Breckenridge Brewery Introduction In 1990, Richard Squire opened Breckenridge Brewpub in Breckenridge, Colorado, the first of many he would found. This small establishment, across the street from the popular Breckenridge Ski Area, was able to make 3, 000 barrels of beer per year and served the purpose of keeping him and his friends able to live the dream of being able to ski all day, and drink good beer all night. Soon, however, demand outgrew the abilities of the owner and small staff, making expansion necessary. Squire opened his second pub in an old warehouse that he purchased in a rundown neighborhood in Denver. By 1998, that rundown neighborhood had been renovated and become Denver’s new hotspot, helping boost sales for the Breckenridge company.
During the mid 1990’s, the Brewpub industry took off, and Breckenridge expanded its operations across the United States to cities such as Buffalo, Birmingham, Tucson, Memphis, and Omaha. Between 1995 and 1997 alone, the company was able to open six new brewpubs and expand its wholesale beer distribution to over 30 states. Currently, however, the company only has full service brewpubs in Breckenridge, Colorado, and in Denver, Colorado and sells its products in 13 other states. Products The goal of a microbrewery is to make beer from the purest ingredients and maintain quality and freshness without pasteurization. Breckenridge Brewery accomplishes this by employing brewmaster to create and craft each of its own original recipe specialty beers. Todd Usr, a graduate of the famous Siebel Institute, was at the helm of the beer creation for the company in the 1990’s.
The Term Paper on How CSR is your company
What is Corporate Social Responsibility? Corporate Social Responsibility (CSR) is a self-regulated system that companies use to ensure that their operations are in line with ethical standards, the law and the norms of society. CSR aids companies in taking responsibility for their actions and “encourage a positive impact through its activities on the environment, consumers, employees, communities, ...
He was responsible for recipes, such as their signature beer Avalanche that won the company several distinguishing awards. He was also involved in the creation of their other lines of beer. Breckenridge currently makes the Avalanche Amber Ale, Autumn Ale, Pale Ale, Christmas Ale, Oatmeal Stout, Pandora’s Bock, Summer Bright Ale, and their newest creation, Here Proper. In addition to these, they also make seasonal beer flavors that change from year to year.
Each of these items is sold at one of the brewpubs or is distributed in six-packs of cans, twelve packs of 12 ounce bottles, or by keg or draft. Background In 1998, Kyle Craig was appointed the new CEO of Breckenridge Holding Company (the parent company of Breckenridge Brewery).
He immediately began reviewing the company’s financial data and related industry data. He found that from 1994 to 1995, craft beer sales industry wide had grown 51%, but by 1996, that growth figure had dropped to 26% and by the end of 1997, growth for the industry was only 3. 3%. The large mass-production breweries such as Anheuser-Busch, Miller, and Coors controlled over 90% of the American beer market at the time, and Craig wondered how he would regain market share.
He turned to his key management staff for help. In the last three years, Breckenridge had expanded quickly into new markets. Craig wasn’t so sure that this was a wise decision on the company’s part. Had they expanded too quickly? Did they spread themselves too thin when they expanded across the United States? He felt that these were questions that needed to be answered if Breckenridge Brewery was going to move forward and be profitable.
In order to help answer these questions and others, Craig examined data to see if they were targeting the right consumers and were in the right markets for their beers. He found that a 1996 survey discovered that 18. 9% of consumers with incomes of $50, 000 plus ordered more craft beer than in 1994. He also found that consumers in the Generation X group, or those between the ages of 21 and 34 were more likely to purchase a handcrafted beer than those over the age of 55.
The Business plan on Home Depot Company Market Industry
Introduction History The Home Depot was founded in 1978 by Bernard Marcus, Arthur Blank, and Ronald Brill. These men founded The Home Depot because they were laid-off of their management jobs at the Handy Dan home center chain. They used the knowledge that they acquired from the Handy Dan along with funds provided by a New York venture capitalists firm to form The Home Depot. The Home Depot ...
Based on this information and other sources, he identified the Breckenridge target market as individuals who were upper-middle class, well-educated, interested in outdoor recreation, and between the ages of 24 and 45. Craig next looked at consumption patterns of Americans to determine whether or not they were opening brewpubs and distributing in the right regions. He found that the West South Central region and the Mountain region had the highest annual per capita consumption rates (see chart below).
With all of this information, he set forth to find a way to turn the Breckenridge business around and make each individual unit profitable. The Value Chain According to the textbook the value chain analysis is the building blocks of competitive advantage.
Breckenridge Brewery has many challenges throughout its value chain. It all started with the tidal wave of growth in the craft brewing industry. According to industry information from 1992 to 1996 companies were showing between 25%-75% growth per year. However, there was no growth in 1998. The company was driven primarily by opportunistic real state deals and executed without a comprehensive plan. The brew-pubs suffered from a lack of consistency, poor communication and inefficiency.
