Hill Farmstead beers for sale at 1 West Dupont Circle Wines & Liquors in the District. (Fritz Hahn/The Washington Post)
Beer lovers revere Hill Farmstead, a tiny Vermont brewery known for its delicate, unfiltered farmhouse beers and hoppy-yet-balanced IPAs. They travel from all over to the small town of Greensboro and wait in line for hours for a chance to buy bottles of the Florence Wheat Saison or malty Arthur. After all, the brew-enthusiast Web site Ratebeer.com named Hill Farmstead “the best brewery in the world” this year, for the second time in three years; readers of BeerAdvocate.com have given Hill Farmstead a 100 percent rating, the highest possible.
But Hill Farmstead’s intentionally limited distribution network creates scarcity for beer lovers who want to taste what the fuss is about, or to make their friends jealous by tagging a bottle of the magic elixir on Untappd or another beer-rating app. Brewery owner Shaun Hill told the New York Times last year that he thinks beer is a perishable commodity, “just like lettuce or broccoli,” and he doesn’t like to ship it long distances. As a result, his beer is available only at the brewery, at ahandful of Vermont bars and on an even more limited number of taps in New York and Philadelphia.
Which brings us to the latest beer-related outrage to hit social media: In late June, a Twitter user spotted 750-milliliter bottles of four different Hill Farmstead beers on sale at 1 West Dupont Circle Wines & Liquors, on P Street NW near Dupont Circle. Arthur, a farmhouse saison; Dorothy, a dry-hopped farmhouse pale ale; and Brother Soigne, a collaboration released under the name of Grassroots Brewing, were marked $69.99. Florence, a wheat ale, was $59.99. Never mind that Hill Farmstead doesn’t like its beers being sold outside of Vermont: The real scandal was that Hill Farmstead sells most bottles at its brewery for $10 each. A tweet was sent to the brewery, and the @HillFarmstead account urged fans to call the store and complain.
Appearances aside, that practice is perfectly legal thanks to Washington’s “gray market” for wine, beer and spirits. Here’s how it works: In most cases, if a bar or liquor store wants to carry a certain beer, it calls the licensed wholesaler for that brand to arrange for purchase. But if a brand doesn’t officially distribute its beers in the District, the bar or liquor store can serve as an unofficial distributor, per Alcoholic Beverage Control regulations, as long as it pays a $5 import fee for each shipment and pays tax on the amount of beer it brings in. (Right now, that’s a minuscule $2.79 for each barrel of beer, a volume equivalent to two kegs.)
It doesn’t matter how the bar or store acquires the alcohol: It could place an order and have it shipped directly from a brewery; it could purchase the beer at a brewery, like any other customer; or it could pick it up in person at an out-of-state liquor store and drive it back.
1 West Dupont, where the Hill Farmstead was spotted, has a reputation for stocking beers from well-regarded breweries whose products rarely reach Washington, such as California’s Russian River and Indiana’s Three Floyds. A visit last week found single 750-milliliter bottles of Lost Abbey Devotion, a Belgian blond ale, for $25.99, and Port Brewing’s High Tide Fresh Hop IPA for $19.99. Lost Abbey and Port are brewed in California, and neither distributes beer in the Washington area; Philadelphia is as close as they get.
Prav Saraff, the director of operations for 1 West Dupont, describes those self-imports as “a handful” of the 500 to 600 beers that his store sells. He says they’re acquired “whenever we come across them. If someone’s selling them, or if we’re traveling and I see them, then we can import them.”
However 1 West Dupont gets its hands on the beers, they don’t stay on the shelves for long: A shipment of Russian River Pliny the Elder or Redemption sells out “in a day or two at most,” Saraff says, because some customers regularly stop by to look for new acquisitions. (1 West Dupont’s rarities aren’t limited to out-of-market products: The store also has bottles of Founders Kentucky Breakfast Stout, $29.99, and Goose Island Bourbon County Stout, $19.99, which make it to this area every year but quickly sell out through the usual channels.)
Saraff said he wishes he could get beers like Pliny the Elder or Hill Farmstead more frequently, “but I don’t think these beers can be had regularly.”
Alongside a reputation for rare beers, 1 West Dupont has a reputation for large markups, as that $70 for a bottle of Hill Farmstead would demonstrate. A quick online search shows liquor stores in Pennsylvania and New Jersey selling that Lost Abbey Devotion for half or a third of the 1 West Dupont price, for example. The store’s Beer Advocate and Yelp pages are full of people complaining about exorbitant prices for beers while grudgingly admitting you can’t find those beers anywhere else.
Retailers taking advantage of secondary markets are nothing new in the worlds of bourbon and wine: Every other newspaper in America has written a story detailing the hunt for Pappy Van Winkle bourbon, breathlessly reporting that the 23-year-old expression, which has a suggested retail price of $249, can sell for up to $2,600. Better wine stores regularly buy entire wine cellars lock, stock and barrel before reselling the bottles.
That phenomenon has been growing in the beer world for years: There is such demand for some beers, such as Cigar City Brewing’s Hunahpu’s Imperial Stout and Three Floyds Dark Lord Russian Style Imperial Stout, that they’re sold for one day only at the breweries, with customers able to buy a limited number of bottles. And yet those seemingly controlled beers still make it to market: 1 West Dupont has bottles of both in stock for $129.99. For comparison, Dark Lord bottles sold for $15 each on Dark Lord Day.
While a liquor store selling a lone bottle of beer for three or even seven times the original retail price causes consternation in beer lovers and the people who brewed those beers, on the whole the gray market is overwhelmingly positive for the District. In fact, there’s a long history of beer importers using it to build the city’s beer scene: Back in the 1970s, the owners of the Brickskeller drove a refrigerated truck across the country, buying beer along the way. Once they returned to town, they introduced thirsty Washingtonians to the delights of Anchor Steam and Coors.
Even today, it’s easy to argue that Washington-area beer lovers would be worse off without bars and shops self-importing beers. Those gray-market distributors are the reason Florida’s Cigar City and Michigan’s Short’s can hold tap takeovers at D.C. bars without the beers getting tied up in red tape or lost in a warehouse. (In fact, they made it possible for ChurchKey to sell Hill Farmstead beers on draft during the 2013 Craft Brewers Conference, an event that had Hill’s blessing.) They allow for beer bars to expand customers’ palates: The Black Squirrel, for example, was road-tripping to North Carolina to buy beers from Sweetwater and Mother Earth years before those beers “officially” appeared in the District. And, to the relief of most consumers, the Squirrel charged a fair market price for bottles — usually around $6 or $7, similar to prices for more common IPAs on the menu.
And, more important to our local scene, the gray market allows up-and-coming Virginia breweries such as Adroit Theory, Heritage and Ocelot to bring their beers to D.C. bars and tasting events, introducing their products to people who might later visit the brewery or venture over to Virginia to buy six-packs and growlers.
To be sure, the gray market also allows for some bad actors, who are happy to buy cheap and sell high to local beer lovers on a quest to try something they’ve never had. It’s easy to understand why anyone would be annoyed by a store or bar charging insanely high prices for a favorite beer from the other side of the country. But the benefits of the loopholes far outweigh any problems with overcharging, and they’re part of what has created Washington’s lively and diverse beer scene.
Hahn, a longtime nightlife writer for the Weekend section, now writes the Beer column monthly.
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