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Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson
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Boston Beer Company Operations Presentation by Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson

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This presentation explores the operations of Boston Beer Company, known for manufacturing the Samuel Adams Boston Lager. Credit goes to Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy …

This presentation explores the operations of Boston Beer Company, known for manufacturing the Samuel Adams Boston Lager. Credit goes to Vinh-Khoi Le, Daniel Tonkovich, Amanda Yam, and Timothy Peterson.


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  • Produces 22 kegs per dayIf operate 260 days a years, effective capacity is 5,720 kegs per yaerCapable of making 50 kegs per year, but only 22 kegs Utilization rate of 44% yearly Bottleneck is the number of tanks at each facility Takes at least two weeks to complete, so the number of tanks determines how much can be processed. Each fermentation tank holds more than 2,400 gallons With 3 tanks, about 7,200 gallons processed at one time Demand variability by outsourcing to company-owed breweries or third parties Pennsylvania and Ohio handle an excess of 10% Arrangement with other third parties; safety stock Bought out Pennsylvania location to control demand
  • Internal MeasuresFlow rate – 960 gallons per week or 137.1 gallons per day Flow Time – 7.5 weeks or 52.5 days Value of inventory held was $26,614,000On-site control labs and 14 brew mastersCustomer-focused measurements Freshest beer program; bought back .5% of the beer so about 99.5% good Freshness code on every bottle and kegJim Koch tastes it Financial Measurements Net reveneue was $463,798,000 and Net Income was about $50 million, an increase of $19 million Inventories and Provisiosn for Excess or Expried inventories not recorded.
  • Customer-focused measurements Freshest beer program; bought back .5% of the beer so about 99.5% good Freshness code on every bottle and kegJim Koch tastes it Financial Measurements Net reveneue was $463,798,000 and Net Income was about $50 million, an increase of $19 million Inventories and Provisiosn for Excess or Expried inventories not recorded.
  • Transcript

    • 1. Boston Beer Company By: Vinh-Khoi Le, Tim Peterson, Daniel Tonkovich, and Amanda Yam
    • 2.  Inputs:  Cash needed to acquire the raw materials  The raw materials  Malt  Hops  Yeast  Water  Spices  The labor hours required in production Inputs and Outputs
    • 3. Inputs and Outputs (Cont.)  The equipment used in production  Gristmill  Mash Vessel  Lauter Turn  Whirlpool Vessel  Fermentation Vessel  “Bright Beer” Tank  Bottling Machine  Output: Samuel Adams Boston Lager
    • 4. Transmission of Information  Information regarding the characteristics of the beer are obtained via direct sampling throughout the brewing process and recorded in a database.
    • 5. The Process  The process of making Samuel Adams Boston Lager is considered a batch
    • 6. The Process (Cont.)
    • 7. The Process (Cont.)
    • 8. Supply Chain  The supply chain is efficient because it is aimed at managing the delivery and usage of the raw materials used in Boston Lager.  External Members of Supply Chain:  Malts - purchased from one supplier  Hops - purchased through four dealers  Water - received via the tap from the city of Boston  Packaging - multiple outside sources  Glass bottle and labels - only one outside vendor
    • 9. Supply Chain (Cont.)  Internal Customers  The quality control department  The bottling department  The Final link in the supply chain is the delivery of the finished Boston Lager to distributors and customers
    • 10. Corporate Social Responsibility  Samuel Adams “Brewing the American Dream”  Launched in 2008  Help low income, small business owners through loans and mentoring programs  Sustainability Initiatives  Increased usage of recycled materials in their packaging  Encouraging consumers to recycle their bottles in advertising campaigns
    • 11. Operations Strategy  Second largest US beer maker  Approximately 1% of the domestic market by sales volume  “Better Beer”  Craft brewers, specialty beers and most imports  Higher price, quality, image and taste
    • 12. Operations Strategy  Increased attention to the brewing process and the selection of raw material inputs  Higher production costs  Hand-selected hops  In-house brewing  Tasting and Quality Control  Strong reputation with the craft beer industry  Premium to be charged for its products.
    • 13. Freshest Beer Program  Freshness Tag  Buy back expired code  Reduced time and temperature the Company’s beers experience at wholesaler warehouses  Forecasting, production planning and cooperation with the wholesalers
    • 14. Demand Forecasting  Demand has increased 5% to 7%  Freshest Beer Program  Managing relations with 400 independent beer distributors  Seasonal beers  Twelve year-round varieties  Four seasonal beers  Accommodate fluctuations with seasonal demand and taste
    • 15. Capacity Management  Effective capacity: 5,720 kegs per day  Utilization rate: 44%  Process about 7,200 gallons at one time  Agreements with Third Parties if Demand Increases  Expand Pennsylvania and Ohio Facilities
    • 16. Raw Material Inventory  External:  Two-Row Malted Barley  Reservoir Tap Water  Internal:  Bavarian Hops  Bottom-Feeding Yeast  Safety Stock?  Sharing program w/ local breweries  Some in handy
    • 17. Work-In-Process Inventory  Unfinished “Juice”:  Brewing  Fermentation  Lagering  Finishing  Packaging materials  Distribute finished inventory to partners
    • 18. Quality  User-Based & Process-Based  Reliable Brand  Consistent Tastes & Textures  Testing & sampling of material (raw & WIP) before and during main stages of process.  Inspection: Buyback Program  Out-of-code  Bacterial infection  TQM??
    • 19. Assessing Process Performance  Internal Measurements  Flow Time = 7.5 weeks or 52.5 days  Flow Rate = 960 gallons per week or 137.1 gallons per day  About $26 million of Inventory  On-site Control Labs and 14 Brewmasters
    • 20. Assessing Process Performance (Cont.)  Customer-Focused Measurements  Freshest Beer Program  Only .5% of the Beer Bought Back  Financial Measurements  Net Income Increased $19 million  No Inventories and Provisions for Excess or Expired Inventories
    • 21. Recommendations  Successful in Quality, but not at Full Capacity  Continue to Reduce Buy-Back Quantity  Reduce Amount of Excess Inventory to Distributors to Increase Freshness  Improve Inspection Efficiency
    • 22. Questions?

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