They did have an experienced workforce because most of the employees had been there since the beginning. One of their strengths was the freshness of their beer, because they used pure ingredients. The downside to this was that its life span had to be monitored and rotated it was also costing the company 50, 000 per representative to carry out this task. The beer also had to be shipped-out in refrigerated trucks, which was costly. Breckenridge beer was distributed in about 30 states, but the Colorado market generated over 50% of the total sales. There was not sufficient information to build a chart for the value chain activities using overall cost leadership or examples of differentiation because they simply did not list them in the article.
The Research paper on Breckenridge Brewery Company Beer Business
... it can be used to create an exclusive market position. Strengths of Breckenridge Brewery The company has a visionary leader in Richard Squire ... off if they exit the brewpub business and concentrate on what they do best; which is brewing beer. As there is still spare ... to whether to continue the brewpub business or to give it up and just concentrate just on brewing beer. He is also unsure ...
Since the end of the time period of this case, which was 1998, Breckenridge has undergone several changes. There has been a considerable amount of consolidation in their business scope. Since Breckenridge Holding Company is not publicly traded, current financial information could not be attained. All of the Breckenridge brewpubs outside of Colorado have since closed down, and Breckenridge has scaled down the distribution of its beer from as many as 28 states in 1998 to 14 states now, including Colorado. This downsizing in the distribution was in response to stagnant growth in the craft beer industry and poor beer sales from its brewpubs and its retail distributors.
In 1997 the growth rate for the industry was 3. 3%, off its high of 51% just two years before. In 2002, the industry continues to maintain a 3. 4% growth rate.
There are currently four brewpubs either partially or entirely owned by Breckenridge. The original brewpub in Breckenridge is still operating along with the Blake Street brewpub across from Coors Field, the Klamath Street brewpub, which is also the site of its largest brewery, and more recently Breckenridge opened a brewpub in Parker, Colorado. These Colorado sites have always been the most successful for Breckenridge, and therefore the survivors of the sluggish growth in the craft beer industry. A large part of their success had to do with the ski / mountain theme that the brewpubs held.
The brewpub locations that have been closed since 1998 include Buffalo, Birmingham, Memphis, Omaha, and Tucson. Breckenridge has downsized its operations to focus of their core market, primarily in the Colorado area. There are a number of financial ratios that can be performed on a company to see how it is doing both short term and long term. The current ratio is a short-term indicator of the company’s ability to pay its short-term liabilities from short-term assets. This is done by dividing current assets by current liabilities. This figure should always be above one, or the company does not have enough assets to meet its liabilities.
Breckenridge Brewpub’s current ratio for 1998 was 1. 76 and in 1997 it was 1. 32. This shows that the company is able to pay its short-term liabilities with its short-term assets. Another ratio that was done on Breckenridge Brewpub was an acid test. This measures the company’s ability to pay off its short-term obligations from current assets, excluding inventory.
The Term Paper on What Is Meant by Market Failure
Why do some markets fail? Market failure is said to occur when the price mechanism is unable to allocate resources efficiently. Meaning that the forces of supply and demand lead to a net welfare loss in society, that the resources were not used to their maximum capacity. When there is market failure it is down to the government to correct them. Here are five way in which the market can fail • ...
This number should also be above one for a company to feel comfortable. In 1998 the ratio was at 2. 24 and in 1997 it was at 1. 54. This shows that the company should not have any problems meeting their debt obligations. The last financial ratio that was done on Breckenridge Brewpub was a debt to asset ratio.
This measures the extent to which borrowed funds have been used to finance the company’s assets. In 1998 the debt to asset ratio was. 294 and in 1997 it was. 284. This number should stay below a. 40.
The higher the number the more risk that is involved in the company. Competitive Strategy In order to better track results, we plan to separate the operations of the brewery and the brewpubs. This will ensure that the brewpubs are not masked by the profits of the brewery. We also plan to increase our product line to keep up with the ever changing tastes of our target market. This will increase our market share in the microbrewery industry and give our customers a more customized beer that can not be imitated by the mass beer companies. Another strategy we feel will be beneficial to the company is to create a more uniform theme and menus in the brewpubs.
Our target market enjoys travel and it would be to our best interest to create a common ground for brewpubs throughout the United States. In order to achieve this uniformity, the service received at the brewpubs must be up to par for our affluent market. To achieve this, an intense training program will be implemented to give the best service and keep the customer coming back. Conclusion Our market share in the craft beer industry can be saved and increase if the strategies mentioned are implemented in an effective manner. We are very optimistic that the beer consumption market will continue to grow and we want our stake in the growth.
Additional Charts (Value chain, EFAS, IFAS, SWOT, SFAS, TOWS, etc. ) Top 25 Specialty Brewers in the U. S. (2001) 1 Boston Beer Co.
, MA 14 Portland Brewing Co. , OR 2 Sierra Nevada Brewing Co. , CA 15 Harpoon Brewery, MA 3 Jacob Leinenkugel Brewing Co. , WI 16 Snyder International, OH 4 Spoetzl Brewing Co. , TX 17 Gordon Biers ch Production Brewery, CA 5 FX Matt Brewing Co. , NY 18 Full Sail Brewing Co, OR 6 New Belgium Brewing Co.
