1. food and drink
2. beverages
3. alcoholic beverages
4. cocktails and beer

Strategic & Tactical Business Plan___________________________________________
Strategic & Tactical Business Plan
For
A mer i can B r ewer y I nc.
dba
A mer i can B r ewer y
B eer & W i ne I mpor ts
123 Main Street
Pleasant, MI 12345
Phone: (123) 456-BEER (2337);
Fax: (123) 567-BEER
E-mail:
[email protected]
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Outline Editor – Master Outline
1 Cover Page
2 Confidentiality Agreement
3 Executive Summary
3.1 Objectives
3.2 Mission
3.3 Keys to Success
4.0 Company Summary
4.1 Company Ownership
4.2 Company History
4.3 Start-up Summary
4.4 Company Locations and Premises
5.0 Products and Services or Products or Services
5.1 Products and Service Description or Product Description or Service Description
5.2 Competitive Comparison
5.3 Sales Literature
5.4 Sourcing and Fulfillment
5.5 Technology
5.6 Future Products and Future Services or Future Products or Future Services
6.0 Market Analysis Summary
6.1 Market Segmentation
6.2 Target Market and Segment Strategy
6.2.1 Market Needs
6.2.2 Market Trends
6.2.3 Market Growth
6.3 Industry Analyses or Service Business Analysis
6.3.1 Business Participants or Industry Participants
6.3.2 Distributing Products or Distributing Services
6.3.3 Competition and Buying Patterns
6.3.4 Main Competitors
7.0 Strategies and Implementation Summary
7.1 Strategy Pyramids
7.2 Value Proposition
7.3 Competitive Edge
7.4 Marketing Strategy
7.4.1 Positioning Statement
7.4.2 Pricing Strategy
7.4.3 Promotion Strategy
7.4.4 Distribution Strategy
7.4.5 Marketing Programs
7.5 Sales Strategy
7.5.1 Explain Sales Forecast
7.5.2 Sales Programs
7.6 Strategic Alliances
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
7.7 Explained Milestones
8.0 Management Summary
8.1 Organizational Structure
8.2 Management Team
8.3 Management Team Gaps
8.4 Personnel Plan
9.0 Financial Plan
9.1 Important Assumptions
9.2 Key Financial Indicators
9.3 Explanation of Break-even Analysis
9.4 Explanation of Projected Profit and Loss
9.5 Explanation of Projected Cash Flow
9.6 Explanation of Projected Balance Sheet
9.7 Explanation of Business Ratios
9.8 Explanation of Long-term Plan
10.0 Web Plan Summary
10.1 Web Marketing Strategy
10.2Development Requirements
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
2. Confidentiality Agreement
This agreement is to acknowledge that the information provided by American Brewery Inc.
(“The Company”). DBA: American Brewery Inc. & Unique Wine Imports in this business plan
is unique to this business and confidential; therefore, anyone reading this plan agrees not to
disclose any of the information in this business plan without the express written permission of
The Company. It is also acknowledged by the reader of this business plan that the information
furnished in this business plan, other than information that is in the public domain, may cause
serious harm or damage to American Brewery Inc. & Unique Wine Imports and will be kept in
the strictest confidence.
Upon request, this document is to be immediately returned to Best Beer Inc. dba: American
Brewery Inc. & Unique Wine Imports.
Signature
____________________________________________________________________________
Name (typed or printed) ________________________________________________________
Date ___________________________
This is the business plan for American Brewery Inc. The presentation of this business plan does
not imply an offering of securities.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
3. EXECUTIVE SUMMARY
There is an opportunity in Pleasant, Michigan to expand and further operate a successful alcohol
beverage import and distribution company. The founders recognize this opportunity and have
decided to go forward with the expansion of their company named American Brewery Inc. &
Unique Wine Imports. The Company will further penetrate the market as a leading importer and
distributor of specialty imported beers and ales as well as distinctive specialty imported wines
from foreign wineries and breweries from around the world. The company also holds import
licenses in several other States and has established a strong market position in Michigan with
retail clients that include ABC Fine Wine & Spirits, Total Wines & More, Fresh Market, Whole
Foods Market and a multitude of independent beer, wine and liquor stores. The company will
provide specialty hand crafted niche brands. American Brewery Inc. (“The Company”) is a
Michigan Corporation that was organized and incorporated in the State of Michigan with two
wholly owned subsidiaries that were filed and registered to do business in the State as American
Brewery Inc. (WCBI) and Unique Wine Imports (UWI). This is to leverage the division’s import
and distribution agreement rights and strengthen the company’s position within the alcohol
beverage industry. The company has established itself as an importer distributor of handcrafted
specialty beers, ales and selective imported wines that have been marketed in the U.S.A. Under
its corporate structure, it can handle the marketing and development aspect of these brands in
niche market environments. Its divisions have been, for the past few years, focusing their efforts
in establishing strategic alliances and agreements to represent a wide variety of brands from
other importers and wholesalers in the State of Michigan and in several other states. The
company will establish a state of the art distribution system network. The founders and owners of
the company have a combined 100 years of established experience in the marketing,
development, and distribution fields.
The vision is to market niche brand products in America. The company has established working
relationships with other importers and distributors to market, promote, and develop handcrafted
beers and ales as well as, most recently, distinctive imported specialty wines. American Brewery
Inc. & Unique Wine Imports will serve its area of business working to make its lines more
productive while at the same time controlling expenses.
The founders have provided the money getting the company organized. To make the expansion
of this company a reality there will be an amount needed of $2,700,000.00 to $5,000.000.00
which will come as equity or a loan. The company can commence expansion operations
immediately upon an amount of $1,000,000.00 received for expansion items that include the
purchasing of inventory to fill backorders, working capital, relocation expenses for the
operations in the new warehouse, legal costs for acquisitions and acquisition of two other
companies. One is a beer distributing company and the other is a wine distribution company
covering hiring sales personnel, updating web sites, replacing vehicles, updating logo designs
and including other expenses.
The money will be allocated to take care of all the requirements, including fulfillment of an
elaborate inventory, the purchasing of selective new brands, the relocation of business
operations, and miscellaneous operating expenses. This business plan will show the components
that make up and accomplish this exciting business venture.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
This business is based on two vital components:
1. Excellent management that has a mastery of choosing the right product and the right service at
the right time with a mastery of knowing what its total market is and how to keep gaining a
greater share of that market.
2. Providing an excellent product or service that is not only well accepted now but also whose
acceptance and use will continue to grow at an accelerated rate into the future.
The company will coordinate worker productivity with increasing market demand to ensure
continued company growth and development. Its approach emphasizes the individual
participation of every employee and member of this organization and the total process of
building The company to acquire an ever-increasing market share. By guiding and helping
employees with knowledge and awareness, it will build a solid foundation for achieving its most
ambitious goals. American Brewery Inc. & Unique Wine Imports realizes that this is an ideal
time to expand its business in this growing industry and move forward in a steady progression
over the next five years. Some of the highlights of its strategy are here briefly summarized:
 American Brewery Inc. & Unique Wine Imports has talent and experience that is superior
for the marketplace.
 Profitability is assured by its preparation of knowing what the market requirements are
presently and what the market requirements are to be in the next several years.
 With its strategy and budget in place, sales are expected to multiply rapidly and The
Company expects to move in on the leaders in the industry.
3.1 OBJECTIVES
The company has definite objectives in order to fulfill its desire to participate and achieve an
ever-growing market share of the exciting industry that it is entering. What follows is a brief
summary of the key objectives of The Company:
1. Further penetrate the market as a leading importer and distributor of specialty imported
beers and ales, and of distinctive specialty imported wines from foreign wineries and
breweries from around the world.
2. Develop employee capabilities to ensure a strong foundation for participation in a rapidly
growing company.
3. Increase sales and revenue at a rate no less than 10% per year.
4. Complete additional brand acquisitions.
5. Acquire importing rights on other brands.
6. Establish full network distribution channels.
7. Undertake strategic agreements, alliances and working relationships to further its
objectives and goals of total distribution throughout the U.S.A.
8. Achieving a net income in excess of 15% of sales by the end of the first year of
operations and more than 20% by the end of the third year of operation.
9. Develop strategic alliances and / or merging with larger distributors/importers in order to
gain greater market share and become a more dominant force in the alcohol beverage
industry.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
The Internet will be the company’s prime vehicle for gaining additional brand exposure and
equity while providing effective means of establishing an expanded distribution network on
behalf of retail clients throughout the country. The Company is in the process of updating their
web site and database to facilitate a more user-friendly system of operations. The Internet will
also be used to coordinate schedules of events and highlight certain opportunities that retail
clients could take advantage of from our distribution network.
Based on current market conditions The Company has decided to tap into this opportunity of
niche market brands with higher margin potential. According to the analysts in the alcohol
beverage industry, the import category has shown huge potential and opportunity for the
specialty premium brands of beers, ales and selective imported wines that are difficult to locate.
The import categories have seen a tremendous growth in this past decade and the momentum
potential is likely to continue and sustain the double digits growth for an unspecified period.
According to the alcohol beverage industry indications, a large population of potential
consumers of 21 + years already exists in the U.S.A., which is in excess of 70 million potential
customers. Out of this group at least 70% will annually purchase premium brands of beers, ales
and selective imported wines. This gives The Company a total of 49% potential customers in its
targeted initial market.
The market for specialty brands has been steadily growing. According to industry trend it is
gaining market share in the U.S.A. and is a sixty billion dollar market with all indications of
continuing its growth with no sign of decline. Even with slightly higher purchase points over
domestic brands, this segment of the market has tremendous potential growth opportunity for
several years to come.
Exit Strategy -- The Company believes that liquidity will be achieved for investors via one of
several potential exit strategies:
• Merger / Acquisition — The Company believes that within 3-4 years the Company may be a
prime candidate for acquisition by a large distributing company of alcoholic beverages or a
larger importer.
• IPO — The Company believes that if it is able to successfully expand its model geographically
within 5-7 years it may be positioned to offer shares to the public in an initial public offering.
• Buyout — The Company believes that in building a highly profitable business with strong
brand names, recognition and opportunities for growth, it may be a strong candidate for a buyout
by management or a financial buyer seeking diversity.
3.2 MISSION STATEMENT
The company will strive to excel in the business of specialty imported beers and ales, and of
distinctive specialty imported wines from foreign wineries and breweries from around the world.
The company will provide the alcohol beverage industry with the highest quality of
professionalism, knowledge and service through its acquired expertise and excellence of its sales
people.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
The company plans to create an atmosphere through which the retail clients and consumers will
be provided with professional, personalized service that will enable them to obtain a greater
selection of quality brands. For its employees, The company will provide an excellent place of
work, the opportunity for advancement, and a working environment that will be challenging,
rewarding, and respectful of individuals’ goals and ideas.
The company ultimately will provide excellent value to its retail clients and customers and fair
reward to its founders and employees. What makes The Company different and special is that
American Brewery Inc. & Unique Wine Imports will put in motion a concept of distribution,
marketing and development of niche brand products in America. We have established working
relationships with other importers and distributors to market, promote, and develop strategies
pertaining to handcrafted beers and ales as well as, most recently, distinctive imported specialty
selected wines.
3.3 KEYS TO SUCCESS
The company is confident of the following attributes that it demonstrates as keys to its success:
1. Founders’ abilities to recognize and define the best course of action
2. The consistent raising of productivity
3. Diligent effort to regularly lower overall cost
4. Recruitment of experienced and talented employees
5. Effectively market American Brewery Inc. & Unique Wine Imports
4. COMPANY SUMMARY
The company began its operation in August 1997 as American Brewery Inc.(WCBI), in January
2003 acquired (Best Beer, Inc.) and April 2003 Unique Wine Imports (UWI). The inspiration for
the Company was the realization that there is a need to fill a niche market of specialty-imported
beers, ales and Select imported wines. The company is headquartered in the city Detroit in the
state of Michigan. Its operations will expand in the Southeastern States and will eventually
include coverage in 40 states within the next 3 to 7 years. We will be targeting specific
demographics in age category that appreciate premium specialty beers, ales and selective
imported wines.
4.1 COMPANY OWNERSHIP
The company is set up as a Michigan corporation. John Smith, Mary Smith and Joseph Smith
together hold 100%, of the ownership. Any and all questions relative to ownership should be
directed to them.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
4.2 COMPANY HISTORY
The company is proud of the accomplishments of the people that have made up this company.
American Brewery Inc. & Unique Wine Imports is particularly proud of the fact that The
company holds importer licenses in several other States and has established a strong market
position in Michigan and with retail clients that include ABC Fine Wine & Spirits, Total Wines
& More, Fresh Market, Whole Foods Market and a multitude of independent beer, wine and
liquor stores. The company is also particularly proud of the fact that our divisions have been
focusing their efforts in establishing strategic alliances and agreements to represent a wide
variety of brands from other importers and wholesalers in the State of Michigan and in several
other states. We have established working relationships with other importers and distributors to
market, promote, and develop strategies pertaining to handcrafted beers and ales as well as, most
recently, distinctive imported specialty wines.
