FINAL PAPER THBC

Terre Haute Brewing Company
Sycamore Student Ventures
November 30, 2015

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Recommendation Report
Prepared by: Joseph Banfield (Project Leader), Bradley
Ackman, Jimmy Charles, Ashley Borhart, Allyssa Bennett,
Jasmine Gardner, Evan Fleschner, Kyle Bollero, Kathryn
Cowen, Madison Flynn.
Prepared for: Jeffrey Hock and the Terre Haute Brewing
Company
Report Distributed November 30, 2015
Table of Contents

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Executive Summary…………………………………………………………………………………………………………………………..5
Directional Analysis…………………………………………………………………………………………………………………………..6
StakeholderAnalysis…………………………………………………………………………………………………………………………6
Figure 1………………………………………………………………………………………………………………………………..7
BusinessModel…………………………………………………………………………………………………………………………………9
DefiningValue…………………………………………………………………………………………………………………………………..9
DeliveringValue………………………………………………………………………………………………………………………………..10
Capturing Value…………………………………………………………………………………………………………………………………11
External Analysis……………………………………………………………………………………………………………………………….11
Opportunities……………………………………………………………………………………………………………………….12
Figure 2………………………………………………………………………………………………………………………………..13
Threats.………………………………………………………………………………………………………………………………..14
Internal Analysis……………………………………………………………………………………………………………………………….15
Strengths……………………………………………………………………………………………………………………………..15
Figure 3………………………………………………………………………………………………………………………………..16
Weaknesses…………………………………………………………………………………………………………………………18
Figure 4………………………………………………………………………………………………………………………………..19
ModifiedSWOT………………………………………………………………………………………………………………………………..19
Figure 5………………………………………………………………………………………………………………………………..20
GAPAnalysis…………………………………………………………………………………………………………………………………….20
Marketing & Brand Awareness…………………………………………………………………………………………….21
Figure 6…………………………………………………………………………………………….………………………………...21
Pricing…………………………………………………………………………………………….……………………………………22
DiversifiedOptions…………………………………………………………………………………………….………………..23
Banquet Hall Use………………………………………………………………………………………………………………….23
Figure 7 & 8…………………………………………………………………………………………….……………………………25
Bottling & Capping……………………………………………………………………………………………………………….26
Summary of Findings………………………………………………………………………………………………………………………28
Appendix…………………………………………………………………………………………………………………………………..29-48

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Works Cited………………………………………………………………………………………………………………………………49-50
Executive Summary

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This report provides an analysis and evaluation of the craft beer industry and strategic
analysis into Terre Haute Brewing Company. Methods of data collection included expert
opinions, scholarly articles, break even analyses, trend analyses, demographic trends, and data
used from a survey made specifically for Terre Haute Brewing Company to conduct appropriate
analyses including: demographic studies, likert scales, conjoint analyses, and local trends. All
data used/collected and articles are posted in the appendices and works cited. Results of data
analyses of the industry show that the industry for craft beer is moving very steadfast. There is
about 1.2 breweries opening per day, so to keep up with the fast industry the Terre Haute
Brewing Company Project Team, a part of the Sycamore Student Ventures group used the data
from the analyses to make appropriate recommendations to Terre Haute Brewing Company to
ensure that the new start-up company can explore every avenue of success.
The report finds that Terre Haute Brewing Company in its current position has more
positives than negatives. The major areas of weakness/threats require further investigation have
been analyzed and some remedial action by management/ownership may be required.
Recommendations discussed include:
Improving and expanding market awareness about the product and the company’s brand.
Corrected price points in relation to competition and consumer input.
Ways to enhance the ability to have diversified business operations.
How to properly price and use the space in the brewery for banquets, receptions, and other
events to increase profit.
Types of machines to effectively fill and label bottles, and which to choose.
Recommendations on how to network with distribution channels in the industry.
The report also investigates the fact that the analysis conducted has limitations. Some of the
limitations include:
Forecasting figures are not provided for accurate sales projections and trends in spending
because the company is a new venture and has no previous sales data. And Forecasting data for
entering the wedding/banquet market is limited because Terre Haute Brewing Company is a new
venture in the market.

Directional Analysis
For organizations to be successful, they need a clear defined direction that needs to be
pursued. The Terre Haute Brewing Company team of the Sycamore Student Ventures (SSV)
Consultants Group performed a directional analysis to determine what direction Terre Haute
Brewing Company is actually going (we will be referring to Terre Haute Brewing Company as
THBC for the remainder of the report). In the analysis we determined that the goals and
objectives of THBC were to keep the heritage alive within the community, appeal to the cities
younger demographic, have a venue for events such as weddings, music events, and banquets,
and also providing a microbrewery that Terre Haute can call its own. We determined that these
goals and objectives would positively affect THBC’s future as an organization.
Through the directional analysis we researched stakeholders and determined how THBC
creates, delivers, and captures value. THBC has a lot of potential value. Firstly, they have value
from the community by using the original building from 1837 as their location for their
operations. Also, the low competition in the area creates high value for THBC; with the closest
competitor being Indianapolis and Bloomington, THBC has a high value in the craft beer
drinkers in Terre Haute. They also have created value for themselves by using leftover space in
the back of the brewery to add in operation for a functional banquet hall. This space can be used
for weddings, music events, and banquets. These potential high value components should be able
to sustain value over an extended period of time.
Stakeholder Analysis
One of the most important indicators of success is how an organization interacts with its
stakeholders. Stakeholders are any people or groups that have a stake in how the organization
performs in supplying its goods and/or services. We need to identify the stakeholders we want to
create and decide how we are going to deliver value to and receive value from these
stakeholders.
Stakeholder Identification
Stakeholders can be internal or external to the organization, and the reach of stakeholders
extends far beyond what many organizations realize. Customers, employees, and suppliers are
often the first stakeholders to be identified. They are first to be identified because they have a
direct and close relationship with the organization. However, financial institutions, investors,
local authorities, the community, competitors, and other interest groups also have some stake in
the outcome of the organization. Figure 1 shows a web of the stakeholders and some of the
outcomes that affect them.

