Purchasing Beer By The Barrel: How Much Does It Cost?

The cost of a barrel of beer depends on several factors, including the type of beer, the brand, and the reseller/distributor. A half-barrel keg, which is the standard size in the US, typically holds around 15.5 gallons of beer and can cost anywhere from $79 to $200, with an average price range of $100 to $200 for craft beer and $100 for domestic kegs. The price of a barrel of beer can also vary depending on the market and location, with additional costs such as deposits, party pumps, and cups. When purchasing a barrel of beer, it is important to consider the number of beers required for an event, as well as the serving options, such as draft, cans, or bottles, which can impact the overall cost.

Characteristics of Buying a Barrel of Beer

Keg prices vary by brand and size

The cost of a keg varies by the brand of beer, geographic location, and reseller type. You may also have to factor in rental fees for the tap and keg tub to get the true price. There are also always refundable deposits required, which will increase the upfront cost by $30-100. The average cost for a tap deposit is $50-70, and the average rental fee for a tap is $10. The average rental fee for a tub is $6.

Some examples of keg prices by brand and size include:

• A half-barrel keg of Bud Light: $79 to $139
• A half-barrel keg of Budweiser: $87
• A half-barrel keg of Blue Moon: $175
• A half-barrel keg of Busch Light: $80
• A half-barrel keg of Coors Light: $90
• A half-barrel keg of Corona Light: $165
• A half-barrel keg of Heineken: $130
• A half-barrel keg of Guinness: $200
• A half-barrel keg of Keystone Light: $70
• A half-barrel keg of Miller Lite: $88
• A half-barrel keg of Michelob Ultra: $135
• A half-barrel keg of Natural Light: $80
• A half-barrel keg of Pabst: $100

The short answer for how much it costs to buy a keg is between $100 and $200. If we're talking about empty beer kegs, the three main factors to consider are the reseller/distributor and the size of the keg. A 1/4 barrel keg will cost less than a 1/2 barrel keg of the same brand. However, when it comes to different brands, things get complicated as certain manufacturers offer better quality (or additional features) and, therefore, charge differently for their products.

A deposit is required, which is refundable

When buying a barrel of beer, a deposit is typically required, which is refundable upon the return of the empty barrel. This deposit ensures that the seller receives their container back and encourages buyers to return the barrel promptly. The deposit amount can vary, but it is generally a small proportion of the total cost of the beer. For example, a half keg of Dos Equis Amber costs about $158 plus a deposit, while a half keg of Stieglitz Grapefruit is $220 plus deposit. The keg deposit is usually around $15.

The deposit for a barrel of beer can range from $30 to $75, depending on the market and the type of beer. For instance, a keg of PBR in Indiana had a deposit of $75, while a half barrel of Lite or Coors would be about $10 more. It's important to note that the deposit is separate from the cost of renting additional equipment, such as a party pump, which may require an additional deposit and rental fee.

The deposit is an essential component of the barrel-buying process as it helps to ensure the sustainable reuse of containers. By encouraging the return of barrels, sellers can reduce waste and minimize the environmental impact of their operations. This practice also helps to keep costs down for both buyers and sellers, as it eliminates the need to purchase new containers for each transaction.

It's worth noting that the deposit is separate from the cost of the beer itself. The price of a barrel of beer can vary depending on the brand, type, and market conditions. For example, a half-barrel keg of Bud Light can range from $79 to $139, depending on the distributor and the state. Craft beers tend to be more expensive, with prices ranging from $100 to $200 for a keg.

In summary, when purchasing a barrel of beer, it is standard practice to pay a deposit, which will be refunded upon the return of the empty container. This deposit is an important aspect of the transaction, helping to ensure sustainability, reduce waste, and keep costs down for all parties involved.

Additional equipment is needed, e.g. tap, pump

When it comes to buying a barrel of beer, there are a few additional pieces of equipment you'll need to get the most out of your purchase. Here's a detailed guide on the essential equipment:

Tap and Pump

A tap, also known as a keg coupler, is crucial for dispensing the beer from the keg. Different types of kegs require different couplers, so it's important to get the right one. The most common types are the D coupler for North American kegs, the S coupler for most European kegs, and the A coupler for German kegs. You can typically rent a coupler from the retailer where you purchase your keg.

In addition to the tap, you may need a pump to help draw the beer from the keg. This is especially important if you're serving a large number of people, as it ensures a consistent flow of beer.

