Georgia 's Craft Beer Industry

     The brewing industry was once held to competition among many breweries in small geographic areas. That was almost a century ago. The U.S. brewing industry today is characterized by the dominance of three brewers, which I will talk about in this paper. There are many factors today that make the beer industry an oligopoly. Such factors include various advancements in technology (packaging, shipping and production), takeovers and mergers, economies of scale, barriers to entry, high concentration, and many other factors that I will cover in this paper. Over the course of the paper I will try to define an oligopoly, give a brief history of the brewing industry, and finally to show how the brewing industry today is an

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

In a highly regulated three their system, access to market has grown exponentially more difficult for small brewers in just the last decade. Consolidation within the distribution tier has created far fewer and much larger wholesalers to choose from. It is imperative that the microbrewers know and understand the second tier of the business to ensure their products are adequately marketed and handled.

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).

Different groups in America are classified by the eras that they were born into. The active generations who had the great impact on society today are the Baby Boomers and the Millennials (Debevec, 2013). In between the baby boomers and the millennials are the Eco Boomers and the Gen Xers (Kennedy, 2000). According to population projections released by the U.S. Census Bureau, Baby Boomers are the generation defined by the boom in U.S. births following World War II. They were born in the years between 1946 and 1964 (Brownstein, 2012). On the other hand millennials are the generation born in the years between 1981 and 1997 (Brownstein, 2012). There are 77 million boomers and 82 million millennials (Fallon, 2015). Both generations overlap in time, and are linked in that most of the Millennials are generally the children of the Boomers, but they are actually completely different in economics, education, politics, and lifestyles (Fallon, 2015).

We’re told that craft beer’s share of the market rose 17.6% last year, accounting for 11% of beer volume and $19.6 billion of the beer industry’s $101.5 billion in sales. However, it’s also a market in which the sale of imported beers rose 6.9% in 2014 and where, according to Nielsen, the amount of Mexican beer alone sold in grocery stores within the last year is equal to the amount of all craft beer sold from supermarket and convenience store beer shelves. It’s also a market where, despite advances by both craft and imported beers, one of every five beers sold is a Bud Light. In fact, the 38 million barrels of Bud Light sold last year would not only make it the No. 3 brewer in the U.S. if it split off from Anheuser-Busch InBev BUD, -0.51%

Based on the volume, ."..craft brew segment represented by four types of establishments: microbreweries, brewpubs, regional breweries, and contract breweries." (Madcap 23)

The Coors brewing industry had many ups and downs throughout its history dating back to its start in 1873 (Adolf Coors in the Brewing Industry). There were times of great growth and expansion that would get interrupted by numerous different setbacks. Some were small and some led to extreme changes. It sounds similar to any type of business. However, the different generations of the Coors family seemed to find ways to usually compete with their competitors and maintain the success of the company. It was also very challenging. Different changes had to be made for each new obstacle that came their way. Over a century has gone by since its start in Golden, Colorado, and the business seems to still be available in stores around the world

The Hampton Roads region is no exception to the recent nationwide interest in local breweries and craft beers. Although certain state regulations initially prevented craft breweries from existing to their full capacity in this area, some breweries still began to achieve success. O’Connor Brewing Company made interest in these beers possible in this area because of its immediate success after a long trail of failed brewing companies (“O'Connor Brewing Company” NP). Due to former regulations, most brewing companies closed within months of starting up their businesses. Previously, Virginia law prevented breweries from selling alcohol at its respective establishments, a key part of upkeep for any local brewery (Riggan NP). Although the

Among all the generation, Millennials have become the largest generation in U.S in the last two years. Millennials are also the fastest-growing generation of customers in the marketplace, bringing the greatest lifetime value. In addition, Millennials exhibit different attitudes toward employment, sales, and marketing, which are challenging many conventional strategies and approaches.

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).

Finally, the large brewers were increasingly successful by creating another point of differentiation. They attracted more consumers as the big brewers had the capacity to package beers in different sizes and therefore also appeal to consumers who drank beer in small amounts or slowly as well as packaged in different numbers to cater to the growing population of drinkers who consumed at home.

As of 2013, there were 40,537,995 female millennials (16-34 years-old) in the United States with a median income of $30,000/year. Only 11.6% of the female millennial demographic were unemployed, which indicates strong purchasing power.

The beer industry has been around for centuries and is still growing strong as to date. This report talks about the macro and microenvironment and the 4 P’s of

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