Bluegrass Brewing Company

Only available on StudyMode
  • Download(s) : 14
  • Published : March 14, 2013
Open Document
Text Preview
Bluegrass Brewing Company

MBA 601
Fall 2012

Table of Contents
Introduction………………………………………………………………………..…………1 External Analysis…………………………………………………………………..………..1-5 General Environment……………………………………………………………………….1-3 Industry Environment……….…………………………………………………………..….3-5 Threat of New Entrants……………………………………………………….3-4 Bargaining Power of Buyers………………………………………………….4

Bargaining Power Suppliers………………………………………………….4
Threat of Substitutes…………………………………………………………..5
Intensity of Rivalry among Competitors………….………………………….5 Competitive Environment…….…………………………………………………………...5 Internal Analysis…………………………………………………………………………….5-8
Resources…………………………………………………………...........................6
Capabilities…………………………………………………………………………….6
Value Chain Analysis………………………………………………………………...7-8 Core Competencies…………………………………………………………………..8 SWOT Analysis………………………………………………………………………………8-9 Business Level Strategy………………………………………………………………......10 Recommendation………………………………………………………………..................10 Works Cited………………………………………………………………………………..11-12 Appendix…………………………………………………………………………………...13-14 Introduction

Bluegrass Brewing Company (BBC) is a nationally recognized, American craft beer company, whose mission is to create bold, unique beers, quality affordable food, and serve them both in a warm and comfortable, family friendly atmosphere. Founded in 1993, BBC is Louisville, Kentucky’s oldest micro brewing company, producing just over 2,000 barrels a year. ("Facebook: Bluegrass Brewing, 2012"). Although the company classifies itself as a microbrewery, the Brewers Association would actually classify BBC as a brewpub because they do not sell more than 75% of their beer offsite (Brewers Association, 2012). For the purpose of this paper, we will identify the industry that BBC competes in as the craft beer industry. According to the Brewer’s Association, the craft beer industry is divided into six market segments: microbrewery, brewpub, contract brewing company, regional brewery, regional craft brewery, and a large brewery. Craft beer is currently nearing maturity in the growth product cycle (See Appendix 1). The key players in the industry are Cumberland Brewery, Falls City Beer, New Albanian Brewing, Against the Grain, and Apocalypse Brew Works. External Environment

General Environment: In dissecting the demographic environment, we learned from a conversation with the head of marketing at BBC that their target market is males between the ages 35-55. As of May 2012, Jefferson County had a population of 721,594 people, with the median age at roughly 36 years old. Jefferson County’s population is far greater than other large counties that surround Louisville, like Bullitt County, with a population of 75,653, and Oldham County, with a population of 58,095 (Courier-Journal, 2012). BBC has therefore wisely chosen the most populated area to establish their business. In 2010, the median household income in Louisville has decreased at a higher rate than the national average, which is a concern for craft breweries in the Louisville area, considering that craft beer is a normal good with income elasticity most likely between .4 and 1(Department of Numbers, 2011).

Breweries must be aware of the potential risks that come with alcohol distribution. One sociocultural influence on the craft beer industry is the issue of drunk driving. Social groups, such as Mothers Against Drunk Driving, take a strong stance against this topic by advocating for social change. Kentucky’s drunk driving statistics show that in 2010, Kentucky had a rate of 17.49 accident fatalities per 100,000 people, while the US average was significantly lower at 10.63 per 100,000. Additionally, there is a growing concern for preserving our environment and the consumer trends are moving towards renewable resources and recycling. According to earth911.com, aluminum cans remain most easily recyclable of all materials, yet the craft beer industry has a tendency to only bottle...
tracking img