Figure 1
When coming into a brewery, customers look for quality products and good service. If
their service expectations are not met, they are unlikely to return to that particular establishment.
The studies of the service quality researcher, Parasuraman, concluded that there are five areas
that make up customers’ view of service quality which include: tangibles, empathy, reliability,
assurance, and responsiveness (Berry, Parasuraman, Zeithaml).
Customers come into any service encounter with an expectation of these aspects. Some
customers have very high expectations of the tangible aspects of the service exchange
(cleanliness, atmosphere, appearance), while others focus on the four intangible aspects. They
hope their server is responsive to their needs, empathizes with their wants, assures them of their
abilities, and performs reliable service. Each of these aspects is weighted differently in each
customer’s mind, and we are expected to meet or exceed their expectations. Not accomplishing
this creates the chance of customers not returning to the brewery. It could also create poor word
of mouth for the company.
THBC
Customers
• Quality Beer
Employees
• Wages
• Safe Environment
Suppliers
• Orders
• Continuity of
Business
Investors
• Loan Repayment
• Capital Growth
Local Authorities
• Compliance
• Responsibility for
Patrons
Community
• Community
Engagement
Competitors
• Fair pricing
• Growth of Industry
Special Interest
Groups
• Good
representation of
craft beer
community

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Employees look for a good working environment first. They expect fair wages and to be
paid the proper amount at the promised time. They also expect their managers to make sure that
they are being treated fairly by customers, management, and the other employees. Once the
basic requirements for fair wages and a safe and comfortable work environment are met,
employees then start looking for advancement opportunities and strong relationships. In return
for a high quality work environment, employees provide value by creating relationships with
customers and providing quality service, ultimately increasing overall profits.
Suppliers expect to receive regular and fairly predictable orders. If the THBC forms a
relationship with a supplier, orders from them regularly, and then ends the relationship with no
warning, it could cause issues in the future. Suppliers often communicate with other potential
suppliers in the same industry. Because of this, a bad ending to a business relationship could hurt
the overall reputation in the brewing industry. If suppliers are given a transparent and
continuous relationship, they will provide high quality goods, on time, and they may be more
willing to provide additional services at a lower cost.
The next section of the stakeholder analysis takes a closer look at investors. Terre Haute
Brewing Company investors have provided the value of start-up capital. In return, they expect
the brewery to establish operations that will create a return on their investment. They expect the
brewery will make money so their loans can be repaid with interest. They would also hope to
see the brewery grow, and if the THBC is looking to expand operations, the investors may be
willing to again provide the capital needed to start the expansion process.
Because of the nature of the business in selling alcohol, THBC needs to be aware of
compliance laws and other local ordinances that could affect the success and continuity of the
business. Organizations that provide alcohol have to be sure that they are selling only to people
that are legally able to consume alcohol. Not meeting these legal requirements could lead to
significant consequences including local authorities putting the brewery out of business. There is
also the risk that customers may consume too much alcohol while on the premise with the
possibility of running into issues after leaving the establishment. In situations like these, the
responsibility of the person who served the alcohol could be called into question for over pouring
or negligence to cut the customer off. Additionally, frequent issues with customers and the local
authorities could cause police to patrol the area directly outside the brewery. This could give the
brewery a bad reputation with customers whose records haven’t been harmed yet.
The Terre Haute community also has a high stake in the success of the business. If the
brewery creates a strong reputation among craft beer enthusiasts in the area, it will likely bring
them to Terre Haute to taste the beer and attend advertised events. This could drive profits of
other businesses such as the hotel industry, other restaurants and various locations in Terre
Haute. In exchange, the community will support the brewery, especially because of the historic
nature of the business. The local community would benefit from learning the history of the
brewery in Terre Haute as well as enjoying the revamped setup the brewery is currently
adopting.

