POSITION PAPER ABOUT “ADOLPH COORS IN THE BREWING INDUSTRY”
General Analysis about Brewing Industry and Market
The US brewing industry is mainly dominated by six main key competitors towards a small number of local competitors. As a reality of the industry, the main costs are the commodity, production costs (brewing&packaging) which oriented major brewers to backward integration in order to become cost-efficient. Cheaper distribution strategies may create real competitive advantage in brewing industry. The competitive rivalry is broken up into three main segments, National, Regional, and Microbrewers. 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. Due to the strong rivalry among existing competitors, new entrants to the industry face many difficult barriers to entry by the existing bigger brewers. Large capital requirements and the need to establish a very strong distribution network are the main barriers. Many laws and regulations may also inhibit a new entrant from coming into the market. In addition to this, the threat of substitute products is moderate in the industry. On the other hand, the demand has grown generally only at less than one percent over the four decades, except the period from 1960 to 1980 which is characterized by the higher consumption of younger drinkers and efficient marketing strategies driven by key market players mainly focusing on pricing and differentiation. Coors in the Brewing Industry
The core competencies of Coors brewing company were the production quality focusing on most qualified inputs and better production processes and the brand positionning emphasizing the image of quality. Coors products differentiation was coming from both in the materials that went...
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