4.3 START-UP SUMMARY
The basic organization of American Brewery Inc. & Unique Wine Imports is due to the
dedication of the founder of the company. The money required getting the Company organized
and underway has been provided by the founder of the company. To bring the company to the
next level there will be an amount needed of $2,700,000.00 to $5, 000.000.00 Million which will
come as equity or loan. But we can commence operation immediately and start with an amount
of $1,000.000.00 to $2,700.000.00 million for expansion that includes purchasing of inventory to
fill backorders, Working Capital, relocate the operations in a new warehouse, legal costs for
acquisitions and immediate expansion in regards to acquiring 2 other companies, one is a beer
distributing company and the other one is a wine distributor, hiring sales personnel, updating
web sites, replace vehicles, update logo designs and including other expenses. The funds will be
allocated in the most efficient way possible with detailed actions that will make this growth a
reality.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
EXPANSION EXPENSES
American Brewery Inc. & Unique Wine Imports
Major inventory development with substantial supplies of new brands
Working Capital
Legal, Accounting, & Advisory
Web Development Up-date and Hosting
Marketing and Advertising Promotion
Computers & Technical Support
Vehicles (trucks & cars) Warehouse Equipment & Furniture
Office Supplies
Executive and Administrative Salaries
Office Staff Salaries
Insurance and Bonding
Broker – dealer commissions
States Licenses and Permits Dues
Acquisition of other Brands & Assets
Travel and Lodging Expenses
Sales Staff Salaries
Bank Loan Guarantees
Security Deposits & Fees
Electricity & Utilities,
Payroll Taxes & Benefits
Tangible Property Taxes
Fuel & Maintenance Expense
Estimated Income Taxes Expense
Events Staff Salaries
Sales Commissions
Warehouse Rental Lease
Acquisition Expenses to Date
Total
Maximum
$450,000
$500.000
$150,000
$5,000
$200,000
$15,000
$200,000
$5,000
$200,000
$200,000
$45,000
500,000
$80,000
$850,000
$100,000
$250,000
$150,000
$25,000
$15,000
$200,000
$5,000
$75,000
$75,000
$90,000
$325,000
$90,000
$200,000
$5,000,000
Minimum
$190,000
$200,000
$75,000
$3,000
$75,000
$10,000
$140,000
$3,000
$150,000
$100,000
$20,000
$150,000
$50,000
$600,000
$50,000
$105,000
$150,000
11,000
$5,000
$70,000
$3,000
$40,000
$50,000
$75,000
$100,800
$65,000
$100,000
$2,590,800
4.4 COMPANY LOCATIONS AND PREMISES
The company will maintain its headquarters where its management team will be located in the
city of Detroit in the state of Michigan. A new location will be established in the Industrial
Business Park, South Eastern part of Michigan. At no time will management allow a situation to
exist where the Company is supporting locations or premises that are not absolutely essential to
the most effective operation of the Company.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Demographics: Detroit, Michigan
Pleasant is a city in Michigan. The city is known for its abundant events, performing arts and
downtown museums. The city's population is described as metropolitan, where diverse culture is
commonplace. According to 2004 U.S. Census Bureau estimates, the city had a population of
164,578. Annexation of unincorporated areas in 2005 boosted the city population to 170,823. It
is the county seat and forms part of the South Detroit metropolitan area.
As of the census of 2000, there were 152,397 people, 68,468 households, and 33,001 families
residing in the city. The population density was 1,854.4/km² (4,803.1/mi²). There were 80,862
housing units at an average density of 984.0/km² (2,548.5/mi²). The racial makeup of the city
was 64.27% White, 28.88% African American, 0.23% Native American, 1.03% Asian, 0.05%
Pacific Islander, 1.76% from other races, and 3.79% from two or more races. Hispanic or Latino
of any race were 9.45% of the population.
There were 68,468 households out of which 19.6% had children under the age of 18 living with
them, 32.2% were married couples living together, 11.5% had a female householder with no
husband present, and 51.8% were non-families. 40.3% of all households were made up of
individuals and 11.7% had someone living alone who was 65 years of age or older. The average
household size was 2.14 and the average family size was 2.97. Of the total, 19.4% were under
the age of 18, 7.7% from 18 to 24, 32.8% from 25 to 44, 24.8% from 45 to 64, and 15.3% were
65 or older. The median age was 39 years. For every 100 females there were 110.0 males. For
every 100 females age 18 and over, there were 111.1 males.
The median income for a household in the city was $37,887, and the median income for a family
was $46,175. Males had a median income of $34,478 versus $27,230 for females. The per capita
income for the city was $27,798. About 13.8% of families and 17.7% of the population were
below the poverty line, including 29.0% of those under age 18 and 11.1% of those aged 65 or
over.
5. PRODUCT DESCRIPTION
The company is proud of its main product line and the features and benefits that make up its
attractiveness to this ever-growing market. The main features and benefits of its core products to
its customers include serving as a leading importer and distributor of specialty imported beers
and ales, and of distinctive specialty imported wines from foreign wineries and breweries from
around the world. Some of the strengths and capabilities of its core products as it pertains to shelf
life, durability and availability include the following:
•
•
•
•
•
Service and professionalism.
Support of its retail client base.
Product depth and availability.
Satisfy the consumers needs
Quality of brands
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
5.1 SERVICE DESCRIPTION
The company is proud of its main service line and the features and benefits that make up its
attractiveness to this ever-growing market. The main features and benefits of its main service to
its customers include that we provide the alcohol beverage industry with the highest quality of
professionalism, knowledge and service through its acquired expertise and excellence of its sales
people. Some of the strengths and capabilities of its main service as it pertains to potential
market, ease of administration and availability include that we will create an atmosphere through
which the retail clients and consumers will be provided with professional, personalized service
that will enable them to obtain a greater selection of quality brands.
5.2 COMPETITIVE COMPARISON
The company has done extensive research and investigation of all of the aspects of the
competitiveness of the existing market in which it will be participating. The Company
management team is fully aware of the major competitors who are:
•
•
•
Gold Coast Beverage
J.J. Taylor Distributing
WM. Thies & Sons
The company recognizes these major competitors as a prime focus because they have been
evaluated using criteria of price and value given. This company specifically knows that the
advantages that it has over its competition include that American Brewery Inc. & Unique Wine
Imports will put in motion a concept of distribution, marketing and development of niche brand
products in America. This study of its competition has given The Company a mastery of the
effects of regulatory agencies, business share, pricing strategies, cut-throat or permissive
posturing, as well as strengths and weaknesses of the management teams who head up the
companies that make up the competition.
5.3 SALES LITERATURE
The company is prepared to highlight all of the most important benefits and features in a packet
of sales literature. This information will present a compelling point of view as well as a detailed
explanation why the consumer should exchange their hard earned dollars for The Company’s
essential products and services. The sales literature will be complete in every way and will
answer the questions of who, what, why, when and where of what The Company is presenting.
5.4 SOURCING AND FULFILLMENT
The company is totally prepared in the preparation for ease and completion of fulfillment
requirements. All aspects of fulfillment have been considered, evaluated and highlighted for the
purpose of assuring both customers and pertinent employees that fulfillment will never be a
major concern.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
5.5 TECHNOLOGY
The company has positioned itself in a way to take full advantage of all the technology available
for its particular industry. Management has determined that when necessary that state of the art
software and appropriate hardware will be implemented to assist all employees in gaining
maximum productivity. In particular, The Company will be utilizing accounting procedures both
off-line and online to monitor weekly, monthly, quarterly and annual results of all aspects of
operations.
5.6 FUTURE PRODUCTS AND FUTURE SERVICES
The company is currently using its experience and talent to position itself in future markets with
the appropriate future products and future services. Its current product and service lines, which
include the distribution of specialty imported beers and ales, and of distinctive specialty imported
wines from foreign wineries and breweries from around the world, are sufficient in today’s
demanding market and will fare very well in future years as well. In addition to this, The
Company is developing enhancements as well as creating new products and services to keep its
position in the marketplace ever expanding.
6.0 MARKET ANALYSIS SUMMARY
The company has done an exhaustive study of the state of its industry. This industry is one of the
most exciting industries in the United States. It presents an ever increasing market, a very
healthy bottom line, and excellent opportunities for growth. The outside world demands a
company that will provide excellent value to its retail clients and customers and fair reward to its
founders and employees. The Company has all this to offer and its management team will keep
its finger on the pulse of market demands. This industry is getting more competitive as
consumers are getting more knowledgeable about import beers, ales and specialty wines. This is
why American Brewery Inc. & Unique Wine Imports fits perfectly for meeting the demands of its
industry. Led by a seasoned veteran of the alcohol beverage industry and a recognized expert on
imported brand beers and ales, the company has established a strong and growing line of
proprietary ownership of brands and is poised for significant growth over the planning horizon.
Revenue will be driven through the addition of new brands, added focus on the imported wine
business, expanded geographic coverage, selected acquisitions and new distribution channels.
Among the many innovations the company has embraced to assure sustainable growth and
higher margins is a strong focus on ethnic markets and the development of proprietary ownership
of its brands. The ethnic segment of the market has shown the greatest potential for growth and
has been largely ignored by the vast majority of competitors. This strategy allows the Company
to further differentiate themselves from other providers. The company’s proprietary ownership of
brands is sourced from around the world and several of those brands have reached a very
receptive audience.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
The Company’s ability to meet or exceed its financial objectives and its set goals is based on the
following:
•
•
•
•
•
•
•
•
•
A state of the art ordering and inventory tracking system is being developed to assure the
Company is able to handle the anticipated volume increases that are projected over the
next five years.
An exceptional reputation for quality brands
Strong ethnic Brand focus and marketing efforts
Highly individualized client support
Focus on lesser known brands with higher margins
Sourcing expertise / contacts
Proprietary brand ownership (beers & Ales) and selective imported wines
Forward thinking management team
Planned high-tech inventory / order processing system
Brewing beer is an important tradition in many countries around the world. From country to
country, region-to-region, the many styles, colors and tastes can become very complex. The
water source, the choice of barley malt and hops, and also the brewing techniques of each region
give us the unique beers we find in the "Import Category". Most of the recipes date back
centuries ago. The arrival of these "Imports" to the United States gives us a great variety of
international tastes and traditions from around the world.
The Opportunity -- Americans spent nearly $75 billion on beer in 2003 and imported beers and
ales is the fastest growing segment of the American beer market. According to the 2003 Adams
Beer Handbook, imported beers and ales have nearly tripled case sales in the past 10 years.
Today, over 10% of the American beer market is imported beers and ales, and consumers from
every economic, social and cultural ethnic group are enjoying great selections of brews.
Americans spent over $18 billion on wine in 2003 according to IDC. Total wine sales grew 3.4%
while imported wine sales were up 16%. Imported wine-sales continue to expand rapidly while
sales of domestic wine have stalled with no growth in value and just 1.1 percent in volume over
the previous year.
The total U.S. beer market has grown by just 1 per cent since 1998 and when handcrafted beers
and imports are removed from this number, the consumption of beer from the big three has
actually declined. Domestic premium beer, popular beers like ice beers have all declined in the
US, with the gap in consumption being filled mainly by imported beers and ales that have risen
by over 9 percent during the same period.
A factor impacting the sales of imported beers, ales and wines is the growing influence of ethnic
preferences. Appealing to various ethnic groups has never been a major concern of the large
domestic beer producers. Ethnic groups in America were expected to assimilate into the
mainstream over time, making it a case of Mohammed coming to the mountain.
Increasingly, however, time is proving this strategy to be faulty. As a result of many economic
and social factors, marketers are beginning to discover that America is no longer the melting pot
it once was. Instead of looking to assimilate, many ethnic groups want to maintain their own
cultural integrity and they have retailed a fierce loyalty to brands that are unique to their specific
ethnic group.
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American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
With a few notable exceptions, the imported beers, ales and wines is comprised of mostly small
independent importer, distributors and wholesalers who focus on a relatively small geographic
areas. They collectively offer very little other than time and place utility with minimal marketing
efforts, growth expectations, marketing, etc.
Planned Growth Strategies The company is strategically headquartered in South Detroit that
offers ideal access to ports of entry as well as a very diverse market base. The second phase of
the company’s growth plan scheduled to being later this year includes expansion to cover the
Southeast with The Company eventual coverage to include up to 40 states over the next five
years. Additional growth plans include the following:
•
•
•
•
Acquire proprietary brands that are unique to the company
Acquire additional importing rights on other proprietary brands of beer, ale and imported
wine
Establish and expand additional distribution channels
Engage in the development of strategic alliances of distribution throughout the U.S.