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Interestingly, competitors also have a stake in the success of the THBC. Although our
closest competitors are further than 60 miles away, a failure for the THBC could indicate a
potential failure for all of the craft beer industry. Conversely, a successful start-up of the THBC
could connect new customers with craft beer, making them more willing and more likely to
travel further to try the craft beer brewed at other breweries. The THBC has the potential to
become part of a network of microbreweries that competes and strengthens the presence of craft
beer drinkers in Indiana by encouraging them to try the craft beers brewed at other breweries.
When it comes to special interest groups, the brewery caters to mainly craft beer
enthusiasts. Those who are serious about trying new beers will talk about their experiences at
the THBC with their other friends in the area who share their interests. They will expand our
market with word of mouth throughout the group if the brewery provides them with good
services and quality beer. The brewery may also face scrutiny from special interest groups
opposed to the consumption of alcohol. Members of this group cannot be appeased, but the team
does not believe they pose any serious threat.
Business model
A business model describes what, how and when specific activities are performed by the
organization. These activities create high customer value, through low-cost or differentiated
products, which allows an organization to deliver value. It is extremely important and effective
to have a full-proof business model and to be able to incorporate it, to create value. The business
model of THBC is to provide premium quality beer at competitive prices along with many other
products and services that cater to the community of Terre Haute’s needs. The business model
allows different operations to be implemented, which include the brewery, a full kitchen and
restaurant, a brewpub or bar, taproom and banquet hall. The business model outlines that the
operations and services are all available under one roof, making it convenient for consumers. The
mission statement of THBC is “Offering over 150 years of heritage to new styles of beer,
something that fulfills the craft beer enthusiasts’ pallet both from taste and nostalgia.” The vision
statement of THBC is to reach all craft beer drinkers in the Tri-state area with a proficient
distribution network, hopefully making THBC products one of the most sought after in the
market.
Defining Value
Value is defined as an element added to a product for which customers are willing to give
something in return. There are several ways Terre Haute Brewing Company has value. First,
even though that value is defined as an element added to a product, THBC product itself is
actually value added. Terre Haute Brewing Company will be the only place that true craft beer
drinkers, and beginners to drinking craft beer, will be able to get a premium craft beer. This is
value added to the external environment (craft beer drinkers) and to the organization. The second
value that THBC is creating is the value of heritage. The community in Terre Haute is heritage-

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bound. Old buildings and historical sites run through the city. The building being used is the
original building from 1837. This adds value to the organization because it will bring many
customers in for tours of the historic brewery. The community will also recognize that the
heritage is being preserved and not tainted in any way. Thirdly, THBC offers a diversification of
products and services that add value to the organization because it caters to the consumers needs.
With a working restaurant, taproom, brewery operations/tours, and area for banquet hall use, the
customers will receive value out of their visit to THBC regardless of the reason for coming in.
Finally, there is value added in the distribution of their product. By distributing to surrounding
regional areas, bars, and other venues, THBC will reach more consumers and spread brand
awareness for the organization. However, these distribution operations will not be up and
running for some years into production.
Delivering Value
Product
The main value delivered by the THBC is the opportunity to buy a unique craft beer that
is brewed locally. Customers value unique products and creating relationships with the brands
and the companies they purchase from. By having operations that are perceived to be transparent
and a focus on brewing the best beer, the THBC will forge strong bonds with their
customers. The transparency of the operations occurs through tours and visuals of the brewing
process, and customers will react positively to the relationships they create with the brewery and
its employees. Terre Haute Brewing Company must remember that everything is predicated on a
high quality product.
Diversified options
Terre Haute Brewing Company’s customers may have a shared interest in craft beer, but
each customer is still unique. To meet the desires and needs of each of these customers, the
brewery delivers diversified operations that fit the needs of all types of customers. The brewpub
operations are the most obvious aspect of the organization, and the THBC delivers value to
customers by producing high quality craft beer. The location also has the opportunity to provide
services to customers interested in hosting large events such as corporate parties, reunions,
wedding receptions, and other parties by opening the brewery as a place to hold these
events. The value delivered to customers through the availability of the space is the brewery’s
willingness to work with them to provide the help they need to host their events. Additionally,
THBC has the chance to use their large space as a place to have live music nights. The
community values local bands, and the brewery can capitalize on that value perception by
highlighting the things that are important to the community. Customers will look at the
diversified operations, and they will like the idea that the brewery is tailored to them.

Heritage
Terre Haute Brewing Company also delivers value to its customers in terms of becoming
a central player in the preservation of Terre Haute history and strengthening the local community
and the local economy. By putting a focus on the historical aspects of the THBC, we deliver
value to our customers and members of the community that value the importance of local
business and the history of Terre Haute. The focus on history extends beyond members of the
Terre Haute community. Historians from all over Indiana, the Midwest, and the United States
could take an interest in the revamped brewery. The focus on the history of THBC is also a
value to consumers who are attracted to craft beer that has a story and strong ties to the
community.
Bottling and Capping
Although the THBC is not planning on creating a bottling, capping, and distribution
network in the next few months, this could be a way to deliver value to customers who enjoy the
beer but are not close enough to the brewery to go as often as they would like. These customers
instead could purchase the beer at local convenience or grocery stores and enjoy them at home or
at parties with friends. Customers could also begin to perceive the beer brewed by the THBC in
a similar way to the Spotted Cow beer brewed in New Glarus, WI. Fans of this beer purchase it
in high volumes when they are in the area and take it home or to parties with them, introducing
their friends to the rare, hard-to-get beer in that area. By selling this beer in bottles, the THBC
could create a perception of status along with distribution.
Capturing Value
A business captures value when benefits are received in return for the value delivered to the
customers. First, by offering the value of the only premium craft beer made locally the company
will benefit from creating customer loyalty through monetary exchanges and advertising by word
of mouth. Secondly, by offering the value of heritage/history to our consumers the company will
benefit by becoming a staple in the community for Terre Haute’s rich history. Through THBC’s
diversified operations and the value it gives our consumers, the company will benefit by reaching
a wide variety of customers. By reaching the wide variety of consumers, we can expand our
market share and grow brand awareness ultimately sustaining the business for future growth. By
receiving these benefits and continually delivering the values, THBC can develop an edge over
the competition, allowing for customer retention and expansion of the business.
External Analysis
The External Analysis takes a closer look at the opportunities and threats that are present
in the industry, the local business environment, and the connections between the THBC and
other organizations. The opportunities and threats cover the bottom sections of the SWOT
Analysis shown in Figure 4, pg. 18.

