Organizational Behavior 364 Assignment 1

A price estimate of a 6-pack of bottle Coors beer today is $5.59, and using the Consumer Price Index for 1990 it was determined that a 6-pack of bottle Coors cost approximately $3.43 (see Appendix A-2). Using Study F Cost of Goods Sold is 77.1% of sales. The contribution margin was then calculated as 22.9%. Fixed costs summed up to be about $250,000 including salaries, equipment & land depreciation, utilities, insurance, taxes, maintenance and janitorial services, and other miscellaneous expenses. Break-even Sales computed from the aforementioned figures turns out to be $1,211,790.39 (see Appendix A-4). Variable Costs per unit were determined using the contribution margin and price variables, and the result came to $2.65 (see Appendix A-4). Break-even quantity then was calculated at around 320,513 units, or gallons in 1990 (see Appendix A-5). A 6-pack of bottle beers holds approximately 72 fluid ounces, this makes up about 0.5625 gallons resulting in a price of roughly $5.35 per gallon (see Appendix A-6). Projected demand of beer in 1990 in South Delaware is about 5,400,397 (see Appendix A-1) and the Coors estimated market share of this demand according to Study C is 8.9% which computes to 480,635 gallons, therefore projected sales of Coors in the 2 county South Delaware distribution area is around $2,573,404.10 in 1990 (see Appendix A-7). The break-even market share of Coors in the 2 county distribution area of

The next project was bottling Gordon Biersch signature beer and retailing it. This had three biggest challenges: this project was entirely Gordon’s baby and demanded time and attention; secondly the freshness of the bottled beer versus the freshly brewed was an issue for which they decided the beer would have a shelf life no longer than three months. Thirdly and the most exciting challenge was the head-to-head competition with other microbreweries and premium beers. Despite the tough competitive environment, Gordon Biersch aimed to achieve 11% of the market in three years (by 1996). This retail venture required huge investment, thus they decided to start small to prove to the investors that they could pull it off.

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).

This had an adverse affect on the Amsterdam Brewery and other stakeholders too because it had failed to translate into increased sales of the product offsite. The owner got confused to make decision that whether he should continue to focus on building the original products or should keep releasing and promoting new products.

Larry Brownlow, a young entrepreneur, wanted to operate his own business after completing graduate school. He agreed to a distributorship opportunity with Coors. The brewery company was looking at expanding their market potential of a Coors beer distributorship to a two-county area in southern Delaware. Brownlow used his resources to find and contact Manson and Associates, a research company,

New Belgium brewery has increasingly grew throughout the years since their development in 1991. Despite the dominance of the “Big Three” (Budweiser, Miller, and Coors), NBB needs to be aggressive and strive to invest in the attractive beer industry in able to grow more. If positioned correctly, NBB and its main brand, Fat Tire, can continually grow. An evaluation of the industry, the business itself, its brands, and the customers and competitors is needed in order to be continuously successful.

Meanwhile, since Grolsch used other brewers for distribution while importing beer into foreign countries, the ongoing industry consolidation often led to a need for changing distributors. In several of their markets Grolsch was already on its third or fourth distributor in the span of 15 years. Besides the political, economic, and logistical issues Grolsch had to adapt to, they also were adapting to cultural differences. Their marketing campaigns would vary significantly from market-to-market. While their ability to be nimble, change strategies, and adapt where necessary has been a benefit, it has also been limiting in that Grolsch has struggled to build a consistent brand image and market position in several of its key markets. For example, even though the UK accounted for 25% of Grolsch’s volume, they still only held 1.5% of the UK market. Further, operations have been impacted by the consistent turnover of distributors in several important markets. Grolsch’s adaptation strategy has kept them nimble but has prevented any large scale and stability in certain countries outside the Netherlands.

Organizational Behavior has taught me a lot in regards to learning to work with others and making groups of people work efficiently. While classroom readings and in-class slideshows have been valuable in understanding key concepts, my greatest personal growth has come from both your personal stories, as well as your many invaluable speakers. Throughout this paper, I will focus on the lessons your speakers have taught me, and how those shared lessons will have a positive impact on my future decision-making.

Boston Beer Company (BBC) has enjoyed much success with their craft beers with Samuel Adams as their main focus. Being the leader of this segment, overtopping five of their competitors combined (Exhibit 1), the company now must decide how to take advantage of the light beer market. Boston Lightship, their current light beer, had been a small contributor in BBC’s product line. Currently, it is facing dwindling sales with product volumes down from 12 000 cases per month to 3000 cases per month.

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

Even though their shipping costs were twice the industry’s, average shipping costs would have been much more had they attempted to enter other states. Besides, Coors made up for the inefficiency with the scale of their plant, the largest in the nation. The location lent itself well to Coors’ ability to differentiate its product. For example Coors was brewed using “pure Rocky Mountain spring water.” Coors had a great opportunity to serve an underserved geographical market. Seven of 24 million barrels sold in the region had to be imported from production facilities outside of the region, and Coors’ Colorado facility was more central to the area than the three other closest facilities in Missouri, Texas, and Wisconsin. Coors had the second lowest production cost per barrel in the industry, in spite of their claim of the most expensive raw material costs. Their cost advantage stemmed from the industry’s highest capacity utilization, economies of scale through the country’s largest brewery, single product focus, and the industry’s fastest packaging lines. Matching their low production cost was the lowest advertising cost relative to the industry. The mystique that had been built up about Coors and their differentiating, all-natural appeal allowed them to get away with lower advertising costs than average for the industry. Coors differentiated their product, both in the

Classical organization theory evolved during the first half of this century. It represents the merger of scientific management, bureaucratic theory, and administrative theory.

Hirotaro Higuchi (the protagonist), and CEO of Asahi Breweries, Ltd. must decide if he should increase its production and packaging capacity to meet the supply demands of their distributors, due to the company’s recent developments in the beer industry. Asahi Breweries has launched and seized a huge section of the dry beer market, ensuing from sales growth of 71.9% in comparison to the industry’s growth of 7.6%. A proposal has been made for, increasing their production capacity to 2,100,000 kiloliters to accommodate the recent shortages to their distributors. He has suggested an investment proposal plan of 230 billion yen within two years (1989 to 1990), to increase their brewing and packaging capacity by 30%. Hirotaro Higuchi must decide if he will welcome or dismiss this proposal. “Guiding change may be the ultimate test of a leader- no business survives over the long term if it can’t reinvent itself” (Kotter, 2007).

I’m an undergraduate student majoring in economy prepared the marketing plan for the purpose of learning and experience.

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).