"People are drinking less but drinking better," says Ron Christesson, director of marketing for
Gambrinus, importers and marketers of Corona. Pat Droesch, director of beverage for Brinker
International, says he also sees people paying more for beer but drinking less in Brinker's
restaurants, which include Chili's, Romano's Macaroni Grill, On the Border Mexican Cafe and
six others. "If a customer is only going to have one or two beers, he'll go for a heavier or bigger
beer," says Droesch, noting that imported beer sales have increased at their restaurants, where
they match the type of beer to the restaurant concept.
The Market -- Beer is America's most popular alcoholic beverage and freshness, handcraftsmanship and variety are becoming increasingly important qualities of beer brands among
American consumers. But over the past several decades, however, the US beer industry has been
through a period of intense consolidation. Where there once were hundreds of local and regional
breweries offering different types and styles of beer, now their three giants who dominate the
domestic beer market with an estimated share of 97%. Handcraft brewers have made some
inroads but their sales are less than 3% of the total and that number hasn’t changed dramatically
in recent years. The only segment of the industry that has grown is the sale of imported beers and
ales.
For thousands of Latin Americans, the drought is finally over. Argentina's Quilmes Venezuela's
Polar, Philippine’s San Miguel blonde and dark are among at least a dozen beers that are being
added to shelves as breweries in Latin America, eager to claw a foothold into the U.S. market,
tap immigrants' nostalgia and taste for home. Many Latin Americans are dedicated to their
national brew, a preference that goes beyond brand loyalty and is more a symbol of national
identity and pride.
Corona, the nation's best-selling import, recorded volume sales of 6.8 million barrels in 2003,
according to trade publication Beer Marketer's Insights. The brand now commands a 3.3 percent
share of the total $67.4 billion U.S. beer market and 30 percent of the imported beer market.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
At the end of 2003, beer industry experts were predicting declines for Corona in the wake of a
very aggressive year-end price hike. Yet, Corona Extra sales for The Gambrinus Company are
up nearly +8% YTD for the first half of 2004! This strong growth is well ahead of the rate of
Corona sales in the west, and ahead of the +6% nationwide average.
"We developed a Q1 promotional strategy a company that will provide excellent value to its
retail clients and customers and fair reward to its founders and employees to help offset affects of
the increase with our distributor partners," said Don Mann, Modelo Group General Manager
for Gambrinus. "Our investments in advertising and an improving economy have also helped."
Gambrinus has not only driven sales of Corona Extra higher, sales for its other Modelo brands
are on fire, as well. Sales for Corona Light are up +10% YTD, and sales for Modelo Especial
are up an amazing +34% YTD. Gambrinus company sales represent 63% and 52% of all U.S.
sales for Corona light and the total Modelo Brand portfolio, respectively.
That performance ranked Corona ahead of mainstream U.S. brands such as Busch Light, Miller
High Life and Miller Genuine Draft, and was a 10% increase over Corona's 2002 volume sales.
Constellation Brands, Inc. a leading marketer of alcohol beverage brands reported record net
sales of $927 million, a 20 percent increase, for its first quarter ended May 31, 2004.
Constellation, who distributes over 200 brands of wine, imported beer and spirits, became the
world's biggest wine company with the acquisition of BRL Hardy in 2003. The Company also
reported that first quarter operating income for Constellation Wines rose 14 percent to reach
$US68 million. Branded wine sales in 2003 rose 17 per cent to reach $US364 million. Beer sales
increased 14 per cent 2003 with demand picking up more quickly than expected following a
price increases on its Mexican beers.
Constellation Brands reported record net sales of $927 million, up 20 per cent, for its first
quarter, ended May 31, 2004.
Constellation, who distributes over 200 brands of wine, imported beer and spirits, became the
world's biggest wine company with the acquisition of BRL Hardy in 2003,
The Company also reported that first quarter operating income for Constellation Wines rose 11
per cent to reach $US68 million. Branded wine sales in 2003 rose 17 per cent to reach $US364
million. Beer sales increased 14 per cent 2003 with demand picking up more quickly than
expected following a price increases on its Mexican beers.
Both divisions are managed and operated as separate profit centers and both have specific goals
and objectives pertaining to the marketing, new business development, revenue, profitability and
strategy as well as public responsibility in the alcohol beverage industry. Regular operation
controls include monitoring progress against specific goals and objectives correcting deficiencies
and setting attainable goals and objectives.
Market -- Positioning the Company is in a prime position to leverage its strength, market
position, distribution rights and contacts within the alcohol beverage industry.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
The company has established a very strong and growing base business in Michigan as well as in
surrounding states with retail clients that now include ABC Fine Wine & Spirits, Winn Dixie
Stores, Total Wine & More, Fresh Market, Whole Foods Markets and a multitude of independent
beer, wine and a large number of convenience stores.
The Company is an importer distributor of handcrafted specialty beers, ales and selective wines
that are being marketed in the U.S.A. Under the corporate structure, The Company has also
developed their own proprietary ownership of brands that are being sold successfully in niche
markets. Management has focused their efforts in establishing strategic alliances and agreements
to represent a wide variety of brands from other importers and wholesale/distributor in Michigan
and in several other states. Efforts will be put in place to complete a state-of-the-art distribution
and logistics system that will allow further improved operational efficiency, lower costs and
allow for the effective management of planned growth objectives.
Market Knowledge and Expertise the mission the Company is to provide the target market with
the highest quality of professionalism, knowledge and service through its acquired expertise and
excellence of its sales people. The Company will deliver a very high level of qualified
experience, knowledge and know-how, with a high level of confidentiality.
The company will continue to pursue opportunities within niche market brands that offer higher
margin potential. The import category caters to a diverse audience that have distinctive tastes
along with the desire identified with brands that fit their particular taste and lifestyle. The import
market has demonstrated a diverse potential and opportunity for the specialty premium brands of
beers, ales and selective imported wines that are difficult to locate.
Unlike domestic brands, imported beers, ales and wines present something of a challenge to
retailers. There are literally hundreds of imported beers, ales and wines available to the leading
retailers and knowing which brands to sell is not an easy task.
The reason that a growing number of customers have come to rely on The Company (and
management specifically) is that John Smith not only knows the industry but he also knows the
subtle differences and characteristics of the individual styles of beers and ales from various
breweries. He has traveled extensively in Belgium, France, England and other key regions and
has physically visited the vast majority of these breweries on occasions. As a result of theses on
site visits, tastings and tours, he has also become very familiar with the owners, the managers
and key employees. With the ability of speaking other languages fluently, John has the unique
ability to converse with these key individuals completely unencumbered.
With retail trends in the food and alcoholic beverage industry leaning more towards offering
products that cater to their local demographic and ethnic populations, the knowledge The
Company brings to the market is invaluable.
Scope and Future Expansion The Company is presently focusing its efforts in the State of
Michigan but future expansion plans are to open the markets in the Southeastern States and
eventually to include coverage in 40 states within the next 3 to 7 years. We will be targeting
specific demographics in age category that appreciate premium specialty beers, ales and selective
imported wines.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
The U.S. alcoholic beverage industry is dominated by beer. Of the three major market segments
malt-based beverages (primarily beer), wine and distilled spirits, malt beverages are by far the
largest segment, accounting for more than 87% of the total volume in the US and 50% of retail
sales.
The US beer market accounts for nearly 20% of the global beer volume and is by far the most
profitable beer market in the world. Volume in the US beer market is about 200 million barrels
and demand is currently growing by about 1% per year. The US beer market is about $60 billion
at retail. This is due primarily to significant mark-ups at retail, as wholesaler revenues of $30-35
billion are about half as large as that of the non-alcoholic beverage makers.
The US beer industry is highly consolidated, with three major companies representing nearly
80% of total industry volume. Anheuser-Busch is the market leader, with close to a 50% share of
the total beer market in the US. It has enjoyed consistent market share growth historically,
increasing market share from 36% in 1985. SABMiller is the second largest brewer in the US,
commanding about 19%-20% of the total market. This Company has been losing market share
since the mid-1990s, when it peaked at 22%-23%. Coors accounts for a 10%-11% market share - its share grew modestly over most of the past 10-15 years before stalling in 2001. Pabst, after
selling some brands to Miller in 1999, now accounts for less than 4% of the total beer market.
The market share of imports has been increasing over the past several years, and now represents
about 10%-11% of the US beer market.
42% of adults consume beer on a regular basis according to AB Market Research. This compares
to 38.2 for wine and 24.7 percent for spirits. Beer generates nearly 4 times the retail sales of
wine. Industry Trends A 2003 industry report from Goldman Sacks identifies three major trends
evolving in the competitive landscape in the beer industry. First, the traditional domestic beer
market has been shrinking, as consumer preference has been shifting toward imports and
flavored alcoholic beverages. Second, competition has been changing from being driven by price
to being driven by new brands and advertising. Third, there has been increased consolidation
among brewers as well as among wholesalers.
The high-priced beer segment, mainly imports, and more recently the flavored alcoholic
beverage products (FABs), or “malt alternatives,” has been the key growth driver of the beer
industry over the past several years, with growth in the high single digit range. This has become
a key issue facing the major domestic beer companies because they tend to be underrepresented
in the fast-growing high-price segment. Domestic beer shipments declined in each of the last two
years, and that the traditional domestic beer market shrank in 2003 as virtually all of the industry
growth went to imports and FABs.
None of the major domestic beer companies are well positioned in the high-end market.
Anheuser-Busch’s share of the high-end market is only about 20% even if The Company is given
credit for 50% of Corona’s volume (A-B owns 50% of Grupo Modelo, the brewer of Corona).
SABMiller and Coors have even lower shares of the high-priced segment at only 2%-3%. On the
other hand, Anheuser-Busch and Coors have a disproportionately higher share of the premium
segment where growth has been much more muted. SABMiller has a higher share in the subpremium segment where volume has been declining about –3%-4% annually over the past five
years.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Industry Consolidation Increasingly, the brewing industry is becoming polarized with large-scale
consolidation among giants on one hand and the emergence of smaller domestic handcraft
brewers and importers on the other.
Stagnant domestic beer sales and increasing pressure to expand have forced the hands of the
nation's top brewers - get bigger or get bought out. In 2002, South African Breweries Plc bought
Milwaukee-based Miller Brewing Co. for $5 billion, making the combined company,
SABMiller, the second-largest brewer in the world. In November, San Antonio-based Pabst
Brewing Co., the No. 4 U.S. beer maker, put itself on the block.
In an effort to boost profit margins and still be acceptable to the broadest possible market, the
mega-brewers have resorted to using cheaper adjuncts, like corn and rice, instead of all barley
malt. The resulting less-sweet beer doesn't need as much balancing bitterness, so they cut back
on hops to save money and to make the end product innocuous to the casual drinker. The change
has been a gradual one, taking place in small increments over many years, so that most
consumers would not notice the difference. Huge, multi-media, marketing campaigns that
attempt to sell brand image rather than beer flavor, follow up these practices.
Industry Structure Alcoholic beverages in the US are distributed through what is commonly
called the “three-tier system.” The three tiers are manufacturer producer, importer, wholesale
distributor and retailers. All states have mandated the separation of the production tier from
retailing. This system was created by states following the repeal of Prohibition by the 21st
Amendment to the US Constitution in 1923. It was aimed at preventing recurrence of marketing
abuses that characterized supplier-retailer relationships before Prohibition.
Imported beers and ales are produced overseas by international manufacturer producer and
brought into the US by importers. Importers generally have exclusive rights to certain brands in a
given territory, and are responsible for marketing those brands. An example of a leading importer
is Constellation Brands, which is the exclusive importer of Corona in the western half of the US.
Wholesalers Beer wholesalers serve as the middle tier in the three-tier system. They purchase
beer from brewers and importers, and in turn, take the finished product to various retail outlets.
The number of beer wholesalers has declined from more than 5,000 nationwide in 1970 to fewer
than 2,500 today.
The wholesaling business is still highly fragmented despite an increased pace of consolidation.
Moreover, beer distribution in the US is a labor-intensive service business, with distributor
profitability driven primarily by the number of cases of beer that are “dropped” at each retail
location.
For a distributor, increasing the number of cases dropped at each account means improved
profitability, which allows the distributor to increase sales and service accounts. Most of the
leading beer wholesalers in the US are either exclusive wholesalers or independent multi-brand
wholesalers. Anheuser-Busch has been moving its distributors toward exclusive wholesalers,
whereas Miller and Coors have been encouraging their wholesalers to become “shared” houses.
Currently, exclusive wholesalers distribute more than 62% of A-B’s volume.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Retail outlets (on-premise and off-premise outlets) There are two broad categories of retail
outlets for beers, ales and selective imported wines: on-premise and off-premise. On-premise
outlets account for about 25-30% of total industry volume, and include bars or restaurants that
carry a limited number of brands and command a very high margin. Off-premise outlets include
supermarkets, grocery, and convenience and liquor stores. These outlets carry a much broader
selection of brands, but average margins are substantially lower than those of on-premise outlets.