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Political, Economic, Social, Technological, Environmental, and Legal factors all have
potential to impact our operations and our potential for success. Changes in these six factors are
what create these actionable opportunities and threats. Together, they form the General
Environment. The industry itself creates some areas to capitalize on and to avoid. The craft beer
industry is a combination of all microbreweries and the suppliers, partners, and buyers that are
connected to these breweries. To identify these opportunities and threats, we looked into survey
data provided to us by the Market Research class (MKTG 338) instructed by Dr. Sandeep
Bhowmick at Indiana State University. News articles, expert opinions, and market trends also
provided some of the background information talking about the changes in the craft beer
industry. Together, these help create much of our understanding of the general environment and
the intersections between the opportunities and threats presented by the environment and the
industry.
Opportunities
There are a number of opportunities available to THBC in the current market. Each of
these opportunities exposes unique potentials to increase awareness, customer base, and profit.
Unfortunately, some of the opportunities could cease to exist if they are not capitalized on
quickly. On the other hand, some of the opportunities will present themselves repeatedly, and
we must take advantage of them every time they appear. The high number of students in the area,
the pride in local businesses, the available space in the brewery, the relationship with our
investors, and the current awareness of the craft beer market are all areas for opportunity.
Terre Haute houses four college campuses, and each of them is unique and has potential.
The largest of these campuses is Indiana State University. As of Fall 2015, ISU has just over
13,500 students. Of course, not all of these students are above the legal drinking age, but it
means that over time, we have the opportunity to market to all 13,500 of these students. ISU is
also the closest campus to the brewery location. Students who live close to campus can walk
there fairly easily, allowing them to enjoy the drinks at the brewery without worrying about
someone driving them home later that night. This freedom has the potential to increase profits
since visitors can drink without having to make plans about getting home later that night.
Rose-Hulman has the next highest potential. There are 2,100 students attending Rose-
Hulman, and again, not all of these students will be 21 or older when they first attend school, but
eventually, each of these students could be our customer. Saint Mary-of-the-Woods is further
from the brewery than both ISU and Rose-Hulman. It also has a smaller population with around
1,700 students. Lastly, Ivy Tech’s Terre Haute campus could be another place that we can
advertise to. Additionally, each of these schools may have projects and case studies that could
be fulfilled by working with us, bringing more attention to the brewery and increasing the ties
between students on these campuses and the brewery. Figure 2 has a breakdown of the basic
statistics of these three colleges and their possible tie-ins to us.
Terre Haute is a strong market for local businesses, especially in the downtown area.
There are a number of boutiques, coffee shops, and restaurants in the downtown area that are
unique to Terre Haute, and these places have a lot of support because they are only found locally.
This support for local business is a growing trend, and the support is even stronger for

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millennials. An Edelman Digital study states that over 40% of millennials prefer to shop at local
businesses, regardless of whether or not the price at the local business was higher (Mackie,
"Marketing Success With Local Pride"). One of the reasons for this is that people want to feel
some sort of connection to the products they buy. We have a strong opportunity to make people
feel connected to the brewery and its products. One of the most unique things about THBC is
the vast history of the brewery, and this is something that we can use to our advantage.
Merchandise can be used to showcase the history by putting images from old pictures of the
brewery on shirts, hats, key chains, etc. This will allow customers to connect to the brewery. It
will also serve as great word of mouth advertising when others see the items with the brewery’s
name on it.
Figure 2
Summary of Terre Haute Colleges Statistics
College Size
Distance to the Terre Haute
Brewing Company
Indiana State University 13,584 0.6 miles
Rose-Hulman 2,100 5.2 miles
Saint Mary-of-the-Woods 1,703 6.3 miles
Terre Haute Brewing Company can also increase awareness of the brewery by partnering
with other local businesses. Mogger’s is the closest restaurant to the brewery, and THBC could
put their beer in the restaurant to be sold. Baesler’s is also an opportunity for us if we can sell our
bottled and capped beer in the local grocery store. Both of these options may not be the best
choice to maximize profit, but it will help spread awareness in the short-term.
Terre Haute Brewing Company has the space and the capacity to have multiple different
types of events that could help to increase profits. The free space in the brewery could be used
as a banquet hall. The historic atmosphere of the brewery makes it an appealing location for
wedding receptions, large parties, and live music events. Each of these types of events could
bring in a profit outside of the profit from customers purchasing the beer. For receptions and
large parties, a flat booking fee could help cover overhead costs, and live music events could
have a cover fee of $5 to $10 depending on the band and the day of the week. A full breakdown
of the potential for profits for utilizing this space as a banquet hall will be covered later.
Terre Haute Brewing Company has multiple investors with strong connections and a
good reputation in the area. Each of these investors wants to see this company succeed, and their
help, guidance, and connections could bring in more customers. The investors in Terre Haute
have a good understanding of the market and the people in the area. Any guidance or support
they give could have strong results.
The final opportunity to focus on is the growing awareness of the craft beer market. In
2013, craft beer production has grown 9.6% (Morris, "It's official: Craft brewers are beating big
beer"). This is an indicator of increased awareness and demand from those interested in the craft
beer market. Tapping into this market while it is still on the incline is a strong move for us.

