Competition in the Craft Beer Industry in 2018
Question 1
Competition in the craft beer industry is surrounded by many external factors, including the legal laws that govern how the business market is running. Sales and distribution of brews need close attention to control the amount of alcoholic beverage supply. The number of taprooms within a particular geographic region and the number of growlers and bottles supplied within a particular geographic area has to be closely monitored. In the economic environment, the beer market has a very significant impact on the economy, considering that in 2016 it summed up to2.0 percent of the economy U.S.GDP considering the number of jobs surrounding the beer production industry and sales and distribution.
Question 2
In the craft beer industry, there was a dramatic change in the early 2010s from the sale of well known brands like Budweiser and millers, among others, to the sale of craft beer. Since then, there has been a continuous rise in the popularity of the market. Due to high demand, the volume of craft beer production even had a 5 percent rise in 2017. The preference for unique and top quality beers by customers also led to the growth of the craft beer industry.
The most effective of the competitive forces, however, is the bargaining power of the suppliers since it affects the price and quality of a commodity. Customers are majorly after price and quality. The least, however, is the threat of new entrants in the market. Most companies that are already established tend to have loyal customers, and mos beer drinking customers prefer brands from highly rated companies to new entrants. Competitive rivalry, on the other hand, has the most significant effect on attractiveness in the industry.
Question 3
The strategic group map consists of a brewpub, taproom brewery, alternating proprietor, contract brewing company, and regional brewery. The brewpub is a restaurant brewery and is in the best positions. They sell up to 25 percent of the beer they produce and are open to food services. The alternating proprietor is in the worst places.
Question 4
The availability of capital could quickly boost up the craft brewery. With adequate capital, craft industries could efficiently market their products and produce enough for their customers.
Question 5
Onsite sales could act as a way of improving competitiveness for the smaller craft breweries. This would help them addon savings and make improvements to counter any current or future risk.
Question 6
The major strategic issue that affects the craft industry, however, is marketing its product. Since they have to have tours and tastings, which is a privilege to the upcoming industries, this cripples future industries reducing competition.