Convenience stores (C-stores) account for about 25% of the total beer volume and food stores
another 15-20%. Due to state regulations, there are 18 “control states,” where the state
government serves as the wholesaler, and often the retailer as well, for wine and spirits. This can
limit flexibility in merchandising beer at the local level. Beer is generally sold through the
private sector in all states.
Light beer sales last year grew 2.5% bringing light's share of market to more than 45%. The
gains have come largely at the expense of the regular sub-premium and premium segments as
consumers trade up and look for products with a healthier image and lighter taste profile.
"Budweiser is a good example," said Jim Koch, president of Boston Beer Co. "It's had the
world's best ads for the past 15 years, a great wholesaler network, marketing support from the
world's largest brewer. In spite of all that, Bud will have its 14th consecutive year of sales
declines."
Value chain US beer industry Brewers added value in manufacturing, marketing and promotions.
Brewer net revenue (net of excise taxes) accounts for about 40% of retail beer sales. Brewers add
value in the value chain two main ways. First, brewers take the raw materials, brew beer and
package it into finished brands. In addition to raw material costs, labor and other costs ($1.6
billion) and factory overhead costs ($1.9 billion) make up the brewers’ total cost of goods sold at
$10.6 billion, or nearly 18% of the retail price of beer. Second, brewers are responsible for
marketing and promotional activities. We estimate that brewers spend about $2.1 billion on
marketing and $1.4 billion in general, administrative and other expenses. This leaves brewers
about $4.2 billion in profit per year. We note that a large brewer can spread its fixed costs over a
large volume base, and is able to take in a disproportionately higher share of the industry profit
pool.
Beer wholesalers’ value-added is in distribution. We estimate beer wholesalers collect $30-$35
billion in revenues, similar to the revenues generated by the soft drink bottling companies. The
biggest portion goes toward paying for finished products, as wholesalers carry a gross margin of
less than 25%. Wholesalers add value primarily through distributing beer to various retail outlets.
We estimate that about $5-$6 billion is used toward wholesalers’ operating expenses including
transportation, labor, warehousing, and other overhead expenses. The profit payout for
wholesalers is relatively low at about $2 billion, or 3%-4% of the retail beer sales.
Once considered an oxymoron, full-flavored light beers are contributing to the bottom line of
several importers as well. Amstel Light, long the only imported light beer, has seen growth of
20% or more in many markets the past few years and 12.7% growth nationally last year.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Labatt Blue Light also is on fire, growing more than 30.6% last year. Corona Light also saw
close to 20% growth last year.
"It's a new area for people to compete on," said Dave Perkins, president of Molson USA. "I
suspect that consumers are looking more and more for drinkable products and lighter flavor. At
the same time, there's been a rapid growth of imports because of people trading up, so it makes
sense that the same shift to lights would happen in the import category."
BEER INDUSTRY SHIPMENTS 1992 THRU 2003 all figures in Barrels-000
Year
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002*
2003*
Tax
paid
180,824
180,901
179,687
176,900
177,959
177,439
177,318
179,629
179,205
179,171
180,400
179,400
NA
Domestic
2,288
2,214
1,949
1,953
1,842
1,645
1,545
1,485
1,400
1,340
1,300
1,225
Imports
8,408
9,348
10,602
11,394
12,557
14,324
16,446
17,897
20,116
21,891
22,212
23,663
US
Shipments
191,520
192,463
192,238
190,247
192,358
193,408
195,309
199,011
200,721
202,402
204,912
204,288
-free
5,612
5,467
7,329
8,482
7,906
6,585
5,780
5,145
4,680
4,550
4,250
3,900
Tax
Total
97,132
97,930
99,567
98,729
00,264
99,993
01,089
04,156
05,401
06,952
09,162
08,188
Retailer mark-up is a significant factor in beer. Retail mark-up in beer is high, accounting for
more than $25 billion of the $60 billion that total retail beer sales command. As with the soft
drink industry, the vast majority of the mark-up at retail comes from the on-premise (bars,
restaurants, etc) channel, which accounts for about a quarter of total industry volume. The retail
price of beer varies significantly by channel, as average price in the on-premise channel is
estimated to be nearly 2.5 times the average price in off-premise channel. In aggregate, retailers
carry a margin in the 40% range. However, this figure is also somewhat distorted, as on-premise
outlets are estimated to command margins in the 65-70% range, whereas we estimate that offpremise outlets carry margins in the 20-25% range.
Beer industry performance drivers Beer consumption in the US correlates with three key
factors—demographics, pricing relative to CPI growth and income growth. A change in the
demographic trend, in particular, historically has played a key role in US beer volume
performance. In the 1970s, the US beer market grew at an annual rate of nearly 4%, as baby
boomers reached legal drinking age. US beer demand growth slowed to 0.6-0.7% during the
1980s, as baby boomers passed the peak beer consumption age and states raised the legal
drinking age to 21. In the late 1990s, unit growth began to pick up again as the key 21-28 year
old age group started to grow again. This demographic shift was widely expected to drive
stronger unit growth for the industry, though results have been modestly below expectation. One
thing that could be working against the beer industry is the aging of the baby boomers, and the
associated decreases in per capita consumption as that generation moves into the 50s.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Despite the shrinking demand, the US beer market has been moving away from price
competition over the last few years as major brewers have focused more on profit growth and
less on market share growth. Operating profit growth for the traditional domestic beer companies
has been generally strong in recent years, benefiting from a favorable pricing and cost
environment.
However, we have now begun to see the competitive landscape shifting to being driven by higher
media spending and new brand introductions. The implication of this is that the cost of doing
business appears to be rising throughout the industry, which means that industry profit pool
could increase at a more moderate rate than we have seen in the past.
Marketing costs are going up not only for the FAB participants, but also for traditional domestic
brewers as they try to defend market share:
•
The cost of introducing FABs is very high. The total media spending for the beer industry
amounted to about $1 billion in 2001, and we understand that over $400 million of
marketing funds have been allocated to just the FABs in 2002. The FABs can support
high marketing costs since they are higher-margin brands. Introduction costs of $60-100
million per brand we have seen so far can be justified if a brand commands around 1
million barrels of volume.
•
However, marketing costs are going up for traditional beers as well. This has resulted in a
higher cost of advertising for traditional beer, as share of voice and consumer mind-share
are being impacted by the FABs. Anheuser-Busch has been increasing its marketing
spending budget this year in order to protect its core beer brands in terms of both share of
budget and share of consumer mind.
Consolidation In addition to consolidation among the worlds largest breweries, we have also
seen an increased pace of consolidation among brewers and wholesalers in recent years. For the
brewers, consolidation has been taking place both within and outside the US. The Stroh Brewery
Company, then the number four beer company in the US, decided to exit the beer business in
May 1999 by selling its brands to SABMiller and Pabst. Outside the US, several transactions
have taken place as global beer companies are attempting to build scale. Some notable recent
transactions include Interbrew’s acquisition of Bass, Coors’ acquisition of Carling, and SAB’s
merger with Miller. Anheuser-Busch, on the other hand, has been opting to maintain equity
investments in breweries in fast-growing markets, shying away from large transactions with high
price tags.
On the wholesaler front, we have seen increased consolidation among Miller and Coors’
wholesalers. Almost 40% of each company’s volume is now sold through consolidated houses.
In most instances, consolidation has been driven by the need for economic survival, as either a
Miller or a Coors wholesaler typically competes against a much bigger and financially stronger
Anheuser-Busch wholesaler in a given market. As Miller and Coors wholesalers consolidate,
they command higher market share and make more money per case.
Its origins are lost somewhere in the Stone Age, long before history was recorded.
Anthropologists can only guess how it happened, and their guesswork goes something like this:
once, in the camp of some nomadic hunter-gatherers, there was a supply of wild grain,
painstakingly collected for food.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Somehow, possibly in a sudden rainstorm, a pool of warm water formed where the grain was
stored. In a short time the grain fermented, turning the water into a thick dark liquid. Some
adventurous soul among these primitive people sampled the liquid, and found that it tasted good.
Man had discovered beer. From that time to the present, beer has been an important part of life
in virtually every society on earth. It was brewed by the ancient Babylonians and Egyptians and
Chinese. It has been used in religious rituals, depicted on coins, honored in epic sagas. Through
all the centuries, in moments of triumph and celebration and fellowship, no drink has contributed
more to man's enjoyment than beer.
Premium Beer Segment While the beer market as a whole has been static in many regions; the
premium sector has been showing healthy growth and, according to a recent report from justdrinks.com, will continue to do so for some time to come.
In the U.S. the premium beers and ales have been something of a lifeline. In recent years, it has
been and remains the fastest growing segment of the beer market, both globally and in many
regions.
Moreover, in the mature markets of the UK, the US and Germany, to name a few, it has
delivered the only significant growth in the alcoholic beverage industry. And as we move
forward, it will continue to gain in importance with the major international brewers diverting
greater amounts of advertising and promotion to a highly competitive but also highly profitable
sector.
After losing market share for its 106-year-old super-premium Michelob brand, Anheuser-Busch
counters competition from import brands such as Heineken and Amstel Light with a new slopedshoulder bottle design and new graphics on secondary packaging for Michelob and Michelob
Light. Dave Peacock, vice president of high-end brands at Anheuser-Busch, says, "Over the past
several years, the high-end segment of the beer industry has begun to attract more 21- to 27year-old consumers. Our new advertising and packaging will enhance our brands' appeal to this
audience." Bob Lachky, vice president of brand management, adds, "This brand is trying to get
young and urban and have ethnic appeal. It was starting to lose its relevance with contemporary
beer drinkers."
Sales of premium beers and ales by volume increased fairly rapidly between 2000 and 2003
whilst the total beer market was relatively static. Premium beers and ales sales accounted for
around 15% of total beer sales in 2000 but by 2003 premium beers and ales accounted for 20%
by volume, according to the latest report from just-drinks.com.
"If there ever was a business that is almost recession-proof, its imports," said John Lennon,
president of Beck's NA. "They've experienced only one down year in nearly 20 years since I've
been in the business, and that was in 1991 when the federal excise tax doubled."
The report – “A global market review of premium beers and ales - with forecasts to 2010” –
shows that premium beers and ales are 10% to 20% higher in unit price than standard beers,
adding to their importance in an alcoholic beverage industry where brewers are constantly
battling against low margins brought about by retail and consumers pressure. According to justdrinks.com, global sales of premium beers and ales totaled US$86 billion in 2000.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
By 2003, total global premium beer sales had risen by nearly 35%, to US$116 billion,
representing an average annual growth rate of 11.6%. In volume terms, just-drinks.com estimates
that the global market for premium beers and ales grew by a massive 79% between 2000 and
2003 to 269m hectolitres (hl) of beers and ales. IMPORTED BEER MARKET Figures are up
across the board on imported beers and ales sales. In a year of otherwise calm growth of 1.5% for
the entire industry, imported beers and ales continue to sell well over the industry average taking
share away from both the giants as well as the smaller handcrafted brewers. Corona, for example,
was up 21.3%, Labatt Blue hung ten at a 13.5% growth, and Amstel Light logged in a
heavyweight 15.4%. Traditional segment leaders like Beck's and Guinness continued strong,
steady growth, while powerhouses from Mexico such as Tecate were up more than 16%, and
Modelo Especial, up 28% (Source: Adams Handbook Advance 2003).
The surge in imported beer and ale sales seems to have taken the wind out of the sales of the
microbrewers, even though most people are of the opinion that the "micro phenomenon" had a
lot to do with the renewed interest in micros. "People have tried the micros; obviously there are a
lot of good ones. But trying micros opened them to the whole import category, and they're trying
brands with quality and tradition," according to Fred Graefenhain, Marketing Director for Barton
Brands -importers of the St. Pauli Girl beers, among others.
“Brands with Quality and Tradition” This catchphrase is echoed in various ways by the major
European imported lagers: Heineken, Beck's, Amstel Light, and St. Pauli Girl. They certainly
have a right to it; the youngest of these breweries is over 120 years old. Sales are up for all four
brands, so the idea must be working with the consumer as well.
They also have something going for them that are often overlooked in the import market: they
are lager beers, the kind of beers most Americans - and most people around the world enjoy
every day.
These beers have always sold well with ex-patriates, and likely always will. People like that
authentic taste of Europe, whether they're remembering their old home or enjoying their roots.
For Heineken, the tradition is different. Heineken is a brilliant example of the thinking that made
the Dutch a minor world power in the 17th and 18th centuries. Faced with a small country
surrounded by sometimes-hostile neighbors that had invaded numerous times, the Dutch took to
the seas and the rivers to trade, and built a rich empire. In that spirit, Gerard Adriaan Heineken
purchased an operating brewery and built it into an exporting giant. Today, Heineken is the
world's second largest brewery. According to Dan Tearno, VP of Corporate Affairs for Heineken
USA, "Heineken sells more beer outside its home country than any other brewer. It is sold in
over 170 countries. It is the most international brand in the world." Through purchases of
national breweries, Heineken is now the largest brewer in Italy and Poland, and when its
purchase of Cruzcampo goes through, it will be the largest brewer in Spain. And you thought it
was just Dutch! Heineken's demographic base in the US is about as broad as the beer's world
market. With a history of US importation going back to 1894, and 66 straight years of postRepeal imports, Heineken has built strong position of familiarity here. Dan Tearno talks of the
brand's broad appeal with pride. "Our demographics are very broad. We have a very strong
Caucasian franchise, but we're strong in the African-American and Latino demographics as well.