Threats
Even though we have an effective list of opportunities, THBC still definitely has external
threats. Some of the biggest threats have to do with the existence of competition in the area.
This is amplified when thinking about the opportunity of selling to college students in the area.
Students typically go to bars and events that are cheaper. Another potential issue is the threats of
a direct competitor in the area in the form of another brewery focused on craft beer. Lastly,
THBC could face a problem if they begin to sell the beer through other outlets because it could
cause a loss in the awareness for potential large events and parties taking place at the brewery.
If we focus on ISU students as the opportunity to capitalize on, we run the risk of these
students not being willing to pay the higher price for the craft beer. The average price for a pint
of beer across the United States is $3.82 (Qebbo, "Pint Price"). Also, many students who do go
out in Terre Haute try to go out on nights go to bars with certain types of specials, pushing the
price of a pint of beer down. Nationwide, craft beers sell for an average of $5.00 (Hornsey, "The
Craft Beer Movement"), making the difference between the two types of beer slightly over $1.00
on average. It is possible that students will be willing to try the craft beer a few times, but it will
be difficult to make the brewery their first choice on an average night out. To make the most of
this opportunity with college students, THBC should have occasional events like live music
nights or theme nights to bring students in. The event could help bring in students, and a small
cover fee of $5 to $10 would help increase profits for the night.
Aside from students on a low budget, the average person living in Terre Haute doesn’t fit
the characteristics of the average craft beer drinker. The median household income in Terre
Haute is just under $40,000 (Realtor.com, "Terre Haute, IN - Lifestyle and Demographics -
Realtor.com®"). This differs from the majority of craft beer drinkers. A Nielson report states
that 58.9% of craft beer drinkers make over $75,000 each year, almost double the median income
for families in Terre Haute (Morris, "It's official: Craft brewers are beating big beer"). To combat
this threat, we should advertise specials to bring new customers in. Using the additional space in
the brewery as a space for parties or events could also bring new types of customers into THBC.
Early success at the brewery could also create threats later down the road. Currently,
THBC is the only brewery in Terre Haute, but success could bring in new and more direct
competition. A staff economist from a craft beer industry group stated that small craft breweries
are opening at a rate of more than one new brewery each day (Morris, "It's official: Craft brewers
are beating big beer"). If other entrepreneurs see the potential in Terre Haute, it could bring
competitors closer which would cause us to reevaluate our strengths and weaknesses in the face
of stronger competition.
One of the opportunities mentioned earlier could also cause one of THBC’s biggest
threats. By selling their products through other outlets, THBC could be unintentionally
redefining how they operate as a business. If we decide to focus the brewery as a place to come
in and drink at the bar, then selling the beer in local restaurants and grocery stores could lead to a
decrease in profits. Instead, THBC should decide whether or not we would like to operate as a
distributer or a bar. By using the space in the brewery as a bottling and capping center, THBC
could brew, bottle, cap, and distribute the beer to local outlets. Another possibility is selling the

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beer only at the brewery, making customers come in to the building to buy the beer. By making
them come in, it keeps the brewery in their minds as a place to hold events and parties.
Opportunity cost is the real outlier here, hopefully THBC can find a common middle ground and
have both operations running successfully.
Internal Analysis
Our Internal Analysis focuses on the strengths and weaknesses in THBC’s current
operations. Since they are still in the development stage of the business, it is difficult to
complete a full analysis on our operations. Instead, we chose to pinpoint the areas we believe
could become weaknesses and the strengths THBC could create in the operations to combat
them. The ability to create these strengths and our likelihood of falling prey to our weaknesses
are a direct result of our capabilities and our available resources. Capabilities include the skills,
experience, and knowledge to brew beer that people will buy. THBC’s resources include their
relationships with investors, recipes, machines, physical location, brand, and capital.
Strengths
The strengths of the brewery look at where operational capability and resource
availability intersect. The strengths discussed later are areas that the brewery can focus on when
beginning their operations. Having unique strengths or core competencies is one way to create
opportunities for success. The areas the team pinpointed as strengths are the lack of close direct
competition, the location, freedom of pricing, free marketing, the restaurant, the bar and
taproom, the space, start-up capital, and the proximity to downtown.
We have determined there can be many strengths created by THBC. The first one we
would like to address may be the most important strength: THBC is the only microbrewery in the
area. We have found that the nearest microbrewery is the Upland Brewery in Bloomington,
Indiana, which is approximately 60 miles from the THBC. This is a major advantage to us
because we can attract the local and surrounding counties. A list of the closest breweries and
their distances is shown in Figure 3. There are also three malls within 50 miles of Terre Haute,
one of which is in Terre Haute. This means are at least 46 surrounding counties in the Wabash
Valley that are likely to come to Terre Haute to visit our malls and restaurants. THBC can take
advantage of this by placing billboards on surrounding highways and interstates that come into
town. These would include Interstate 70, Highways 40, 41, 42, and 46, and Route 63 and 150.
We do not believe there will be college students from surrounding counties to come visit the
brewery, but we do believe students in Terre Haute will. Between Indiana State University, Rose
Hulman Institute of Technology, and Saint Mary-of-the-Woods College, there are approximately
17,500 students in the Wabash Valley. We find it beneficial to present these students with
marketing and promotional items on their campuses because, according to an article by
Newswire, 55% of local craft beer drinkers are aged between 21 and 34 (Bellini, "U.S. craft beer
drinkers by age and gender, 2012 | Statistic"). If we turn our merchandising and promotion on
these campuses into a strength, there will be a high potential for profit.

