Porter 's Five Forces Industry Competition

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Porter’s Five Forces Industry Competition / Intensity of Rivalry: As with every industry and business, there is competition. In the case of the craft beer industry, the competition is medium and growing. From challenging the big macro-breweries, to battling against new incoming brewery businesses, the craft beer industry is absolutely on the radar for competition. Macro-breweries are still the largest competitors with craft breweries. The major player in the craft beer industry, according to IBISWorld, is The Boston Beer Company. It holds a market share in the overall beer industry of only 2.7%, and a revenue of $885.5 million in 2014. In comparison to the major players in the overall beer industry, Anheuser-Busch InBev and MillerCoors…show more content…
If consumers prefer a specific beer and keep asking for it at bars, which only have a specific amount of taps, will put that beer on more often to suit the increased demand. This makes the beer and the brewery more popular, all the while intensifying the rivalry for bar space. Suppliers: The suppliers for craft beer include the source of the ingredients and the source of the materials used in production. The craft beer industry relies on responsible, dependable, fresh supplies from different industries to make production and distribution possible. The suppliers for production include various industries for the basic ingredients; wheat, barley, soybean, corn, yeast, malt, nuts, sugar and water. Other suppliers for distribution include the packaging industry, which consists of aluminum, glass, cardboard, and containers. Smaller companies face a financial barrier here when attempting to make flavorful beers that require high priced raw materials. The lofty prices of high quality ingredients often act as a barrier to newcomers seeking to establish a niche in the market. Lastly, the printing industry also plays a role as a supplier by printing labels. Due to the uniqueness craft brewing methods, not all batches turn out the same, so the industry may have to charge higher prices based on the cost of production. Since each craft beer style has a unique measuring and brewing method, there is a large variety
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