Regionally, we're strongest in the northeast."
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
One of the trends brewers had counted on to help fuel industry growth has proved to be
somewhat unpredictable The 1990s saw the key 21- to 27 year old population decline. That
demographic group has been growing again for the past few years, and is expected to swell by
more than 5 million by 2010.
While this group represents only 13% of the adult population, they account for 26% of beer
consumption and are a key driver of industry volume growth.
Not only are there more of these consumers entering the market, but they are more sophisticated,
more brand conscious and more well off financially than any previous generation at the same
age. Part of what has fueled the growth of products like imported beers and ales is consumers'
willingness to pay higher prices for quality.
On the shelf, Heineken is priced more like a microbrew than a domestic light beer. Faced with
the choice, why would a consumer pick Heineken? "Not to put too fine a point on it," says
Tearno, "but we've been brewed with pride since 1873. That's a little better than "brewed with
pride since 1998." It's a deserved reputation for high quality and dependability. Freddie Heineken
says a bad bottle of Heineken is a personal insult. We have as high-quality a group of production
people as any other brewery in the world. And we have the A-yeast, a proprietary strand first
isolated in 1873 by a student of Louis Pasteur that we're still using today."
Labatt's Belgian brand manager is Filip Wouters, and he's big on Belgians. "The Belgians are a
hot category," he says. "Last year they were the fastest-growing country of origin for U.S.
imports, and this year they're still growing at 55%. The other countries are growing at a
maximum of 20%."
While Corona may have overtaken Heineken's long-held spot as the best-selling imported beer in
America, the Dutch treat is still growing at a rapid pace. Dan Tearno again: "The brand is
growing strongly in the metro areas. It's less developed in the west, but that's the fastest-growing
region in the country right now for Heineken sales. Every region is growing, but they've got a
higher percentage growth. Heineken USA is growing at an accelerating pace."
That says a lot for the brand, considering Corona's strength with the growing Latino
demographic. The rising import beer tide is lifting everyone's boats, and while one brand may lift
more than another for a while, no one is hurting. Certainly not Heineken USA, according to
Tearno. "If you look back over last year's profits, we grew 29%, and we grew 7% in volume."
Not too shabby by any standards.
Heineken USA's other big gun is Amstel Light, the best-selling imported light beer in the US "by
a substantial margin," Tearno is quick to point out. The beer was developed specifically for the
American market, though it is now sold internationally. "It grew in New York City," says
Tearno, "then in other metro markets. That's where it does best." Amstel Light's demographics
are very attractive: "It's a pretty close split between men and women.
The consumer base is a sophisticated one. It's an upscale brand for upscale folks. It's really a
great package - full-bodied light beer at 95 calories."
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Beck's beer is the best-selling German beer in the US, and the country's fifth largest imported
beer (1998). It's also the most exported beer from Germany overall. That might put you in mind
of Heineken's story, and while the numbers are smaller, there's a connection. Beck's is brewed in
Bremen, the city next to the port of Bremerhaven and one of the cities of the old Hansa trade
group from the middle Ages. The Baltic coast of Germany has traditionally made its living from
the sea, either through fishing or trade, and this tradition extends to its breweries.
Beck's was first imported to the US in 1964 by a company then known as Dribeck Importers.
About 30 years later The Company was sold back to the brewery, which changed The
Company's name to Beck's North America about two years ago. Yetman's company is now
responsible for the importation of Beck's to all of North America - the US, Canada, the
Caribbean, "and hopefully soon to Mexico," he told me. The Company is doing well, according
to Yetman. "We have been surging for the past two or three years with the same double-digit
growth as the import segment. Some of that is the economy, some is the return to the classics
after experimenting with micros."
Beck's, like Heineken, has a broad appeal to all segments of the market. There is no particular
group that buys more Beck's, according to Yetman. "We're fortunate that sales are strong across
the country and in all segments from 21-50." While the brand goes through the same cyclic
swings as the whole beer market, the fourth quarter is the strongest. "That's our big quarter,"
Yetman said, "leading with OktoberFest and consumers trading up for the holidays, along with
traditional summer business." All the imports do better during the holidays. Dan Tearno says
"that's true for most imported beers. People trade up for holiday parties; people want to get the
best for their friends."
Improved Logistics have also improved dramatically in the imported beer market. Not too many
years ago, importing beers and ales from Europe were a long and involved process. It would take
weeks and sometimes months for beer to get from the European brewery to the port, onto the
ship, out of the harbor and across the North Atlantic, off the ship to the warehouse, to the
wholesaler and finally to the retailer. That's not the case anymore. Modern container ships and
their associated loading/off-loading machinery, computerized inventory and shipping controls,
weather satellites, and advances in trucking have cut down transit times to a matter of a few
weeks from brewery to US warehouse. The Company’s close access to Miami further reduces
the time involved in this process and contributes to a fresher brand on a consistent basis.
Beers and ales from Europe in particular have benefited from these changes, with much less
chance of getting stale beer in the store. Yetman was asked why a consumer would pick Beck's
over a micro-brewed domestic beer. "I think it's because the quality is consistent. It is available
and has been available through a nationwide network of distributors that are experienced in
getting it to retailers when it’s fresh. That's been a problem for micros."
Beck's has an ace up its sleeve when it comes to freshness, a new wrinkle. Among their holdings
in Germany is a glass factory, a fairly common diversification for breweries. But Beck's glass
factory evidently has a better R&D program than most. When Beck's Light launches in four
American test markets late this year (one of them in Rhode Island) it will be bottled in clear glass
that has UV filtering capabilities.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
With hardly any support at all, Beck's Dark is the best-selling imported dark lager in America. "It
continues to grow," Yetman told me in a bemused tone of voice. "It's a brand that does well by
accident, if you will. We're pleased with it." To do that well with no support, they should be
pleased!
Another brand that does very well without much national support is St. Paul Girl. "We don't have
the big national media budget," Fred Graefenhain admitted. "We do local radio and outdoor, then
it comes down to point of purchase." Of course, they do have The Girl, which helps a lot with the
right age group of male drinkers. Between personal appearances of the latest Girl (and her very
popular posters), some very clever radio and outdoor ads that leans heavily on the highly
recognizable Girl, St. Paul managed to come in a very respectable 15 in import beer sales in
1998.
The St. Paul Girl Brauerei is also in Bremen, Germany, the same town as Beck's. The brewery
dates back to the 17th century, and is built on the foundations of the St. Paul monastery, the
origin of the name. The first half of the name, which is. The story is that the "Girl" part came
from a wandering artist who created a sign for the brewery in exchange for dinner. He painted
the classic German beer hall waitress, blonde, buxom, and smiling with cheer for her customers.
The brewery liked it so much they made it their symbol, and their name.
Unlike the other brands, St. Paul Girl as we have it is not the same as in Europe; it's not sold in
Europe. This isn't because we get a 'watered-down' version here. The St. Paul Girl sold in
America is brewed at the St. Paul Girl brewery in Bremen, it is brewed in accordance with the
famed German purity law, the Reinheitsgebot, and it is brewed to the original brewery formula.
There are legal reasons for the difference that the brewery declines to discuss.
Graefenhain did tell me that St. Paul gets to Massachusetts warehouses exceptionally quickly.
All the beer is ordered as needed and custom-brewed. "We place the orders two months in
advance, and as it comes out of the brewery the orders are shipped. By the time it gets through
customs for the East coast it's only about three weeks out of the brewery." Again, these faster
turnarounds are the result of new shipping and control technology that has greatly improved the
quality of imported beers on American shelves.
Future Growth Our results for sure see very strong buoyancy" in beers hi-end, said Labatt USA
president Simon Thorpe. Fully 1/3 of profit pool for premium (hi-end) brands worldwide is in
US, according to Simon. Meanwhile, Corona will be "staying the course," said Barton president
Bill Hackett, citing its "marketing platform" of "fun, sun and beach" as "primary driver" in longterm growth. Barton has stayed "passionately true" to this and its "disciplined approach still has
merit." Barton sales this year are reportedly up 8% thru April.
Just a few years ago, sticking a wedge of lemon in the neck of a beer bottle was unheard of.
Today, it’s so common that Corona Extra, the ubiquitous Mexican brew, has become the No. 1
imported beer in the United States. Now it seems everyone wants to tap into Corona’s success.
“When Corona was first introduced back in the 1980s, it was just one in a sea of 250 imports,”
says Bill Ligas, public relations director for Chicago-based Barton Beers, the western United
States importer of Corona and other beers brewed and bottled by Mexico’s Grupo Modelo,
including Modelo Especial, Modelo Negra and Pacifico. “Now it’s the top import and growing.”
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Heineken USA also "trending up high-single digits," President Frans Van Der Minne told analyst
recently that business is "very good and much better than last year," he added. Heineken USA is
"getting close to 80 million cases," Frans said and he hopes to hit elusive 100-mil case mark
during his tenure as president. Frans "wouldn’t be surprised" if imports climb to 15 market share
in US this year.
Diageo North America president Ivan Menezes is also bullish on imported beer. Sales have a
"very positive trends among women," he noted. Cited "growing cosmopolitan culture" in big
cities as factor in growth as well as "increased social acceptability." Over 40% of adults approve
of all alcoholic beverage ads on television compared to less than a quarter 10 years ago.
Frans expressed some concerns about industry pricing, which "might be one of the reasons"
domestic beer growth "less than expected." The pricing gap narrowed with wine, spirits.
Imported beer has a more "sophisticated" marketing focus. Frans chided beer ads with "half
naked women fighting each other in the mud" and "farting horses." He also said he is "not too
concerned" about Anheuser World Select and that AB "has other priorities."
Just as Latin beers are vying for a stake of the non-Hispanic market, domestic breweries are
going after the growing Hispanic population, whose estimated disposable income is around $580
billion, according to the University of Georgia’s Selig Center for Economic Growth.
Hispanics are the fastest-growing segment of the population and drink more beer per capita than
all other racial and ethnic groups. Nine states, including California, Texas, Florida, New York
and Illinois, account for 50 percent of beer-industry volume, according to figures from the Beer
Institute. Those states also have the largest concentration of Hispanics in the country.
Challenges Facing the Imported Beer Market While the import category is healthy and has
managed to shrug off maladies that have afflicted the rest of the industry, the future is not
without challenges. Industry consolidation among brewers and wholesalers will no doubt have
some effect on imports. And new competition from malt alternative beverages could crimp sales.
Globally, brewers continue to consolidate to boost market share, find cost savings and increase
efficiencies. Ideally, it also means smaller brands have the resources of a larger company to draw
upon to help them grow. Coors Brewing's acquisition of Carling gives it entry into foreign
markets, and eventually may give The Company another import here in addition to Molson.
Interbrew's deal with Beck's gives it another well-known trademark, and could provide Beck's
with resources to expand more aggressively.
Consolidation among wholesalers, however, is more likely to have an impact on imports,
especially smaller brands. Wholesalers and retailers may be looking at consolidating brands. All
brands grew volume last year even if they lost market share. It's in their best interest to offer a
wide selection of brands that can provide enhanced margins."
Malt alternatives, such as Smirnoff Ice and the recently launched Skyy Blue and Bacardi Silver,
will have a more immediate impact.
"There will be some trial and some trading on the shelf against beer," Hackett said, "but it's still a
malt alternative. Beer drinkers will continue to drink beer." Like microbrews, wine coolers, hard
ciders and lemonades, and even ice beers, new brands shake up the business and keep things
exciting for consumers.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
"The whole explosion of malt alternatives is part of why the industry has done so well," said
Davis. "That's what makes the industry so exciting, because there's always something going on.
But it remains to be seen if it will last more than a year or two."
Another potential challenge facing the industry is the prospect of large retailers selling their own
brands. 7-Eleven convenience stores, part of the largest such chain in the
United States will sell their own label of imported beer. They plan to undercut prices charged by
major import brands. 7-Eleven will introduce the Santiago brand beer in June, and company
spokeswoman Dana Manley said about half the 5,300 stores nationwide are expected to sell the
beer. It will be priced below well-known imports such as Corona and Heineken.
The imports, for their part, have transformed the U.S. beer industry. In a sense, the rise of
imports has spurred the internationalization of the U.S. beer industry, a development that places
U.S. brewers in competition with some very resourceful and wealthy opponents.