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Figure 3
Brewery Location Distance
Upland Brewery Bloomington, Indiana 57 miles
Three Pints Tap Room Martinsville, Indiana 66.6 miles
Sun King Indianapolis, Indiana 78 miles
Mash Craft Greenwood, Indiana 80.8 miles
Oaken Barrel Greenwood, Indiana 85.5 miles
3 Floyd’s Brewpub Munster, Indiana 152 miles
The next strength we find important is the fact that THBC can make their own prices.
This is going to be very beneficial to us because of the 17,500 students that live in the direct
area. Since we are looking at beer prices to be between $4 and $8 a piece, it will be beneficial
for THBC to be able to adjust the price of our products. This will allow students in the area that
are used to paying $2 for a drink at 7th and Elm Bar and Grille on Tuesdays and paying the same
price at the Ballyhoo Tavern on Thursday to appreciate of beer that is at a “discounted” price that
was made in the same town they go to school. This is going to persuade college students to visit
the brewery since they will be getting beer at a “discounted price.” This leads us to THBC’s
next strength: the fact that they brew our own beer. Approximately 44% of people drink or either
have drank craft beer and becoming more popular (Neilsen, "Newswire"). The success of the
breweries mentioned in Figure 2 show that microbreweries in this area of the United States have
the potential to reach consumers and convince them to try craft beer even if they’ve never been
exposed to this type of product before. We conclude that people are willing to experience the
craft beer sector and they will be able to do this in the Wabash Valley.
The next strength of the THBC is that they have a free range of marketing. Since THBC
is not captive to regulations of a franchise name, they can choose how creative they want to get
as long as it is within the law. It is beneficial that the Indiana State University campus is only a
couple blocks away, which will be a great contributing factor to us. By using the Marketing
classes of Mrs. Sara Williams, Dr. David Fleming, Dr. Sandeep Bhowmick, Dr. Jessica Mikeska,
Dr. Vernon Sweetin, Dr. Dale Varble and Dr. Joyce Young, THBC will have a large, free
consulting base on how to market to the Wabash Valley. Partnering with these classes and
gaining insights from their consulting will show us how we can appeal to the growing number of
consumers in the Terre Haute area. Additionally, by working with students, THBC will be able
to utilize more modern and creative types of marketing techniques to grow our consumer base
within the Vigo County colleges.

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Another strength is the restaurant aspect of the brewery. This is going to increase profits
because of food sales, but also it will directly increase beer sales. It is an added bonus that an
establishment sells food. Since THBC is selling food and beer, customers that are drinking and
eating could include beer with their order. Once the beer has arrived, they order their food, then
their food arrives, and there is any empty drink. The patron is going to need a refill on
something, and the server is going to promote the beer sales by targeting the empty beer. One of
the best ways to increase profit on both the food and the beer is to have a suggested pairing on
the menu. These pairings provide patrons with suggestions on which beers pair best with each
item on the menu. Tom Ryan, the founder of the Smashburger restaurant chain, says that his
burger and beer pairings have led to a “30% to 50%” sales increase in beer is some of their
markets (Rutonno, "Beer With That Burger? Smashburger Does Pairings"). On the other hand, if
THBC did not serve food and the same patron come in, he might come in during the hours of
dinner, grab one beer at the bar, and leave. By selling food, we keep the customers in the
brewery longer.
This goes hand in hand with our next strength of having a bar or tap room. Every day,
there will be a patron who is not eating but wants to sit at the bar and have a drink. Having a bar
or tap room is going to allow this patron to visit the secluded bar that is separated by a wall from
the dining area. This area provides the patron with access to televisions, personal bar service,
and a quicker dining experience if that is what they choose. The taproom is going to be a way to
show off our beers. This allows us to have an educated bartender working the bar and explaining
all of the products to customers. It also allows THBC to advertise that we serve liquor since it
will be displayed behind the bar.
Having the capability and capacity for live performances is a strength. Local musicians
that tour the Terre Haute, Brazil, and Seelyville area have groups of fans that follow them all
over the county. By featuring even local artists to the brewery it is guaranteed there will be
increased patronage. With the connections of investors, THBC has the ability to bring in big
name bands to the brewery. Other cities around the Wabash Valley, including Indianapolis, have
more talent in them. Recruiting bands from other cities is a simple process. With the equipment
the Brewery has, getting a local DJ to come in will be beneficial since other local bars use DJ
services to appeal to the students at ISU.
The brewery has strong investors. This strength is opening the door to many endless
opportunities. One strong investor is Greg Gibson who is a local businessman. Since Greg is
well connected in Terre Haute, he has access to special marketing and social opportunities in the
area. The Penske race team is an investor in the Brewery and their business has a great deal to
do with marketing. Jeff Hock, who is owner and operator, brings extreme knowledge,
leadership, passion, and experience with him. With the great investment these individuals have
made in the brewery, failure is not an option. The location of the brewery is in a historical
building. The brewery is located in the old brewery company building that was located there in
the 1950’s. The building is a historical piece of Terre Haute but more importantly the beer that
was sold in 48 states. The history of Champaign Velvet beer is extensive. The tribute and
historical displays the brewery is going to have will be a positive for THBC. Customers will be
able to view and learn history of Terre Haute while tasting some of its past.

