Thursday, April 29, 2010

The Steep Price of Beer

Since after all, I did refer to Christmas, therefore, I should be in a celebratory mood, shouldn't I? What better way than to have a beer or two after work? Still, I can't help but being drawn to what the Carlsberg managing director, Soren Ravin said on Tuesday that the company will increase beer prices next month. Certainly, this news is likely to put a damper on my drinking! Okay, the word should be ‘unlikely’ rather than ‘likely’ because if you remember your Economics class, beer is one of those few products which enjoy inelastic demand. Anyway, this Carlsberg fella was trying to justify the price increase by explaining that the company was playing catch-up with the rise in price of raw materials such as malt and hops which have increased 10 percent on average over the past 5 years, blah-blah-blah. Of course, drinkers know that beer companies will just simply pass on the costs to consumers. In fact, he went on to express his company’s optimism that the industry will grow by about 2 percent this year. For sure, he is right – when I first heard the news of this impending beer price increase, straightaway I proceeded to Gatsby and downed two beers!

And talking about price increases, I wonder why when the cost of living is still edging skyward, yet salaries are stagnant for most people. They could do with a wage increase! Now I don’t know who Bill Coleman is but he has one quote attributed to him that I thought is very appropriate: “Lack of salary increase does create the belief that you’re underpaid, or certainly that you could do better elsewhere”. Haha, he’s right, y’know!

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