The 1990s saw a shift from relatively small independent importers too much larger entities. A
top-ten beer seller ranking for the U.S. industry would actually bump the smaller U.S. brewers
from the list. The pentagon of Heineken, Labatt U.S.A./Interbrew, Gambrinus, Barton and
Guinness each control about 4 million barrels. These importers have essentially become the
second tier of the U.S. brewing industry, and they are growing.
SABMiller, which owns Miller Brewing, will brew Santiago at its Cerveceria La Constancia, a
SABMiller subsidiary in the Central American nation of El Salvador. Santiago will attempt to
capitalize on the increased popularity of imported beers and ales, Manley said.
When all is said and done, imported beers and ales will still be around. After all, most of them
have weathered ups and downs for far more than 100 years.
Wine accounts for about 7.7% of total alcoholic beverage volume while distilled spirits account
for about 5.1%.
The imported wine business is booming, with some firms growing by as much as 30 percent a
year as Americans increasingly buy imported wines from abroad. The imported category "is
doing very well," said Frank Walters, director of research at Manhattan-based Impact, a trade
publication.
According to Wine Spectator Magazine wine consumption in the United States grew 6 percent in
2002, and approximately 5 percent in 2003. By 2010 wine consumption is expected to grow to
over 300 million cases annually. And it's not our parents who are accounting for the expanding
market, but rather it's the growing number of young adults who are just discovering wine who
are fueling the market growth.
The tastes of this under thirty crowds are also on the up and these young consumers instead are
turning to imported wines, which grew by 16 percent in 2003. This growth is particularly driven
by moderately-to-low-priced wines from Australia, the most popular of which are from the
Yellow Tale label, which will soon be the most popular imported wine in the U.S. and can often
be purchased on sale from Schnuck's for approximately $6. In 2003 Australian wines sales
accounted for 90.2 percent of the growth in U.S. wine sales.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Consumption of imported wines is outpacing that of domestic wines as overall U.S. wine
consumption rises, according to a study prepared by the London-based International Wine and
Spirit Record/GDR for last month's Vinexpo Americas trade show in Chicago. The study
forecast import growth to 3 billion bottles and 14% per year from 2004 through 2007, compared
with only 7.6 percent for homegrown. Imported wines account for 23 percent of all wine sold in
the United States in terms of volume and 28 percent in dollars.
While business is good, importing wine poses unique challenges. Importers spend weeks
traveling to winemaking regions, to keep up with producers, and across the United States, to sell
their wares. "We taste constantly," said Harmon Skurnik, president of Syosset-based Skurnik
Wines. "Knowing the wine is the most important thing."
The US wine industry is a highly fragmented market, with Gallo (a private company)
commanding the largest market share at 31% of California wine shipments. Robert Mondavi
Winery (MOND) is the only significant publicly traded pure wine company in the US. Major
global alcoholic beverage companies include Brown Forman, Diageo, Allied Domecq, and
Constellation Brands.
Wine is no longer only for the refined. It has become increasingly popular among those who
probably cannot even place France on a map, much less who know the difference between actual
Champagne, which comes exclusively from that region of France, and Californian sparkling
wines.
Imported Wine by Country
Imported wine sales continue to drive the overall increase in wine sales. During the few months
of this year and for the period ending April 10, 2004, sales of imported wine grew by 14.7
percent in total value. At the same time, the total volume of wine sold grew by a comparable 13
percent.
Domestic wine sales during this period experienced more modest gains of 6.4 percent in total
value. Even though this rate remains less than half that for imported wine sales, this increase in
total value for domestic wine sales is a significant gain over the sluggish or declining sales seen
for US wine in recent months.
This countervailing trend can be seen in the 52-week data for US domestic wine sales where, for
the 52 weeks ending April 10, 2004, sales of domestic wine actually declined 0.7 percent from
the same period in the previous year.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Imported Wine by Country
Country
Italy
Australia
France
Chile
Spain
Germany
Argentina
Portugal
New Zealand
South Africa
Greece
Slovenia
Canada
Israel
Romania
Hungary
Austria
Ireland
Georgia
United Kingdom
Belgium
Mexico
Moldova
Netherlands
Switzerland
Total
All Other
2003
2004
147,285
25,637
138,288
60,058
19,301
10,253
7,443
7,647
667
1,574
1,705
2,109
110
565
713
931
103
285
55
208
165
44
149
291
254
427,837
11,376
138,375
31,403
113,462
48,302
20,181
10,123
2,479
7,753
1,263
1,603
1,729
2,055
129
591
607
754
261
295
225
238
158
47
334
118
165
392,648
2,383
2005
2006
2007
2008
2009
143,237
41,038
105,379
44,771
22,797
10,857
9,138
8,115
1,907
1,928
1,846
1,707
347
649
537
515
202
334
317
726
259
651
369
105
237
397,382
1,791
157,520
56,365
107,252
52,768
19,456
13,255
11,251
8,193
3,048
2,429
1,715
1,598
112
466
588
488
258
459
224
515
161
161
125
190
987
438,653
1,513
170,126
73,465
102,867
51,841
21,376
13,088
12,287
8,511
3,438
2,612
1,595
1,275
754
432
500
676
267
440
365
257
330
841
155
311
625
467,229
1,566
195,897
111,191
108,023
50,970
26,066
14,200
11,882
9,099
4,926
3,922
1,780
1,419
454
733
612
670
439
482
388
169
488
63
262
207
135
544,467
1,573
208,825
151,424
98,960
51,058
29,547
16,969
13,926
8,422
6,337
4,745
2,044
1,292
1,181
1,088
924
674
578
483
479
326
313
240
237
182
600,391
1,380
Sources: Data on this site have been compiled from tariff and trade data from the U.S.
Department of Commerce, the U.S. Treasury, and the U.S. International Trade Commission.
High-End Wine Sales If restaurant wine sales are any indication; the U.S. economy may have
turned a corner. Sommeliers around the country report that wine sales are up, and even bottles
priced at $100 or more are increasingly being opened at their tables.
In recent years, restaurants have struggled, their business hurt by the sluggish economy, 9/11 and
the Iraq war. But times seem to be changing. Wine Spectator recently surveyed 24 wine buyers
for restaurants around the country, from New York to Dallas to Los Angeles and Seattle, as well
as for chains such as Smith & Wollensky and Ruth's Chris Steak House. In nearly every case,
buyers reported that wine sales have improved from a year ago, and most said customers are
showing renewed interest in wines priced $100 to $200 or more.
"I've been quite surprised how people are responding to high-end wines," said Christophe
Rolland, sommelier for Bastide in Los Angeles. Kevin O'Connor, sommelier for Spago Beverly
Hills, concurred: "The end of '03 and the beginning of 2004 is showing a strong turnaround." In
San Francisco, Eugenio Jardim, wine director of Jardinière, said he also senses an upswing.
Other regions are enjoying better sales as well, a trend noted by Scott Tyree at Tru and Robert
Jovic at NoMI, both in Chicago, and Charlie Arturaola at Lucca restaurant in Boca Raton, Fla.
"In the past six months to a year, we've been selling more high-end wine than ever," Jovic said.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
While statistics on restaurant wine sales are hard to come by, we asked wine buyers to compare
today's average bottle prices to those of the past few years. Most reported the average had
increased at least slightly in the past year, while only a handful reported the price had remained
the same or decreased.
Julio Hernandez, director of fine wine at Pappas Bros. Steakhouses in Dallas and Houston, said
the average in 2001 was $60 to $75 and now it’s more than $100. The current average at
Jardinière is $80 to $100, down from the heyday of the 1990s, but still an improvement from last
year, Jardim said.
Many wine buyers said customers continue to be interested in value and their restaurants are now
offering wines in a wider range of prices than ever before. That may account for why some
restaurants said customers are buying more wine overall but the average price remains flat.
Danielle Price, director of wine for the Smith & Wollensky Restaurant Group, which has 17
restaurants around the country, said wine sales are up in markets such as Las Vegas and Houston,
but New York remains a challenge.
Daniel Johnnes, wine director of Montrachet, agrees with her assessment of New York. "Sales
are good, but let's say that it's not with the same urgency and intensity as it was two or three
years ago," Johnnes said. Tim Kopec, wine director at Veritas in New York, reported strong sales
but added: "During the dot-com boom, everyone had a huge expense account and was buying
better wines, and certainly that has slowed down."
But while Johnnes waits for this national trend to roll into Manhattan, he does see a silver lining
in the current state of his high-end sales. "We no longer sell out our whole allotment of
Montrachet in a few weeks," he said, laughing. "And it's good to see people buying wine because
of a true appreciation for it and not just buying a label."
Wine Demographics A national survey of wine consumers indicate that, contrary to some
reports, younger consumers are drinking wine, and in substantial quantities. The 2003
"Scarborough Wine Market Report" reveals that 39% of U.S. adults, age 21 and older, have
purchased wine in the past three months.
The report also confirms the hunch that the wine consumer is more affluent (33% have a
household income of $75,000+) and better educated than an average American (39% have
attended some college).
Some 25% of wine purchasers are between the ages of 21 and 34 and 45% are between the ages
of 35 and 54. The ethnic make-up of wine drinkers closely mirrors the ethnic breakout of the
U.S. population, with 10% of wine consumers being African-American and 10% Hispanic.
Younger wine consumers are more apt to pay a higher price for a bottle of wine. Wine
consumers age 21-24 are twice as likely than the average purchaser to spend $20 or more on a
bottle of wine, and those age 25-34 are 76% more likely to pay for high-end wine while adults
age 65 or older are 74% less likely to pay top dollar for wine. Additionally, sparkling wine and
Champagne purchasers are 29% more likely to be between the ages of 21 and 24.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
6.1 MARKET SEGMENTATION
The Company is very much aware of the importance of market analysis as it pertains to market
segmentation. At the current time management feels that in relationship to market segmentation
the market for American Brewery Inc. & Unique Wine Imports is very large and growing. The
reason for this conclusion in reference to market segmentation is after careful study of its current
and potential customer base. The Company strongly feels that the market requires a company
that will provide excellent value to its retail clients and customers and fair reward to its founders
and employees. By offering an atmosphere through which the retail clients and consumers will
be provided with professional, personalized service that will enable them to obtain a greater
selection of quality brands, American Brewery Inc.& Unique Wine Imports should be able to
capture its market.
6.2 TARGET MARKET AND SEGMENT STRATEGY
The Company aims to understand each and every reason why a consumer buys a particular
product or service. In its total analysis there is a study of everything that affects a person’s
behavior, their cultural background, their economic status, their educational background, as well
as any and all factors that relate to their behavior. The Company also considers that people
overcome and change certain aspects of their background and as a result develop a different
behavior. The Company not only seeks to become experts on why customers buy but also what
makes them buy now. American Brewery Inc. & Unique Wine Imports strives to target that
segment of the market that is in the ideal position to need its service, afford its service, and be in
a position to act on buying its service immediately. This company is always able to determine
these results from such sources as existing customers, suppliers, bankers, trade groups, chamber
of commerce, and industry trade journals.
6.2.1 MARKET NEEDS
The Company evaluates its market primarily from the standpoint of what the needs are of the
individual consumer. This can be very complex. This company understands and appreciates what
a particular product does. This can be a very varied thing. American Brewery Inc.& Unique Wine
Imports knows that the needs of its consumers in relationship to what it offers are primarily
because it has established a strong and growing line of proprietary ownership of brands and is
poised for significant growth over the planning horizon. The Company understands that to
master this area its management team needs to constantly be tapping into those sources of
information that reveal the consumer’s true motivations.
6.2.2 MARKET TRENDS
The Company is very confident and excited about the timing of the business in its industry. It is
The Company’s position that this is the ideal time to be on the move in this ever growing market.
Evaluating different factors and events that make up a particular pattern in identifying all aspects
of that pattern secure them in an enviable position of providing what is needed in the
marketplace at this particular time. The Company is always watching the big picture and
continues to monitor any pattern or trend on a daily basis.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
6.2.3 MARKET GROWTH
The Company recognizes that it is participating in a very large industry with a great growth rate.
Its projected growth will be set at a rate greater than the industry average. American Brewery Inc.
& Unique Wine Imports implementation of its business strategy will lend itself to fast paced
development and dominance of a significant market share. The Company has determined the
growth of its market on the basis of an ever-increasing customer base, and dollar volume base as
well.
6.3 INDUSTRY & BUSINESS ANALYSIS
(PRODUCTS & SERVICES)
The Company knows that in the final analysis it can only do well if overall sales are there and
expenses are capped at a reasonable level. Its particular position in this industry is that the other
companies do some of the things correctly but not as many as it feels that it can do to become a
market leader. For example, it has found that some of the other companies have some serious
problems just providing service and require a minimum order of 10 cases. American Brewery
Inc. & Unique Wine Imports on the other hand, operates in an advantageously different manner
as outlined by offering same day service in most instances with a minimum order of only 5 cases.
