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Mountain Man Brewing

Essay by   •  July 25, 2012  •  Essay  •  438 Words (2 Pages)  •  1,522 Views

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I. Competitive Advantage

Mountain Man has a born legacy from its founding father in 1925. Using a unique old family brew recipe, Mountain Man Lager was launched and grew in reputation throughout the Eastern cost as a quality beer. MMBC relied heavily on its authentic history as a family owned brewery to position itself to the blue-collar, middle to lower income men over 45 based on data in Exhibit 2. This demographic not only choses the lager because of its distinctive bitter flavor and higher alcohol content, it is spurned by a family tradition that also enjoyed the beer going back a couple of generations. MMBC made a critical decision to separate from distributors that worked with their competitors. It created its own sales force and targeting off-premise locations (supermarket, liquor stores) embracing its 70 % total revenues. This tactic was effective as it attracted the blue-collar demographic. This singlehandedly pushed MMBC to not only create a strong well known brand, but also sustain itself amongst the major competition.

II. Market Situation

MMBC is solely in the lager market and with premium beer sales has decreased at a compound annual rate of 4% while the light beer category has gone up 4% has caused a decline in sales. In recent years not only does MMBC have to compete against other beer products, but consumption has fallen due to the rise in spirits and wine consumption (beer consumption decrease of 2.3%). With repealing of the arcane law in the eastern region, retail offered deep discounts. Distributors in turn would continue to carry the brands that had good margins and turnover thereby not only threatening MMBC, but also hampering the craft brewery industry. Along those lines, MMBC had to compete with competitors that offered light beer, a brand extension that MMBC did not yet enter. In terms of beer MMBC, based on exhibit 3 had to compete against major domestic producers that had mass scale production and advertising dominated by the big three Anheuser-Busch, Miller, Coors comprising 74% of beer shipments in the East Region. Amongst the second tier producers, despite following similar methodology as the major producers, was capped by financial limits but still accounted for 12% of shipments. The imported beer producers also left a mark with 12 % of beer shipments but was a struggling entity due to the low demand and the high costs of export and shipment. Independent brewers only took up the last 1.5 % of shipments. Mountain Man beer has survived because of its appeal to the customer base mentioned earlier and its brand equity.

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