Hobbs contributed to this report.


For it's 1, 2, 3.2 at the old ballgame

Beer is high on price, low on alcohol content
By Michael Stetz

April 18, 2008

SEAN M. HAFFEY / Union-Tribune

Kevin Kimball, of San Diego, enjoyed a Bud Light last night at Petco Park. More bucks, less bang.

Padres fans already know beer sold at Petco Park has a higher price tag than the same thing elsewhere. But they might be surprised to learn some of the beer also has lower alcohol content.

Three of the downtown ballpark's domestic draft brands – Budweiser Select, Miller Lite and Miller Genuine Draft – contain 3.2 percent alcohol by weight.

Go to a bar and most regular domestic draft beer will have about 4 percent alcohol by weight. Most light beers run about 3.4 percent.

In other words, it's not just the Padres' batting lineup – producers of only six home runs so far this season – that's weak.

“It's kind of upsetting,” said Randall Brooks of Ventura, who was unknowingly drinking a 3.2 percent beer, a 20-ounce cup that set him back $8.50 at Wednesday's Padres game. “I should get what I'd get anywhere else.”

Padres fans at Petco Park might be surprised to learn some of the beer sold there has a reduced alcohol content.

By the numbers

There are two ways to measure alcohol content in beer: by weight and by volume. For lower-alcohol beer, the 3.2 percentage refers to alcohol by weight. The strength of various beers, in comparison:

4.0% Budweiser
3.4% Budweiser Select
4.0% Coors
3.4% Coors Light
4.3% Stone Pale Ale
4.0% Heineken
3.7% Corona
3.7% Miller Genuine Draft
3.4% Miller Lite
Online: For a March 29 story about rising beer prices at Padres games, go to uniontrib.com/more/beer

The Padres aren't required to divulge the alcohol content of the beer they sell. There's no mention at the concessions, which are run by a vendor called Sportservice, that the three brands are any different.

Padres officials say lower-alcohol beer, like higher prices, is part of an “alcohol management plan,” meant to keep fans from overindulging. They also say it's common practice in the sports industry and hardly limited to Petco.

It's unknown how many professional teams' vendors sell 3.2 percent beer at stadiums. Sportservice, a subsidiary of Buffalo, N.Y.-based Delaware North, runs concessions in as many as a dozen professional sports venues. Company officials didn't return phone calls.

Centerplate, which runs the concessions for the San Diego Chargers at Qualcomm Stadium, didn't return calls, either.

“The Padres aren't alone,” said Chris Bigelow, president of the Bigelow Companies, a consultant to sporting and entertainment venues on food service management.

He said the difference in the quality of the beer is difficult to tell, “especially after the first one.”

The decision on what kind of beer to buy rests with Sportservice, said Richard Andersen, executive vice president in charge of ballpark management for the Padres. The difference in alcohol isn't that dramatic, he said.

The difference in cost is 32 percent. A keg of Budweiser Select goes for $76, according to California Department of Alcoholic Beverage Control records. The 3.2 percent version of Bud Select runs $52.

“Wow, $8.50 for low-octane beer,” said Michael Shames, a consumer advocate who heads the Utility Consumers' Action Network in San Diego. He compared the move to that of oil companies, which have been accused of reducing octane in gas.

Bars don't peddle the lower-alcohol stuff, said Greg Anderson, owner of McGregor's Grill and Ale House near Qualcomm Stadium. “It's not a practice in the bar industry, as far as I know,” he said.

Stephen Zolezzi, executive vice president of the Food and Beverage Association of San Diego, said that to his knowledge, distributors don't offer such beer to local bars.

Zolezzi said he thought sports venues were required by law to sell lower-alcohol beer, but the ABC said no such law exists.

Petco's premium draft brands, such as Sam Adams, which contains 3.9 percent alcohol, are not lower-alcohol versions. The bottled beer is also the same you'd find anywhere.

Lower-alcohol beer has been sold at Padres games for years, according to the Padres organization. When the team moved from Qualcomm Stadium, the 3.2 beer – called “stadium beer” among some in the industry – made the ride to the downtown digs as well.