6.3.1 INDUSTRY & BUSINESS PARTICIPANTS
(PRODUCTS & SERVICES)
Industry and business participants include such companies as Gold Coast Beverage, J.J. Taylor
Distributing, and WM. Thies & Sons. The primary weaknesses are that some of these other
companies have some serious problems just providing service and require a minimum order of
10 cases. American Brewery Inc. & Unique Wine Imports on the other hand, operates in an
advantageously different manner as outlined by offering same day service in most instances with
a minimum order of only 5 cases. This is how American Brewery Inc. & Unique Wine Imports
distinguishes itself.
6.3.2 DISTRIBUTING A PRODUCT & SERVICE
Because of the nature of this business The Company has learned that the best places to locate its
centers are in industrial business parks close to major highways or Interstates. This is because
there are many advantages to distributing its products in this way. Those advantages include the
fact that The Company will generate more revenue.
6.3.3 COMPETITION AND BUYING PATTERNS
The Company is excited about its position in relationship to its competition. The management of
The Company has discovered some innovative and creative ways of acquiring all the
components that make up its product line. The need for a low-based cost that transcends to a
lower net cost prior to sale and therefore transcends into a greater profit is what keeps The
Company on the cutting edge of continuously competing on a favorable basis. Such things as
inventory control, source of components, fast turnover, production schedules, all contribute to a
healthy aspect of competing with other companies.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
6.3.4 MAIN COMPETITORS
The Company recognizes the following main competitors that affect its industry. American
Brewery Inc. & Unique Wine Imports has chosen them because of their level of participation,
stability, and marketing. The main competitors are:
•
•
•
Gold Coast Beverage
J.J. Taylor Distributing
WM. Thies & Sons
7. STRATEGY AND IMPLEMENTATION
The Company centers its strategy on the premise that The Company resonates with the consumer
because the founders and owners of The Company have a combined 100 years of established
experience in the marketing, development, and distribution field. Always keeping that in mind, it
has its management constantly focus on productivity being high and of course expenses
remaining very modest. American Brewery Inc. & Unique Wine Imports is diligent in dissecting
every aspect of this business to make each component productive and contributive to the goal of
a highly profitable relationship with its customers.
7.1 STRATEGY PYRAMID
The Company knows that it’s wise to understand the framework from initial goal back to the
essential implementation. The purpose of the pyramid here is to place at the very top an
individual emphasis that is the focus of a strategy for The Company, such as introduction of a
new product line. Picture if you will, the next level down the individual actions or tactics
necessary to implement the emphasis or strategy. Finally, at the bottom of its pyramid are the
individual programs necessary to support any and all actions that contribute to achieving the
emphasis or goal. American Brewery Inc.& Unique Wine Imports wants to highlight that it is not
only adhering to its understanding of the strategy pyramid, but that it also monitors everything in
the process which leads to a logical whole plan.
7.2 VALUE PROPOSITION
The Company adheres to value-based marketing in its conceptual outlook. The value-based
benefits of The Company that it strives for consumers to acknowledge include that we have
established working relationships with other importers and distributors to market, promote, and
develop strategies pertaining to handcrafted beers and ales as well as, most recently, distinctive
imported specialty wines. In this way American Brewery Inc. & Unique Wine Imports is very
sensitive to the communication of what it is proposing to its customers as well as living up to the
promise behind what it does. The Company demonstrates that it backs up what it does with a
100% customer satisfaction attitude.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
7.3 COMPETITIVE EDGE
The Company is decisive about staying ahead of its competition. The Company knows that this
is an everyday every hour re-evaluation of what is going on in its marketplace. Its current key
advantages in relationship to competitive edge include that it offers a courteous and
knowledgeable staff of well-trained personnel dedicated to providing exceptional customer
service.
7.4 MARKETING STRATEGY
The Company is aware of all of the different choices in relationship to marketing strategy.
Because of its research and recommendations from management it has chosen to market what it
does through the Internet, industry contacts, POS advertising, and by word of mouth. It has
chosen this strategy because costs are minimal, effectiveness is extremely high and branding
recognition is enhanced.
7.4.1 POSITIONING STATEMENT
The Company takes the position that its primary focus of what it does in the marketplace is to
provide more quality at a fair price. This is how American Brewery Inc. & Unique Wine Imports
distinguishes itself in the marketplace.
7.4.2 PRICING STRATEGY
The Company has after careful consideration decided to align its pricing at a fairer level in
comparison to its competition. This fits in perfectly with where The Company sees itself
positioned in the total marketplace and communication with its customer base as far as getting
appropriate value and still maintaining sufficient motivation for high volume.
7.4.3 PROMOTION STRATEGY
The management of The Company believes very strongly in press releases to significantly get the
word out of the value of what it does. This will always be a focus of its promotion efforts.
However, though this is a crucial part, this is only one part of its promotion strategy. On a
consistent basis The Company will be promoting what it does through the Internet, industry
contacts, POS advertising, and by word of mouth.
This along with all the individual selling efforts of its staff demonstrates a dynamic way for it to
build the penetration of what it does in the marketplace.
7.4.4 DISTRIBUTION STRATEGY
The Company focuses on all three aspects of distribution concerns, that is, coverage, control and
costs. These aspects can all be complex. American Brewery Inc. & Unique Wine Imports is
certain that it has made the wisest decision in relationship to its coverage and control and cost for
its distribution strategy. The coverage and control that it’s striving for is achieved by its various
marketing programs. Its cost structure is geared to enhance its distribution based upon its
positioning in the marketplace.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
7.4.5 MARKETING PROGRAMS
The Company knows that in reference to its marketing programs it needs to tell an excellent
story. Its story is compelling, detailed and highlights many of its capabilities. The Company
knows that its consumers hear its voice loud and clear through every aspect of The Company,
staff, reputation, and quality control. American Brewery Inc. & Unique Wine Imports strives to
be indispensable to the consumer. Its marketing programs work to identify this company,
highlight competitive advantages, show appreciation for customer feedback, take advantage of
marketing resources, and demonstrate that The Company is knowledgeable, energetic, and
enthusiastic.
7.5 SALES STRATEGY
As stated earlier, The Company is currently focusing its sales strategy on the implementation of
marketing programs, which include the Internet, industry contacts, POS advertising, and by word
of mouth.
7.5.1 SALES FORECAST
The Company has developed a method for not only developing its sales forecast but also the
ability to stand behind the numbers.
Projected Sales Growth Expected
$6,000,000.00
$5,000,000.00
$4,000,000.00
$3,000,000.00
$2,000,000.00
$1,000,000.00
$0.00
2010
2010 $2,150,000.00
2012 $3,675,000.00
2011
2012
2013
2011 $2,600,000.00
2013 $5,345,000.00
The Company has determined that based on its distribution resources, competitive advantages
and sound financial analysis that it expects to do the following sales over the next 4 years: 2008:
$2,150,000.00; the year 2009: $2,600,000.00; the year 2010: $3,675,000.00; and the year 2011
$5,345,000.00.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
This Company knows full well that in order to make its business plan happen, everything has to
make sense. At American Brewery Inc. & Unique Wine Imports, The Company is grounded in
reality in making reasonable assumptions that it feels very confident it can accomplish. Its
strategies are state of the art, clear, and precise.
7.5.2 SALES PROGRAMS
The Company has sales programs that assure that its revenue forecasts are realized completely
and on schedule. The persons on its dedicated management team directly responsible for sales
performance are John Smith, Mary Smith and Joseph Smith. To make this real The Company has
set deadlines with amounts as well as budget restrictions for a highly profitable sales program.
With its comprehensive marketing program and competitive positioning, American Brewery Inc.
& Unique Wine Imports is confident in concrete terms to see its sales milestones and deadlines
become realities.
7.6 STRATEGIC ALLIANCES
The Company is constantly working to build a network of key individuals and companies that
work as alliances to accomplish its major strategies. The Company management is strongly
encouraged to develop relationships with any and all individuals that may have a favorable
relationship with any of its working teams. These alliances are to strengthen and broaden the
foundation of The Company and the assurance that its market share and profitability will
continually increase.
7.7 EXPLAINED MILESTONES
The Company is very pleased with the accomplishments of the retail clients, customers,
personnel and participants. The Company is very proud of its loyal wonderful personnel
dedication to reach all forecasts and milestones on which the personnel set its course. The
company is presently focusing its efforts in the State of Michigan but future expansion plans are
to open the markets in the Southeastern States and eventually to include coverage in 40 states
within the next 3 to 7 years. We will be targeting specific demographics in age category that
appreciate premium specialty beers, ales and selective imported wines.
8. MANAGEMENT SUMMARY
Management is the core and nucleus of any organization. It’s not just personnel and individuals’
resumes but so much more that encompasses vision, talent, harmony, beliefs, and commitment.
John Smith, Mary Smith and Joseph Smith lead the Company. The key players of the
management team provide all the talent necessary to complete every aspect of this business plan.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
8.1 ORGANIZATIONAL STRUCTURE
The Company knows how important the organizational structure is to the success of a company.
Each position with this company has a detailed job description as well as a defined relationship
to the whole. At the very head of The Company is John Smith. That position holds the title of
President & CEO. The other key executives and their positions are Mary Smith, Secretary
Treasurer/ Vice President and Joseph Smith, General Sales Territorial Manager. From other
management positions to department heads, to first line implementation staffs, the structure of
the organization is detailed and complete. Authority is properly positioned to achieve maximum
effectiveness of each organizational structure.
8.2 MANAGEMENT TEAM
What follow are the top positions of American Brewery Inc. & Unique Wine Imports, their
names and a brief description of their duties and responsibilities as it pertains to the successful
management and development of this company’s goals.
 John Smith, President & CEO
John is responsible for providing leadership, direction, and control of all aspects of marketing,
development and the coordination of sales in order to ensure that the Company and the divisions
meet their short and long-term goals. John has been a pioneer for the past 30 years in the
Marketing and Development of a wide array of consumer-oriented products. His most recent
undertaking has been in the alcohol beverage industry. He has been deeply involved in the
distribution and sales aspect for most of his life.
 Mary Smith, Secretary-Treasurer/Vice President
Mary is an asset to the business and is responsible for planning the tasting schedules, undertaking
certain events, handling account payable as well as receivable, banking and management,
ensuring that state reporting requirements are met, and that office procedures and policies are in
compliance. She has served in an administrative and managerial capacity for over 25 years.
 Joseph Smith, General Sales Territorial Manager
Joseph Smith has served as a seasoned sales and marketing manager for over 45 years. Robert
has been in the alcohol beverage industry for the past 10 years. During this time, Robert became
skilled at the inner workings of the industry and in distribution throughout the State of Michigan.
8.3 MANAGEMENT TEAM GAPS
The Company recognizes that in any growing company often times management personnel have
to wear more than one hat. As a result often times a gap or gaps may exist until The Company is
developed enough to have a specific person for every task required. American Brewery Inc. &
Unique Wine Imports currently has everything covered and feels very confident that each task is
assigned to a very competent member of its management team.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
The Company will always be sensitive to this issue and prevent any weakness by having and
planning a contingency program that overlaps job responsibilities.
8.4 PERSONNEL PLAN
The Company defines its total work force to protect the success of its business plan. All aspects
of the business have been sufficiently analyzed to determine each and every position required to
run a fully functioning operation that can complete all of the strategies and programs to be
undertaken.
Personnel Optimization
American Brewery Inc.& Unique Wine Imports
Total In
Individual
Compensation
Category Compensation
Total
Category
Administrative
President & CEO
Secretary-Treasurer/Vice President
General Sales Territorial Manager
Combined Totals
1
1
1
3
80,000.00
45,000.00
35,000.00
135,000.00
95,000.00
50,000.00
40,000.00
155,000.00
9. FINANCIAL PLAN
The Company has developed its financial plan with the awareness that cash and the bottom line
are key components of any successful company. Revenues for The Company will come from
sales and fees generated from operating an alcohol beverage import and distribution company.
The opportunity to increase revenues is being fully taken advantage of as outlined in its overall
marketing strategy. To assure that bottom line adequately follows increases in revenue every
cure possible is being taken to control all areas of expenses and overhead. The basis of its
financial plan is solid growth, increase in revenues, and controlled expenses.
9.1 IMPORTANT ASSUMPTIONS
The Company makes every effort not to assume any aspect of its operation other than having
hard factual data to back up any forecast. The entire management team is constantly reminded to
base all programs on highly researched statistical information with the slightest possible margin
of variation. One of the reasons that the leadership of American Brewery Inc. & Unique Wine
Imports chose the industry that it is in was to minimize as many variables in the business
community as possible.
9.2 KEY FINANCIAL INDICATORS
The Company recognizes that the most important financial indicators are cash and bottom line.
This company will be constantly monitoring the flow of revenue to The Company as well as the
expense requirements that deplete The Company of its cash. American Brewery Inc. & Unique
Wine Imports will always try to improve the ratio of revenue and expenses to generate a healthier
bottom line in addition to a more healthy cash base.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
9.3 EXPLANATION OF BREAK-EVEN ANALYSIS
The break-even analysis for this company calculates at what point The Company becomes
profitable, and also at what point The Company will be operating at a loss.