18
The proximity to downtown is a strength for THBC and is beneficial to grow in size and
profitability. The building is located 1 block away from the popular Terre Haute restaurants
Moggers and Stables Steakhouse. Being in its current location allows the brewery to be viewed
more and reminded of its current existence. Being close to downtown and close to campus will
appeal to college students in the area. Its downtown location allows us to be a stop of the
popular Homecoming activity “The Walk.” It allows us to participate in vendor activities during
downtown block parties and events, during increasing our brand recognition in the community.
Weaknesses
Even though the brewery has not started its operations, the team was able to identify a
number of potential weaknesses that could affect the brewery’s performance. If the brewery
identifies these areas that could be weaknesses, they will be able to combat these issues before
they become too devastating to the operations. These weaknesses include appealing to a diverse
market, distance compared to other bars, lack of brand recognition, and the small space available
for parking.
We found many weaknesses that could potentially affect the brewery. Appealing to all
varieties of people and attracting them to the brewery is the first weakness of Terre Haute
Brewing Company. We must consider the techniques in order to get a variety of people to come
to the brewery. We feel that through promotional ideas and deals to students, we could attract
them to THBC. By bringing your student I.D. on certain nights like Thursday and Friday, you
can get your cover charge waived for the night. People of all ages need to be attracted to the
brewery, and we have found ways to do so. Having different events or themed nights for
different ages of people will also attract people to THBC.
The second weakness is that THBC is further away from ISU’s campus and the other bars
in that area. Considering it is not near all of the other Bars like the Ballyhoo Tavern, The Copper
Bar, and The Verve, it may be difficult to get students and other people to attend. Giving
incentives like discounts and giveaways to people will get people to come have a beer. This will
help with this weakness and make sure it will not affect THBC.
Right now, THBC has little brand recognition, and we have come up with ways to get our
name out there. By advertisement and marketing, we can promote THBC and spread the word
about the brewery. There are a lot of main roads and highways that take you to Terre Haute from
a radius around the city. Advertisements on billboards on major roads like 70, 41, and 65 and
many others will promote the business and attract people to THBC. Flyers, newspaper ads, and
television commercials will also help with this weakness.
Parking is also a concern for the Brewery. There is not a lot of places to park around the
THBC. 8th and 9th streets right by the brewery are good places to park and are very convenient.
Terre Haute Brewing Company owns a small parking lot but it is not big enough to
accommodate a large number of customers, and they may quickly need more space. In order to
turn this into a strength and not let this affect THBC, purchasing a lot close by and telling guests
where exactly to park would be a great option. Parking on 8th and 9th streets will be ideal, and

19
THBC will let the customers know to park there. This should not be a major problem for them.
Terre Haute Brewing Company may consider purchasing a lot close by, if available.
Figure 4
Modified SWOT Analysis
The Modified SWOT Analysis helped to identify areas of intersection between the four
sections of the SWOT (Strengths, Weaknesses, Opportunities, and Threats). The traditional
structure of the SWOT is modified to show these intersections and to identify the actionable
GAPs. For example, THBC has an intrinsic strength of the local and historical atmosphere and
an opportunity to tap into other types of industries. The intersection of these two components of
the Modified SWOT come together to uncover the actionable item of marketing the historic
location as a banquet hall to host large events. The Modified SWOT is shown in Figure 5.
Strengths
•Unique product
•Marketing outlets
•Cross-promotionofbeer and food
combination
•Bar/tap room
•Historic/local atmosphere
•Experiencedleader
Weaknesses
•Unfocusedtarget market
•No brand recognition
•Little parking available
Opportunities
•VigoCounty colleges
•Abilityto tap intoother markets
•Increasinginterestin craft beer
•Availabilityoflocal partners
•Connectionsofinvestors
Threats
•Low economy inTerre Haute
•Threat of closer competition
•Additional competitionfromenteringnew
industries
SWOT

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Figure 5
GAP Analysis
A GAP Analysis is used to identify areas of improvement or areas where the current
performance does not meet the potential performance of the organization. As the THBC has yet
to open and begin their operations, this GAP Analysis was created based on our understanding of
the intended operations of the THBC upon opening. As a team, we recognize that some of the
following recommendations may fall out of the scope of the business plan after opening and a
review of the brewery’s operations and capabilities is created. The GAPs and their subsequent
recommended actions show potential routes for us to take upon establishing our operations.
To determine the GAPs, the team used a number of different techniques. Sections
detailing merchandising, bottling and capping, and the banquet hall came to us as
recommendations from Hock. Other sections were identified through detailed analysis of our
SWOT, through results from the market research survey or through research of other local
breweries.

21
Marketing and Brand Awareness
One of the biggest gaps of the brewery is in its lack of a current marketing plan. We
identify this as an Urgent and a Critical GAP. Without a set marketing plan in motion before the
brewery begins operations, the overall brand awareness of the THBC is relatively low. Brand
awareness and excitement in the first few months of business are crucial, and if there is little
brand awareness, the first few months of sales may not reach their full potential. This poses a
problem for the THBC, but it is also an opportunity for them to provide a new type of service to
consumers in Terre Haute. The survey results from the market research survey from the
Marketing Research class show that 78% of respondents have tried craft beer before. Of the 17
respondents who said they had never tried a craft beer, six respondents said they would be
willing to try craft beer. The experience and willingness of these respondents shows that some
marketing on the part of the brewery could have significant results.
Creating brand awareness and loyalty is important for any organization because it brings
in new and repeat customers. It also helps increase the likelihood of word of mouth marketing.
Some ways other businesses, particularly businesses in this industry increase brand awareness
through merchandising, blogs, beer tastings, presence at festivals, or hosting regular and random
events. Mash Craft brewery in Greenwood, IN hosts a “Kegs ‘N Eggs” event every last Sunday
of the month. They have the breakfast foods catered in, and they introduce a new or featured
coffee-infused beer for the occasion. This is a good way to get customers excited about the
products. Some customers may be attracted to the brewery specifically because of the existence
of regular events like this. Figure 6 shows one advertisement for a similar event at the Fox Pub
in Peoria, IL.
Figure 6

