Craft Beer

During the past 30 years, Big Rock has provided beer drinkers across the country with a high-quality product line consisting of reputable brands such as Traditional and Grasshopper Ale. Moreover, due to the continuous change in craft beer drinkers, Big Rock has provided a diverse variety of flavours to compete in the craft market segment primarily in Alberta. However, as the industry becomes increasingly more competitive due to the exponential growth of microbreweries, Big Rock must continue to develop its brand and spread awareness beyond Alberta and across the country in order to address the stagnated growth that currently exists within the business.

     In this paper I will be talking about the U.S. beer industry and in short an overview of the brewing industry worldwide. I will talk about the barriers to entry, economies of scale, government intervention, pricing, current market trends, product differentiation, and imports. The focus being mainly on the U.S. brewing industry oligopoly. The U.S. brewing industry has three major players: Anheuser-Busch, SAB Miller, and Coors/Molson. Anheuser-Busch is currently the largest brewer in the world, producing over 100 million barrels a year. Anheuser-Busch currently owns over 50% of the market in the United States, with Miller trailing behind at 20% and Coors at about 11% with the rest of the market occupied by imports and craft breweries. When analyzing any industry, how easy it is for newcomers to enter the market is a great importance. If there are high barriers to entry

In a world where large, corporate breweries rule the market, craft beer is created to please an audience that applauds the styles, techniques and flavors. Though craft beer can be purchased through several different outlets, the best place to thoroughly enjoy the entire experience of the specially made beer is in the brewery where it was made. The article titled, “In Lean Times, a Stout Dream” in The Wall Street Journal1 states that, despite the hard economic times and consequent consumer cutbacks, sales of craft beer, the industry 's fastest-growing segment, rose

Strives to be the leader in micro brewing while maintaining the core values it started with and had employee buy in even before it went” 100 % employee owned in2013” (Gorski, 2013).

So what makes one beer more interesting than another? It begins with the brewer, choosing ingredients, mixing flavors, and making subtle changes.

New Belgium is, however, the third-largest craft brewery in the nation, with estimated sales of over $100 million, equaling approximately 700,000 barrels of beer per year. An analysis of the craft beer industry as a whole suggests that there is continued growth potential for New Belgium. Exhibit 5.1 of the New Belgium Brewing (B) case shows that craft beer is the fastest growing segment of the U.S. alcoholic beverage market, with an increase in market share of over 100 percent from 1999-2011. It is also an industry whose customers tend to be extremely loyal, making them less likely to view craft beer as a commodity. Consequently, craft beer has a higher probability of being immune to competition from inferior goods and substitutes. This is particularly applicable to New Belgium’s target market of “beer connoisseurs” that appreciate the high quality and taste of craft beer and who include “executives, lawyers, and accountants” with the continued ability to pay higher prices for craft beer, enabling the craft beer industry to achieve gross margins of up to 30 percent (Clark & Rogler, 2013).

The Boston Beer Company, Inc., founded in 1984, is a leading brewer in United States, offering wide variety of high quality full-flavored, handcraftedbeers. It is distinctive due to the time-honored recipe of brewing and authentic, consistent quality of alcoholic beverages. Samuel Adams Boston Lager is the pride of BBC, regular handcrafted beer “stands for quality, inner self-worth, authenticity, and unique New England or Yankee toughness” ( Martin Roper, Chief Operating Officer). Unfortunately, the company experienced the failure of conquering light beer segment

(6) Briefly summarize your opinion on the short-term and long-term current outlook for America’s brewing industry, especially with respect to its international

The craft beer story is interesting because of how quickly the craft beer trend has caught on in the food service industry. The story would focus on how bars, restaurants, and grocery stores are adapting to the increased demand of craft beers. The first source for the story would be Frederique Boudouani who is the owner of Abu Nawas Beverage Company. The Abu Nawas Beverage Company is a craft beer wholesaler and sells beer from countries across the globe. The second source of the story would be the owner of Drew’s Sports Bar and Grille in Elkader, Andrew Armstrong. Armstrong would provide valuable information on how craft beer sells in small towns and insight into how bar owners decide what beverages to sell. The third source would be Zachary Ingles who works as a night manager at John’s Grocery in Iowa City. John’s Grocery has a wide selection of craft beer and Ingles regularly attends beer tasting events to help John’s decide which beer to stock. The fourth source would be an employee at an actual craft beer brewing company, Neil Blair. Blair would provide insight into how craft brewing companies operate and how the companies go about selling their

Investors for Craft Brewery Start Ups _______________________________________________ 24 Craft Beer in a Tin initiative:_______________________________________________________ 25 Corporate Social Responsibility ____________________________________________________ 26 Economics of Beer: _______________________________________________________________ 28 Building a Craft beer brand: _______________________________________________________ 29

The brewing industry can be characterized by Porter’s Five Forces framework. New entries to brewing have a relative ease in creating home micro-breweries, which is aided by

New Belgium Brewing’s original marketing strategy focused on relational marketing using a “barstool to barstool” method of marketing and creating “brand stewards” in a grassroots effort to spread the word about New Belgium’s craft beers. As the company’s brand and leadership strategy matured, the marketing became proactive and focused by creating bicycle events, interesting take-away merchandise and a touring taste-testing vehicle. By forming personal relationships with their customer base, NBB organically gained market share. To remain competitive in the craft brew market

Beer has a long history. In 2000 B.C.E., Sumerians had prepared eight different beer types, ranging from “strong,” “red brown,” and “good dark” (Mauk, 2013). Breweries have created their own recipes, brewed their own beers—some with alcohol, some without. Over the past few years, craft beer gained steady market share away from the national and international breweries (Murray & O 'Neill, 2012). Separating one beer from the next is the product itself, and what the product has to offer. Competition is ferocious due to more informed, sophisticated consumers, as well as globalization and the spread of technology (Murray & O 'Neill, 2012).

Craft beer should not only be sold as premium beer among graduates and people with income of more than 75000 USD but also to people with moderate income.

Beer Company 2 is a brewer of “seasonal and year-round beers with smaller production volume and higher prices” that “outsources most of its brewing activity” (pg. 120). It is financially conservative, and has undergone a “major cost-savings initiative to counterbalance the recent surge in packaging and freight costs” (pg. 120).