The Term Paper on Skin Care Market Product Products
L'Oreal Introduction L'Oreal is the largest cosmetics company in the world. It shouldn't be a surprise that L'Oreal doesn't sell all of its product lines in every market in which it sells, and the market in the Netherlands is no exception. Upper management of the Netherlands' L'Oreal subsidiary have to make decisions on which product lines will succeed in their respective market and which ones ...
, CO 19 Mendocino Brewing Co. , CA 7 Red hook Ale Brewery, WA 20 Boulevard Brewing Co. , CA 8 Pete’s Brewing Co. , TX 21 Summit Brewing Co. , MN 9 Widmer Brothers Brewing Co. , OR 22 Long Trail Brewing Co.
, VT 10 Pyramid Breweries Inc. , WA 23 Goose Island Beer Co. , IL 11 Deschutes Brewery, OR 24 Rock Bottom Restaurants, CO 12 Anchor Brewing Co. , CA 25 BridgePort Brewing Co. , OR 13 Alaskan Brewing & Bottling Co. , AK The Value Chain o Experienced workforce.
o Focus was on freshness. o Microbrewery used pure ingredients. o Capacity always an issue. o Successful beer recipes.
o Brewpubs lacked consistency o Beer had to be shipped in refrigerated trucks. o Transport at-ion was very expensive. o Its target market were 24-45 year olds. o Well educated. o outdoor recreation o Poor service in brew-pubs o Location, location, location of Brew-pubs was important. o Beer side was doing excellent.
The Value Chain Support Activities o Employees motivated to work for a common goal. o Microbrewery used pure ingredients. o Richard creativity, vision and energy were key factors in company growth. o Driven by opportunity real state deals. o Planning was a major issue. o In 1996 its state of the art facility allowed it to more that double its production SWOT Strengths – Expand product line – Increase distribution – Marketing potential Threats – Competition – Current market and industry conditions – Federal and State legislation Opportunities – Expand product line – Increase distribution – Marketing potential Threats – Competition – Current market and industry conditions – Federal and State legislation IFAS Internal Strategies Weight Rating Weighted Comments Score Factors Opportunities New markets 0.
2 5 1 Infinite # of markets New products 0. 2 4 0. 8 Small batches = experimentation Weak competition 0. 1 4 0. 4 Not many brewpubs High demand 0. 2 5 1 We love beer Threats Mass beer producers 0.
1 2 0. 2 Tough to take marketshare State laws 0. 1 3 0. 3 Some are very restrictive Import beer 0. 1 2 0. 2 We like foreign things Total 3.
The Term Paper on Tv And Advertising Product Market
The Television Industry and Advertising After a long day's work or a hard day at the office, people come home, sit in the Laz-e-Boy recliner, and flip on the television. Watching a favorite TV show has become many people's favorite way to relax or past the time. A wide variety of programming exists and most anyone will be able to watch something they can enjoy. The television industry is part of ...
9 EFAS Internal Strategies Weight Rating Weighted Comments Score Factors Strengths Brewmaster 0. 2 5 1 Trained at Siebel Institute in Chicago Product lines 0. 15 4 0. 6 Beer and resturant match the region Communication 0.
1 3 0. 3 Very open from top to bottom Image 0. 1 4 0. 4 Rocky Mountain Brewery Real estate 0.
05 3 0. 15 Coors Field Colorado Rockies Weaknesses Logistics 0. 1 2 0. 2 Refrigerated shipping Freshness 0. 1 3 0.
3 Must be rotated Inefficiency 0. 1 1 0. 1 Tough to give up on an idea Lack of consistency 0. 1 1 0. 1 None are the same Total 3.
15 SFAS Duration Key Strategic Factors Weight Rating Weighted Score Short Medium Long Comments Brewmaster 0. 1 5 0. 5 x the best in the industry Product lines 0. 1 4 0. 4 x easy to create new beer Logistics 0.
1 3 0. 3 x train and create better methods Freshness 0. 1 3 0. 3 x better training New markets 0.
1 2 0. 2 x plenty of niches Weak craft competition 0. 1 4 0. 4 x no clear dominant competition High demand 0. 2 5 1 x gives us beer Mass beer producers 0. 1 3 0.
3 x no taste Import beer 0. 1 3 0. 3 x false images 1 3. 7 Tows IFAS Strengths (S) Weaknesses (W) Brewmaster Logistics EFAS Product lines Freshness Communication Inefficiency Image Lack of consistency Opportunities (O) find a product that would make the inconsistency New markets be unique to a new market a part of the image New products Weak competition exploit differentiation b / w create products with less High demand competition maintenance or care Threats (T) Mass beer producers exploit craft beer crate better logistics and State laws advantages procurement Import beer research statutes to create differentiate more efficiency.
