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The brewing industry makes a drink known from the most ancient of times. Through advances in time and technology the brewing industry has changed essentially into one of the largest modern multinational industries that exist today. It was not until the early nineteen hundreds that the beer industry initialized through the creation of lager beers. The technological advances created at the same time were, Mechanical refrigeration greatly aided in the production as well as the storage of beer. Pasteurization was also adopted during this period, which opened the way for wide-scale bottling and off-premise consumption of beer. In addition, developments in transportation allowed brewers to ship beer long distances in refrigerated rail cars, increasing both marketing volume and area (Goldhammer, 1).
The beer industry has remained generally stable in our economy since the prohibition era. A strong economy, diversity, and foreign trade rates are several factors that maintain the success and growth of such a mature product. The brewing industry is part of the second largest industry in the nation. Beer has given the definition of alcohol seeing that, The alcoholic beverages industry is a $ 95 billion dollar a year business in the United States beer held a 57 % market share against other alcohols (web). The industry requires a continuous update in knowledge of the history and current standings of the beer market, market trends, and competition that exist throughout. The market perspective of the brewing industry is incredible.
The wholesale volume in the beer industry approximated $ 13. 7 billion. In domestic brands, from 1983 to 1984 there has been a decline in consumption of - 1. 2 %. In the imported section there has been an increase of 14. 3 %. The total industry as a whole declined. 7 % from 1983 to 1984. As a result of the decline in consumption of beer a similar result in production occurred with a decline of 1. 2 %. The estimated forecast for 1985 will continue along the same trend as did 1984.
The long term outlook for the industry is that sales will remain flat for the next 10 to 20 years. (Goldhammer 1 - 7). Yet, through the development and market of light beer and targeted market segments, the last five years have shown an increase in market awareness and revenue. Within the last several months, the industry has not had the continual success as recent years. As the second year of the new millennium comes to a close, the United States brewing industry likely will see a pause in their recent growth trend.
After five consecutive years of growth, shipments from brewers and importers to their beer wholesalers are expected to hold near 2000 's record level of 197. 6 million barrels. This pause is primarily due to the national economic slowdown and the aftereffects of the September 11 attacks (web). A strong economy represents an important contribution for the beer industry because the fall of the economy an increase in sales are not going to happen unless the economy is in strong, stable conditions. The development of the industries annual production has created a profile of three levels in terms of high-volume, regional, and small breweries and is organized into a so-called three-tier distribution system: 1) brewers and importers, 2) wholesalers, 3) retailers. (Goldhammer 1). The beer industry is segmented among the three market coverage types; federal, state, and local. Because each state obtains different laws, beer is regulated in 50 different ways in the United States.
The brewing industry is subject to extensive government regulations at both the federal and state levels and sometimes at the local level as well, concerning distribution, labeling, advertising, credit, container characteristics, alcohol content, tax rates, and litter assessments (Goldhammer, 1). Large capital requirements and distribution networks make it hard to enter the national market. Even if stable, each state requires a different set of laws and regulations pertained to the industry, making the governmental aspect very difficult. Although the market is one that is both difficult and competitive, it appeals to a large consumer demand. On the national marketing front, makers and sellers of beer are paying more attention to the increasingly diverse drinking population, the groundswell of first-time legal-age drinkers, and the nations overwhelming preference for light beer (Estes 1). The US Census Bureau predicted that 3. 76 million consumers will turn 21 next year; therefore 3. 76 million more consumers will be of market value to the industry.
The industry is also focusing on areas of diversification for market segmentation. The customer segments that exist are of several. Taylor of Coors stated, The American consumer is certainly becoming more diverse, many mediums are available to reach diverse or specific markets. The fact that were in an overall flat industry makes it important for any beer maker to look at places where they can bolster sales (web). An example of diversity among consumers is the fact that more consumers are changing to imported or specialty beers; although the largest new segment that exists currently is the transition to light beer due to a more health conscious economy. In terms of demographics the beer market consists of mostly males, with a newer focus on women and other cultures.
Beer consumption is overwhelmingly male-dominated, with men accounting for more than 80 % of the volume consumed. A large number of these beer drinkers are white and favor domestic light beer, followed by domestic draft beer. African American drinkers make up about 10 % of the beer market overall, and they are the biggest consumers of malt liquors... of all the beer types, light beer has the strongest following among women consumers. Women beer drinkers are more attracted to specialty micro-brewed beers than they are to big brands (web). The pricing of beers is also determined based on the target market of the particular product.
Value-priced beers are intended to capture certain demographic groups based on income and age. While premium beers serve the upper echelon of the market (US Business Reports, 5). The competitive rivalry is broken up into three segments, National, Regional, and Microbrewers. National competitors have wide market coverage and generally a large company. National competitors have wide market coverage and generally a large company. Regional competitors are smaller than National in the fact that they only distribute in certain regions.
Microbrewers are the smallest of the three because their size and capacity limit them to only distribute to small geographic areas. The rivalry among existing competitors is strong. Demand for the product is slowing. In order for a company to increase market share, another company has to lose it. Switching costs are low for consumers. Because switching costs are low, Competition is very intense to gain new market share.
The beer industry is a cut throat business with extreme competition. There are many companies that exist within the industry. Through the years the industry has slimmed down quite a bit. The National market consists of ten major competitors. The Competitors in this market are Anheuser-Busch, Miller, Stroh, G.
Heileman, Adolph's Coors, Pabst, Genesee, C. Schmidt, Falstaff, and Pittsburgh. The National companies have 51 plant locations across the United States. Market share in the Domestic market ranges from a low of. 5 % to a high of 34 %. The Import market consists mainly of ten major brands also. They are Heineken (Netherlands), Molson (Canada), Beck's (Germany), Moosehead (Canada), Labatt (Canada), St.
Pauli Girl (Germany), Dos Equis (Mexico), Foster's Lager (Australia), Amstel Light (Netherlands), and Corona (Mexico). These ten brands hold about 87 % of the imported market share. The individual companies range in market share from 34 % on down. A few regional companies, and many small microbrewer's make up the rest of the companies in the industry. The brewing industry consists of many different issues facing a variety of markets. Through current trends and issues, market segmentation, and competition analysis, the beer industry can be understood.
Yet, to maintain a high standing position within all aspects is of great difficulty. The company of Coors Brewing is one that has obtained a strong position within the industry, maintaining third in the country for sales. Coors The Adolph Coors Company is a company that particularly stands out in the brewing industry. With almost two hundred and thirty years of business, the Coors Brewing Company is the nations third largest brewer. Obtaining the Coors Golden Brewery, which is the largest single site brewery in the world, Coors produces, markets, and sells high-quality malt-based alcoholic beverages.
Coors concentrates on distinctive premium and above-premium brands that provide higher-than-average margins (US Business Reports). The time and experience have led Coors to produce a desired product for a marketable consumer. Coors currently has 18 brands in its portfolio, of which five are premium products Coors also owns and operates The Sandlot Brewery at Coors Field ballpark in Denver, Colorado. (US Business Reports). Coors has shown a great overall success within the industry, yet as with any company, where strengths and opportunities exist, weaknesses and threats follow. Involvement with the community is a beneficial strength that Coors prides itself on. Because alcoholic consumption can lead too many negative results, and is an illegal beverage if consumed before the age of twenty-one, the programs and policies it supports are crucial in terms of social responsibility.
Coors has a statement pertaining to its responsibility, At Coors Brewing Company, we measure our success not only in terms of our financial performance, but also in terms of our social performance. Being a good neighbor is a company tradition. In fa...
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Research essay sample on Company Analysis Of Coors Brewing