Monthly Sales Amount Needed To Break Even
$1,000,000.00
$100,000.00
$10,000.00
$1,000.00
$100.00
$10.00
$1.00
Start
Break Even Mo. Sales Gross Proj. Mo. Sales
$114,039.06
$179,166.66
Break Even Analysis
The analysis takes into consideration forecasted revenues as well as regular running fixed costs
and average per unit sales price also known as per unit revenue. For simplicity the average per
unit sales price is adjusted to $1 and the regular running fixed cost are represented as a
percentage of that dollar. The purpose of this analysis is to maintain insight on financial realities.
This information is vital for all kinds of things, from deciding how to price products or service to
figuring whether a marketing program is worth the investment. The break-even point for this
company occurs when gross sales in any given month = $114,039.06. Formula: (Gross Profit
$1,893,000.00 / Gross Sales $2,150,000.00) = 88.04%. Total Expenses $1,204,800.00 / 88.04%
as a decimal .8804 = $1,368,468.80 / 12 = $114,039.06 (Break even amount monthly).
9.4 EXPLAINED PROJECTED PROFIT AND LOSS
The Company sales are forecasted to be increasing on a regular basis. Gross margin is also
expected to increase on a regular basis. Breaking down the profit and loss projections and
monitoring them on a regular basis is essential to the foundation of The Company.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
9.5 EXPLAINED PROJECTED CASH FLOW
As stated earlier, The Company will focus its attention on bottom line and cash. Its projected
cash flow is very positive. With forecasted increasing revenues and controls on overhead and
expenses it will look to see an increasing bottom line as well as increasing cash.
9.6 EXPLAINED PROJECTED BALANCE SHEET
The projected balance sheet for The Company highlights total assets, total liabilities, as well as
capital. With projected cash flow already established The Company balance sheet exemplifies a
company whose revenues are increasing as well as its bottom line in cash. The leadership of this
company offers its financials as proof positive of the workings of this business plan.
9.7 BUSINESS RATIOS
Equipped with income figures, a balance sheet, and a cash flow statement The Company can
present a complete financial picture of American Brewery Inc. & Unique Wine Imports. To
clarify and spotlight its financials it presents the following ratios and illustrates an accurate
picture with all things having been considered. The first ratio is the current ratio = current assets
$293,637.00 divided by current liabilities $98,923.00. The CURRENT RATIO is 296.83%. The
second ratio is the quick ratio = (cash $106,475.00 + investments $0.00 + receivables $4,185.00)
divided by current liabilities $98,923.00. The QUICK RATIO is 111.86%. The net profit margin
= net profit $688,200.00 divided by gross revenue on sales $2,150,000.00. The NET PROFIT
MARGIN RATIO is 32.001%. The return on investment = net profit $688,200.00 divided by
total assets $348,917.00. The RETURN ON INVESTMENT RATIO or ROI is 197.24%.
9.8 EXPLAINED LONG-TERM PLANS
The Company believes that its long-term prospects for a very successful company are excellent.
The industry chosen and the strong foundation of The Company lend itself to nothing but
positive results in the long-term future. With a market sensitive management team and excellent
systems in place to monitor competitive shifts or changes American Brewery Inc. & Unique
Wine Imports is ideally positioned to continue its successful plan on through the next decade.
10. WEB PLAN SUMMARY
The Company observes the increasing importance of the Internet in all that the worldwide web
encompasses. This company not only is a participant in the worldwide web but also with its
management team will continually strive to have a competitive edge by a significant presence
and plans for exposure on the worldwide web. Because of the ever-increasing sophistication of
the American Consumer and the ever-increasing participation on the Internet by the American
Consumer, American Brewery Inc. & Unique Wine Imports will apply all of its resources to be
the industry leader in utilization of the Internet and its commerce.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
10.1 WEB MARKETING STRATEGY
The Company recognizes that there are many parts to a company success and its involvement in
the Internet. The first part is a fully functioning presentable web site that resonates with the retail
client, consumer and the personnel of The Company. To that end, the management team has
assigned the evolving development and maintenance of the web site for American Brewery Inc.
& Unique Wine Imports. The second part is a concerted program of search engine optimization
to assure that penetration of the marketplace is vast and consistent. Association of company
identity and web site presence shall be an integral part of all company promotional activities and
materials. The third part is to utilize The Company web site in all aspects of sales to retail clients,
processing and customer service. The fourth part is to utilize all capabilities on the worldwide
web for The Company and procedures. In the future as video conferencing and other
technologies become commonplace and developed for the worldwide web, The Company shall
be among the first to participate.
10.2 DEVELOPMENT REQUIREMENTS
The Company sees that the expertise of someone involved with the worldwide web is very
specific. The management team is committed to providing ongoing training for those members of
The Company directly associated with the development of its website, the implementation of
search engine optimization, and the adaptability for customer service and other procedures
utilizing the world-wide web. In addition to ongoing training, The Company will commit an
appropriate amount of company resources sensitive to revenues generated by the web site
presence. In addition, as it relates to productivity personnel will have access to computer
capabilities that tie in the web presence with all of its internal company workings. The
development of these programs will be the direct responsibility of an assigned person from its
management team.
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Balance Sheet
American Brewery
Category
2010
2011
2012
2013
2014
Assets
Current Assets:
Cash
$106,475.00
$206,475.00
$306,475.00
$406,475.00
$506,475.00
$4,185.00
$4,185.00
$4,185.00
$4,185.00
$4,185.00
$185,129.00
$185,129.00
$185,129.00
$185,129.00
$185,129.00
Investment Portfolio
$0.00
$0.00
$0.00
$0.00
$0.00
Other
$0.00
$0.00
$0.00
$0.00
$0.00
$293,637.00
$393,637.00
$493,637.00
$593,637.00
$693,637.00
$0.00
$0.00
$0.00
$0.00
$0.00
Accounts Receivable
Inventories
Total Current Assets:
Fixed Assets:
Land
Buildings
$0.00
$0.00
$0.00
$0.00
$0.00
Equipment
$45,980.00
$45,980.00
$45,980.00
$45,980.00
$45,980.00
Machinery
$0.00
$0.00
$0.00
$0.00
$0.00
Other (Promotional Material)
$5,500.00
$5,500.00
$5,500.00
$5,500.00
$5,500.00
Other (Deposit)
$3,800.00
$3,800.00
$3,800.00
$3,800.00
$3,800.00
$55,280.00
$55,280.00
$55,280.00
$55,280.00
$55,280.00
Goodwill
$150,000.00
$150,000.00
$150,000.00
$150,000.00
$150,000.00
Copyrights
$190,000.00
$190,000.00
$190,000.00
$190,000.00
$190,000.00
Total Fixed Assets:
Intangibles
Patents
$0.00
$0.00
$0.00
$0.00
$0.00
$340,000.00
$348,917.00
$340,000.00
$448,917.00
$340,000.00
$548,917.00
$340,000.00
$648,917.00
$340,000.00
$748,917.00
Accounts Payable
$78,923.00
$78,923.00
$78,923.00
$78,923.00
$78,923.00
Short-term Notes Payable
$20,000.00
$20,000.00
$20,000.00
$20,000.00
$20,000.00
Total Intangibles
Tot. Curr., Fixed and Int. Assets
Liabilities
Current Liabilities:
Other
$0.00
$0.00
$0.00
$0.00
$0.00
$98,923.00
$98,923.00
$98,923.00
$98,923.00
$98,923.00
$173,500.00
$173,500.00
$173,500.00
$173,500.00
$173,500.00
Balloon Payments Due
$0.00
$0.00
$0.00
$0.00
$0.00
Other
$0.00
$0.00
$0.00
$0.00
$0.00
$173,500.00
$272,423.00
$173,500.00
$272,423.00
$173,500.00
$272,423.00
$173,500.00
$272,423.00
$173,500.00
$272,423.00
$76,494.00
$176,494.00
$276,494.00
$376,494.00
$476,494.00
Total Current Liabilities
Long Term Liabilities:
Notes Payable
Total Long Term Liabilities
Tot. Curr. and Long Term Liabilities
Net Worth = Assets- Liabilities
________________________________________________________________________
American Brewery Inc.
Strategic & Tactical Business Plan___________________________________________
Profit & Loss Statement
American Brewery
Revenue Sources
Beer Revenue Source #1
Wine Revenue Source #2
Promotional Material Revenue Source #3
Freight & Shipping Revenue Source #4
Net Sales
Cost Of Sales (Costs outside below.)
Gross Profit
2010
2011
2012
2013
$2,150.000.00
$1,000.000.00
$3,500.00
$1,500.00
$3,155.000.00
$1,262,000.00
$1,893,000.00
$2,600.000.00
$1,200.000.00
$3,800.00
$1,800.00
$3,805.600.00
$1,522,240.00
$2,283,360.00
$3,675.000.00
$2,250,000.00
$4,500.00
$2,500.00
$5,932,000.00
$2,372,800.00
$3,559,200.00
$5,345.000.00
$3,750.000.00
$5,500.00
$3,000.00
$9,103.500.00
$3,641,400.00
$5,462,100.00
$350,000.00
$90,000.00
$50,000.00
$12,000.00
$2,000.00
$25,000.00
$5,000.00
$4,000.00
$3,000.00
$10,000.00
$7,200.00
$25,000.00
$3,000.00
$600.00
$586,800.00
$385,000.00
$99,000.00
$60,000.00
$13,200.00
$3,000.00
$27,500.00
$5,000.00
$4,400.00
$3,000.00
$11,000.00
$7,920.00
$27,500.00
$3,500.00
$600.00
$650,620.00
$424,000.00
$109,000.00
$90,000.00
$14,820.00
$4,000.00
$30,250.00
$8,000.00
$4,840,00
$3,000.00
$12,000.00
$8,712.00
$30,250.00
$4,000.00
$800.00
$743,672.00
$475,000.00
$125,000.00
$136,500.00
$15,972.00
$5,000.00
$33,275.00
$10,000.00
$5,324.00
$3,000.00
$13,310.00
$9,583.00
$33,275.00
$5,000.00
$800.00
$871,039.00
$200,000.00
$120,000.00
$30,000.00
$25,000.00
$60,000.00
$12,000.00
$24,000.00
$35,000.00
$2,500.00
$25,000.00
$15,000.00
$20,000.00
$30,000.00
$10,000.00
$6,000.00
$3,500.00
$618,000.00
$1,204,800.00
$200,000.00
$120,000.00
$30,000.00
$25,000.00
$60,000.00
$12,000.00
$24,000.00
$35,000.00
$2,500.00
$25,000.00
$15,000.00
$20,000.00
$30,000.00
$10,000.00
$6,000.00
$3,500.00
$618,000.00
$1,268,620.00
$200,000.00
$120,000.00
$30,000.00
$25,000.00
$60,000.00
$12,000.00
$24,000.00
$35,000.00
$2,500.00
$25,000.00
$15,000.00
$20,000.00
$30,000.00
$10,000.00
$6,000.00
$3,500.00
$618,000.00
$1,361,672.00
$200,000.00
$120,000.00
$30,000.00
$25,000.00
$60,000.00
$12,000.00
$24,000.00
$35,000.00
$2,500.00
$25,000.00
$15,000.00
$20,000.00
$30,000.00
$10,000.00
$6,000.00
$3,500.00
$618,000.00
$1,489,039.00
$688,200.00
$0.00
$688,200.00
$0.00
$688,200.00
$1,014,740.00
$0.00
$1,014,740.00
$0.00
$1,014,740.00
$2,197,528.00
$0.00
$2,197,528.00
$0.00
$2,197,528.00
$3,973,061.00
$0.00
$3,973,061.00
$0.00
$3,973,061.00
Operating Expenses
Sales Expenses:
Sales & Marketing Salaries
Employee Benefits
Advertising
Public Relation
Email Promotion
Tradeshows
Marketing Consulting
Displays & Signage
Design
Catalogs/ Printing/ Brochures
Shipping & Handling
Employee Traveling Exp
Marketing Materials
Website Hosting
Total Sales Expenses
Administrative & General Expenses:
General Administration Salaries
Admin & Office
Payroll Taxes Benefits
Professional Fees
Warehouse Rent
Telephone & Cellular
Electricity & Utilities
Insurance Expenses
State Permits & Licenses
Professional Services - Legal
Professional Services - Accounting
Warehouse & Office Supplies
Fuel & Maintenance Charges
Repairs & Maintenance Expenses
Janitorial Supplies
Income Taxes Expenses
Total Admin. & General Expenses
Total Operating Expenses
Profits Or (Losses)
Operating Profit or (Loss)
Adj. For Any Other Income (Int. Inc., etc.)
Net Income or (Loss) Before Taxes
Income Taxes
Net Income or (Loss) After Taxes
________________________________________________________________________
American Brewery Inc.