Written Assignment 3
Student ID 39113837
RedHook Ale Brewery, Case Analysis
Redhook Ale Brewery, Incorporated engages in brewing, marketing, and selling craft beers in the United States. It produces nine types of beers, which are marketed under the brand names Redhook Long Hammer IPA, Redhook Blonde Ale, Blackhook Porter, Nut Brown, Sunrye, Late Harvest Autumn, Winterhook, and Copperhook Ales. The company also sells Widmer Hefeweizen, a golden unfiltered wheat beer, in the Midwest and eastern United States. It distributes its products through joint venture and distribution agreements. The company was founded in 1981 and is based in Woodinville, ...view middle of the document...
This is accomplished primarily through personal contact with each distributor, including on-site sales training, educational tours of the Company’s breweries, and promotional activities and expenditures shared with the distributors.
The Company’s breweries also play a significant role in increasing consumer awareness of the Company’s products and enhancing Redhook’s image as a craft brewer. Many visitors take tours at the Company’s breweries. Both of the Company’s breweries have a retail pub on-site where the Company’s products are served.
Critical Success Factors
The Company is a brewer in the relatively small craft brewing segment of the U.S. brewing industry. The domestic beer market is comprised of ales and lagers produced by large domestic brewers, international brewers and craft brewers. Annual per capita domestic beer consumption has declined from the highs experienced in the early 1980s, a result of an elevated concern over health and safety issues, changing tastes, and evolving affluence and consumption attitudes of a maturing generation of beer drinkers born after World War II. Since the early 1980s, a sizable number of consumers have migrated away from the major domestic products toward a broader taste and variety in their malt beverages, mirroring similar trends in other beverage and cuisine categories. Foreign brewers initially benefited from these evolving consumption patterns. Despite also being produced by large brewers, European, Canadian and Mexican imported beers offered a fuller-flavored alternative to the national brands produced in the U.S.
The strength of consumer demand has enabled certain craft brewers, such as the Company, to evolve from microbreweries into regional and national specialty brewers by constructing larger breweries while still adhering to the traditional European brewing methods that typically characterize the craft brewing segment. Industry sources estimate that craft beer produced by regional specialty brewers, such as the Company, accounts for approximately two thirds of total craft beer sales. Other craft brewers have sought to take advantage of growing consumer demand and excess industry capacity, when available, by contract brewing at underutilized facilities.
Trends, Issues, and Forces
Since its formation in the 1980s, the...