* 700 brewers had opened by 1934. A third of them went out of business before WWII. * After the war consolidation continued – 6 major brewers accounted for all domestic supply. * Several hundred imported brands accounted for only 4% of domestic consumption. Coors was quite successful through the mid-1970s. What was its strategy historically? * Geographic focus, low-cost production, differentiated product, and market power over their distribution. By managing these, Coors achieved 21.2% market share, with the lowest amount spent on advertising.
* Low cost of $29 per barrel however they could charge a premium over most of its competitors. Highest profit margins, nearly twice that of their nearest competitor. * Single production facility in Colorado served 11 western states stretching from California to Texas. Shipping costs were twice the industry’s average shipping costs. Made up by the scale of their plant. * Differentiation – pure Rocky Mountain Spring water, expensive raw materials, natural fermentation 70 days of aging versus 20 days
* Country’s largest brewery, single product focus, industry’s fastest packaging line * Coors managed their distribution channel very closely. Distributors had very little power negotiating with Coors. How did Coors’ performance change relative to its competitors in the period from 1977 to 1985? Why? * Coors lost their cost advantage they had prior to 1977, increased sales volume by much less as compared to the industry, and dramatically increased advertisements not focused on maintaining the pure Rocky mountain image * Higher number of products produced at the same facility , rising shipping costs were absorbed by Coors as median shipping distances almost doubled in 1985 * Advertising cost for Coors skyrocketed during the period, 14M to 165M
The Business plan on Industry Analysis – Shipping Industry
Approximately 95% of India’s international trade by volume and 70% by value are seaborne. India has 11 major ports, 19 Medium port, and 187 minor ports along 7,517 km long Indian coastline. It is strategically located as a major maritime nation due to its long coastline that flanks important global shipping routes. The National Transport Policy Committee (1980) recommended the following ...
* Coors management spoilt company image, poor reputation with minorities, union issues Should Coors build a brewery in Virginia? Will it be able to improve it position significantly? * Current factory had 25-30 million barrel capacity, increased shipping distances were adding to the variable cost, so thinking of adding another plant? * No strong evidence that Coors will need a 25 million barrel capacity * Cost savings in shipping would be offset in capital cost to build and maintain new factory * New factory will have a negative impression on the Coors brand What, if anything, might Coors have done differently earlier on?
* Divest some of the vertical integration that Coors had undertaken. * Continue to dominate the western region. Coors could have rapidly expanded capacity to meet the region’s demand signaling that the West belongs to Coors. * New brands eroded Coors Banquet’s differentiating position, especially with growth in super-premium and ultra-premium segments. They should have just kept the Banquet and the Coors Light brands so two instead of going into multiple segments. * They could have done more to bolster their Rocky mountain image. Maintain the brand image rather than trying to get into new markets.
