Recommended
Recommended
More Related Content
What's hot
What's hot (20)
Similar to Mountain Man Brewing Company
Similar to Mountain Man Brewing Company (12)
Recently uploaded
Recently uploaded (20)
Mountain Man Brewing Company
- 3. COMPANY HISTORY • Founded in 1925 by Guntar Prangel • Mountain Man brewed one beer ‘Mountain Man Lager’ which also came to be known as West Virginia ‘s Beer • By 1960s it was established as a quality brew in the East Central region of United States • It was priced similar to premium domestic brands and below specialty brands •
- 4. KEY PLAYERS • Oscar Prangel – President and owner, MMBC • Chris Prangel – Recent MBA graduate, stood to inherit MMBC in 5 years
- 5. CORE ATTRIBUTES • Authenticity • Quality • Unique West Virginia’s toughness Mountain man Lager has always been perceived as Strong and Working man’s beer
- 6. MOUNTAIN MAN LAGER • Dark beer • Premium segment • 5,20,000 barrels sold in 2005 • Revenue of 50 million in 2005 • Popular among blue collared workers
- 8. DEMOGRAPHICS
- 9. As per analysis of Demographics the brand was
- 10. Female Drinkers
- 11. Young Drinkers
- 12. PRESENT SITUATION • 2% decline in revenue for the first time • Growing light beer market • Key consumer segment – young drinkers,21-27 years of age
- 13. ALTERNATIVES FOR SOLUTION • Continue selling Mountain Man Lager • Introduce Mountain Man Light • Introduce a light beer under a different brand name
- 14. INCOME STATEMENT
- 16. Chris’s projections • 2% annual revenue base loss for Mountain man lager • 4% annual regional growth of light beer • 0.25% increase in market share of regional light beer • 0.25% base market share in 2005
- 17. FINANCIAL ANALYSIS • Cost / barrel of Mountain man lager = $66.93 • Cost / barrel of Mountain man light = $ ( 66.93 + 4 ) = 71.62 • Market Price/ barrel = $ 97 ( Total revenue / no of barrels ) [ Exhibit 1 ]
- 18. • Advertising costs = $ 7,50,000 ( 6 Months ) • Incremental SG & A costs = $ 9,00,000 • Break even barrels = Fixed costs / contribution per barrel = (7,50,000 + 9,00,000) / (97- 71.62 ) = 65,012 barrels
- 20. PROJECTIONS YEAR TOTAL LIGHT BEER SALES MOUNTAIN MAN’S SHARE MOUNTAIN BEER SALES 2005 1,87,44,303 - NIL 2006 1,94,94,075 0.25% 48,735 2007 2,02,73, 0.50% 1,01,369
- 21. CANNIBALIZATION • Cannibalization in Mountain man Lager sales are from 2%-20%. • Taking an average of 10%. The loss in sales would be $1,563,640 • Mountain man Light Barrels required to offset the loss in revenue of Mountain man Lager = $1,563,640/ $97 =61,609
- 22. BREAK EVEN • Number of barrels of Mountain man light to be sold to break even = 65012 + 61,609 = 126621 • Sales for Mountain Man Light in two years = (48,735 + 101,369 ) = 150,104 barrels • Thus the break even is reached in two years itself
- 23. CONCLUSION • THE BRAND CAN GO FORWARD WITH THEIR DECISION OF INTRODUCING MOUNTAIN MAN LIGHT BEER AND DIVERSIFY THEIR PRODUCT LINE.
- 24. DISCLAIMER • This presentation has been prepared by Shreyansi Rohatgi , a commerce graduate in the course of an internship under Professor Sameer Mathur