Refrigeration

To keep your beer cold and fresh, you'll need a reliable refrigeration system. This can be a kegerator, a dedicated beer fridge, or a large cooler filled with ice. Maintaining a consistent temperature is crucial for the best-tasting beer.

Cleaning and Sanitizing Supplies

Proper cleaning and sanitizing of your equipment are essential to ensure the beer remains free of contaminants and infections. This includes brushes for cleaning the keg and lines, as well as no-rinse sanitizers to disinfect all surfaces that come into contact with the beer.

CO2 Tank and Regulator

Carbon dioxide (CO2) is used to pressurize the keg and force the beer out through the tap. A CO2 tank and regulator are necessary to control the flow of gas and maintain the optimal pressure for dispensing the beer.

Glassware and Dispensers

Depending on your serving needs, you may require glassware such as pint glasses or mugs. For larger events, you might consider renting or purchasing a beer tower or other dispensing equipment. Don't forget items like coasters and napkins to complete the serving experience.

Other Accessories

There are numerous other accessories that can enhance your barrel-buying experience. This includes items like a drip tray to catch any spills, a carrying handle for the keg, and personalized tap handles to add a unique touch.

Craft beer prices have increased due to inflation

The cost of a keg of beer depends on the size and brand of beer. For example, a half keg of Dos Equis Amber costs around $158, while a half keg of Stieglitz Grapefruit is $220. A half-barrel keg of Bud Light can cost anywhere from $79 to $139. The price of a keg can also depend on the reseller or distributor.

Beer prices have been steadily increasing due to inflation. During the last 13 weeks of 2022, beer prices at retail rose by an average of 7%, with some beers, such as Bud Light and Coors Light, increasing by 10%. Beer prices rose 5.9% in the 12 months through April 2023 and are up 72% since the year 2000. Inflation has affected beer makers with increased costs for ingredients, packaging, and shipping. As a result, beer producers have been forced to raise prices, with consumers footing the bill.

Craft beer prices have also been impacted by inflation. While they haven't risen as sharply as other goods, small breweries are facing higher costs for goods and freight and are considering raising prices. Historically, price increases have started with the biggest companies, with local breweries following suit later. With bigger beer brands already increasing prices, local craft breweries may soon do the same.

The impact of inflation on beer prices is evident in the rising cost of purchasing a barrel or keg of beer. The increasing costs of ingredients, packaging, and transportation have contributed to the rising prices charged to consumers. While craft beer prices have not increased as significantly, they are expected to do so in the future, particularly if inflationary pressures continue.

Draft beer has a higher profit margin than bottled/canned

The cost of a barrel of beer varies depending on the size and brand of beer. For example, a half keg of Dos Equis Amber costs about $158 plus a deposit, while a half keg of Stieglitz Grapefruit is $220 plus deposit. A half-barrel keg of Bud Light can cost anywhere from $79 to $139, depending on the market (plus deposit). The keg deposit is typically small, at about $15.

When it comes to profit margins, draft beer outperforms bottled or canned beer. While bottled beer has a profit margin of around 75%, draft beer can bring in a significantly higher profit margin of up to 80%. This is because draft beer is substantially cheaper per ounce, with the cost-per-ounce being 40-45% lower than bottled or canned beer. This allows draft beer to fetch a higher price point, resulting in a higher profit margin.

The pricing of draft and bottled beer is influenced by their respective pour costs, which is the ratio between the cost of products purchased and the revenue from products sold. Draft beer typically has a pour cost of about 20%, while bottled or canned beer has a slightly higher pour cost of around 25%. This difference in pour cost contributes to the higher profit margin for draft beer.

It is worth noting that draft beer has higher overhead costs than bottled or canned beer. The initial investment in equipment and maintenance for draft beer can be quite costly. Additionally, there are ongoing expenses for nitrogen, CO2, and other supplies needed to maintain the quality and freshness of the beer. However, despite these higher overhead costs, draft beer still offers a more attractive profit margin due to its lower cost-per-ounce and higher price point.

To maximize profits, bar and restaurant owners often offer both draft and bottled or canned beer options. This allows them to cater to a wide range of customer preferences and utilize different pricing strategies. By considering factors such as keg size, serving size, and overhead charges, establishments can optimize their pricing to achieve their desired profit margins.

Frequently asked questions