But today's higher beer prices could make the lower alcohol content harder to swallow. In 1988, a beer at a Padres game was $2. When adjusted for inflation, that $2 beer would be $3.61 today. The cheapest beer at Petco now is a 16-ounce domestic draft for $6.50.

“It's just another example of companies fleecing the public,” said Mark Reback, of Santa Monica-based Consumer Watchdog. Consumers are facing higher prices not only for necessities such as gasoline and food, but also while enjoying a simple baseball game, he said.

“Where does it end?” asked Reback, who recommended fans lodge complaints with any teams that sell weaker beer.

The 3.2 percent beer dates to Prohibition. Just before the booze ban was repealed in 1933, Congress allowed for 3.2 beer in an effort to jump-start the economy during the Depression and appease those clamoring for the right to imbibe.

After the repeal, beer makers started producing stronger beers, but several states kept the 3.2 standard. Today, six – Colorado, Kansas, Minnesota, Missouri, Oklahoma and Utah – continue to require that some retailers, such as grocery stores, sell the lower-content product.

Beer lovers in those states routinely complain about the quality of the beer.

Brewers basically add water to lower the alcohol content. Some critics maintain that brewers bring the content lower than 3.2, to make certain the beer passes muster in those states.

Anheuser-Busch – maker of Budweiser Select, among other brands – did not return calls.

Kathy and David Pence from Montrose, Colo., who were at the Wednesday Padres game, said they try to avoid 3.2 percent beer at home.

“We go to liquor stores to buy our beer,” said David Pence, because those outlets are allowed to sell the full-strength stuff.

The Pences weren't aware that Petco sold 3.2 percent beer, and they didn't understand the reasoning offered by the Padres. “If people want to get drunk, they're going to get drunk,” Kathy Pence said.

Not everyone minds the less powerful beer.

“To me, it's a minor thing,” said Rick Atwood, who was at the game drinking Miller Lite. “If they were doing so to a microbrew, that's a different story.”


Your beer, your stadium
By Don Walker

Tuesday, Apr 22 2008, 09:41 AM

First the good news. Miller Park, home to the Milwaukee BREWERS, for crying out loud, does not serve beer with 3.2% alcohol by weight.

But they do at Petco Park in San Diego, according to this story. And the fans didn't know it.

Here's the key phrase in the story: "The San Diego Padres aren't required to divulge the alcohol content of the beer they sell. There's no mention at the concessions, which are run by a vendor called Sportservice, that the three brands are any different.

"Padres officials say lower-alcohol beer, like higher prices, is part of an 'alcohol management plan,' meant to keep fans from overindulging. They also say it's common practice in the sports industry and hardly limited to Petco."

Scary stuff if you're a beer drinker. Sportservice, by the way, has the concessions contract at Miller Park. And, as mentioned, officials there told me you get the real deal in the beer lines. No 3.2% beer for Brewers fans.

Sportservice is a huge company and has concessions deals with dozens of sports stadiums and arenas around the country. Naturally, we wondered if there were other stadiums that did the same thing.

A Sportservice spokesman said the practice at Petco was the exception, rather than the rule.

"The type of draft beer being served at Petco Park in San Diego is consistent with draft beer being served at many stadiums and large public gathering places in the state of California. This practice began at Qualcomm stadium under another concessionaire, and was carried through to the new ballpark," the spokesman said in a prepared statement.

In San Diego, opinion appears to be divided on the practice. Some cared, some didn't.

In the meantime, we'll keep you apprised whether this practice goes on at other stadiums around the country.

Labels: , , ,


Anonymous Anonymous said...

This is a deceptive practice, and should be illegal, one of the reasons I no longer have great intrest in going to games, I dont like being taken advantage of , it is not dignified , they gouge the public on price , then water it down , THEN TO TOP IT OFF THEY WATER IT DOWN. NO CLASS BAD BUSINESS PRACTICE .

3:43 PM  

Post a Comment

Subscribe to Post Comments [Atom]

<< Home