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Archive for February 16th, 2013

It used to be more easy. When I was young, everything was black or white. I won’t claim more wisdom now, but at least I have rubbed off some edges, most of them probably for the better.

But my reflexes are more or less the same. I have no love for monopolies – public or private. This means I have never applauded the Nordic way of organising alcohol retail sales in governmental monopoly retail stores, either.  But a recent briefing at the headquarters of Swedish Systembolaget made me think things through.

Four of the Nordic countries have these governmental shops, Finland (Alko), Sweden (Systembolaget), Norway (Vinmonopolet) and Iceland (Vínbúðin). Finland and Norway allowed the sales of beer (and alcopops) below 4.75 % ABV in supermarkets, In Sweden and Iceland the limit is lower. This makes a significant difference: In Sweden, the bulk of pale lagers is sold in Systembolaget shops, in Norway, the bulk is sold in supermarkets.

Things are slowly changing. There used to be monopolies of imports, wholesale and distilling, too, but they are history, largely do to European legislation. The retail stores used to be forbidding places with long lines outside the front doors and all bottles being hidden on shelves behind the counter. The strict Lutheran view of this being the devil’s dring hung like a dark cloud over the shops. There is one, frozen in time, at Norsk Folkemuseum in Oslo if you want to have a look.

The public health concerns are the same as they used to be, but the drinking habits have changed. We drink less hard liquor and more wine, the pale lagers are stagnating while craft beer has an impressive growth.

And the monopolies are adapting. Bright and cheerful stores with the full stock on display. Special release days for rare wine and beer. Apps for your smart phone. And while you won’t find any promotional material as such in a Systembolaget shop, the bottles, boxes, cans and wrappings for the six-packs do the job.

In theory, you could argue that the Norwegian threshold of 4.75% means there is a better choice of everyday beers for the consumer. But that is not the case. We have four supermarket groups controlling 98% of the grocery market, and, while there are some shops who are now jumping on the beer bandwagon, the range available is limited to about one hundred beers in the very best shops. Three quarters of these will be pale lagers, for Christmas some of them will have som caramel coloring added.

Sure, there are huge stacks of canned lagers in the Swedish shops, too, but the best of the shops have a large number of fine ales prominently displayed. And if you don’t find your favourites in your local shop, you can order them from the web site and have them in a week or so.

Sure, you might argue, but what’s the option for those who live out in the sticks and don’t have a Systembolaget store in the neighbourhood? Simple, there is a large network of grocery stores who act as agents or ombud and where you can pick up your order. Like the post offices who pop up as shop within a shop nowadays.

One major difference between Norway and Sweden is that the Swedish model is put under strong external pressure. As European Union citizens, the Swedes are free to bring home alcohol bought in other EU countries cor their own consumption. That means cheap booze from Denmark, Germany and Poland. Which means that Systembolaget have been forced to give a better shopping experience, better service – and to keep their prices down. Sur, they cannot underbid the prices of Polish vodka. But they can make sure that you can get a six-pack of lager for an affordable price without getting on a ferry. That means the price level in Sweden is often between thirty and seventy per cent of the prices in Norway for beer and wine. A decent can or bottle of BrewDog beer will typically be ten Norwegian kroner at Systembolaget but close to thirty in a Norwegian supermarket. Going into how we end up with this difference is a blog post of its own.

So. Accessibility and price are two factors which make the Swedes smile all the way to the shop and back. But it’s also a matter of quality.

When we visited Systembolaget HQ, we were attending a simulation on how they conduct their product testing.

Their buyers try to follow the trends in the beer world, to stock Swedish beers and imports, to try to have a sensible mix of beer types, price levels etc. The beers that sell well get to keep their place on the shelves, others are replaced. And there is a steady flow of calls for tender, stating the type of beer, possibly area of origin and stating something about the price level, say, 15-20 Swedish kroner for a half liter bottle. Depending on the product, importers and wholesalers then give a quote and send a certain number of samples. The labels will be checked, the price will be considered, and, for a number of beers, they will be tested blind. Our simulation was related to a call for German Kristallweisse, and, as two of the six samples were unfiltered, the test in not flavour alone, several senses come into play.

The tastings take place in laboratory conditions, and the tasting teams spend a lot of time calibrating themselves, trying to avoid personal preferences and arriving at a common standard of quality that is appropriate for the beer in question.

Tasting at Systembolaget

This is serious business. We are talking about the biggest retail chain in the world in this sector, if I’m not completely mistaken. And while there might be various views from the suppliers on how the system might be tweaked to be better and more fair, there does not seem to ba any loud voices asking for major reforms. Sure, there are discussions on how to allow farms to sell their beer and wine, and small-scale brewers might  want better access to shops in their area than the present system that guarantees them shelf space in the three shops closest to the brewery.

Is there a conclusion to this?

If you want to give the public good access to a splendid range of quality products at affordable prices, this makes sense. Sure, I love Ølbutikken, Johnny’s Off Licence and all the other speciality shops across Europe. But that is for a tiny crowd of aficionados. And a quality system that avoids the worst of the crap makes sense, too.

But I leave this open. I cannot praise a monopoly. But almost….

BTW, the visit to Systembolaget was a part of the annual meeting of the Scandinavian Beer Writers Association. A great bunch.

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