CHEAPER BEER.

Taranaki Central Press, Volume IV, Issue 416, 24 April 1937, Page 7

CHEAPER BEER.

A BREWERIES “WAR” Move To Force Sales. Sydney, April 17. Last week a beer war broke out between Victoria and New South Wales. It was announced that henceforth Richmond bottled beer and stout, which are brewed in Melbourne, would be reduced 2d and Id a bottle in ' Sydney, Newcastle and Maitland, which means that the bottled beers and stouts brewed in Sydney have been undercut to the extent of Id and 2d a bottle. At first, the Victorians were, inclined to denreeate the suggestion that “war is on.” but Mr Hood, who represents the Richmond brewery here, admitted that the purpose of this reduction is to popularise Richmond beer in New South Wales. This certainly means industrial competition, which is not far removed from industrial war, and so the New South Wales hotelkeepers regard it. But they have no particular reason to be disturbed by this attempt to cub prices, for they are in a very strong position. Of the 1400 hotels licensed in New South Wales, no less than 1300 are controlled by New South Wales breweries, and out of 535 hotels in the county of Cumberland —which includes Sydney—the Richmond company owns 24. “Why* should we worry?” expresses accurately the frame of mind which Sydnev hotelkeepers and brewers regard this innovation. On the other hand it must be understood that the champions of Richmond beer have some reason for satisfaction, as their sales in this State jumped promptly as soon as the “cut” was announced. Mr Hood pointed ouf that, as the local hotels will not stock Richmond beer and stout, his company has taken ouite a legitimate step by endeavouring to force the sale of their own product. As to the economic prosnects of the venture, Mr Hood believes that an increased turnover wi’l Boon justify the reduction in price of the Victorian brews. It was expected that the Sydney hotels would react to the cut by reducing the prices of local beer and stout, but apparently they have no intention of doing so. In fact, they are affecting to ignore their rivals as completely as possible and to maintain the price of local beers at their ordinary level. It is not clear how the Victorian “pirates” expect to hold the ground they are gaining except by cutting profits as well as prices, but the Victorians strongly resent the suggestion made here that Richmond bottled beer can be sold more cheaply than the Sydney product, because the wages of brewery employees are lower in Melbourne than here. Mr Hood has stated publicly that this argument is quite fallacious, because the brewers actually pay far higher wages in Melbourne than in Sydney. According to Mr Hood, the ordinary worker in a Melbourne brewery gets £5 a week, and coopers get £7 4s a week—wages far higher than are paid here. The minimum wage in Sydney is £4 15s, and in Melbourne £5, so that critics mu.st look elsewhere for an explanation of the curious that even after freight charges are paid Melbourne beer and stout can be sold here at a lower price than the local brews.