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Terre Haute has plenty of opportunities for the THBC to get its name out there. Blue’s
Fest, Diesel Fest, Oktoberfest, and the Terre Haute Downtown Block Party are good ways for the
brewery to engage with potential customers. We highly recommend participating in events such
as these. This puts the brewery in a position to reach people in an atmosphere where they feel
relaxed, and they are open to trying new things. Providing them with quality product and good
service could make them want to come to the brewery to see the location and the process for
themselves, creating repeat customers. Another option to increase brand awareness is to offer
customers a type of service they are not familiar with. Many different types of restaurants and
bars suggest specific pairings of food and alcohol. If the THBC put a focus on events that offer
knowledge or advice on how to pair the craft beer with certain types of food, they can bring in
new customers and create a bond with them before new competition arrives. If the brewery
chooses to go this route, they will have to be certain their pairings are good, and the servers also
have to form an understanding of how and why each pairing works well together. A
knowledgeable staff will have to become a strength of the brewery’s operations while an
untrained staff would be a glaring weakness.
The brewery should also further explore merchandising options which is discussed in a
later section. Merchandising is a great way to increase potential for word of mouth advertising,
especially for college students. Seeing their friends and classmates wearing shirts with the
brewery’s name on it will encourage students to see the brewery for themselves.
Pricing
Another GAP presented by our analysis is the issue of pricing of the product and
matching our pricing and advertising to our target market and the demographics of that market.
Our survey was mostly taken by college students with 75% of the respondents indicating they
were a current student enrolled in a University, while the other 25% were various applicants
around the state who are interested in breweries, or interested in the alcohol industry. We also
found that the median income in Terre Haute is around $40,000 per year ("Terre Haute, IN -
Lifestyle and Demographics - Realtor.com®"). Compared to the income of the average craft beer
drinker ($75,000), consumers in this area fall short. The brewery will need to adjust our
marketing and pricing plans to match the market and its resources.
Pricing is so important because it is one of the biggest factors in determining if a
customer will come back to a bar or restaurant. Because an average pint of craft beer sells for at
least a dollar more than a pint of most domestic beers, the brewery must approach their
customers in a way different from the lower priced competition. Other breweries in Indiana have
seen the threat posed by selling higher priced alcohol in lower income areas, and they have
overcome these issues by offering different priced beer, advertising specials, and hosting theme
nights or events.
For the THBC, this is the biggest potential threat. Their unique product and atmosphere is
something that will stick out nicely in this part of the country, but the income levels and the
current economy in Indiana do not provide the best opportunities. There are a few ways to
combat this issue to keep the business thriving. When looking at the survey results, 57% of the
respondents indicated they would be willing to pay between $5 and $8 for a craft beer at a

23
brewery. Lastly, THBC can focus more of their business model on the idea of selling food. This
give THBC the opportunity to increase their profits, but it threatens to take the focus away from
the beer.
Diversified Operations
The third element to the GAP analysis for Terre Haute Brewing Company is its
diversified operations. All organizations need this within their business and there are many
benefits and advantages when this is used. We believe that THBC will definitely benefit from
having diversified operations. Overall, it can help the business and create many good
opportunities.
Some of the diversified operations for THBC include the restaurant, the brew pub (bar),
tap room, banquet hall and brewery operations. Each of these sections key operations to the
business will overall help THBC. The restaurant/ kitchen will provide customers with great food
and service while still operating as a brewery. The brewpub and taproom will allow customers to
enjoy some beer, which is a very important part to the company. The banquet hall will be
available for events such as weddings. All of these operations working together within THBC
will be beneficial and will make us different than other breweries.
By having a variety of operations within the company, this allows us to appeal to
customers by offering a variety of products, services and the convenience of having all these
options in one location. This is needed to minimize the risk just in case that one of our operations
fail. We have many ways to bring in money and provide great products and services. Therefore
the organization has financial backing by having many other sources of income. Since we are a
new venture by having other sources of income in case one does not excel will allow operations
to continue. This will also allow us to increase the variety of customers. Different types of people
with different interests will be attracted to the brewery due to the many operations. By
implementing these operations, this will also increase competition within the general area. Other
sources of income will overall help the business and could potentially help with expansion to
other cities. This could create the opportunity to grow and open other stores in locations such as
Indianapolis or Bloomington, Indiana. In these locations, there could be a combination of
specific operations. For example, in Bloomington, we could open up a store that would just have
brewery operations and a restaurant and not necessarily the banquet hall.
Overall by having diversified operations in Terre Haute Brewing Company this will
benefit the business and create opportunities. These diversified operations will bring different
sources of income for the company and allow THBC to continue and thrive.
Banquet Hall Use
A fourth GAP we identified was the use of the space for the banquet hall. The Wedding
Industry is one of the most profitable industries for small business owners. The low costs and
high profit margin is an easy choice for a facility than can host a large group of people. The
Wedding Report, a journalistic venture basing its information on wedding trends, conducts a
yearly survey that covers a broad amount of topics spanning from costs to fashion trends in

24
weddings and everything in between. Using some of the data from the 2014 year report we were
surprised how much the wedding industry was worth. The wedding industry is a whopping 58
billion dollar industry with the average cost for the weddings across the US being $36,441
dollars (this average is taken from over 2 million weddings). Indiana is ranked 15th in the US
with just under 50,000 weddings and the totals revenue from weddings Indiana ranked 18t.h
The Wedding Report also had great information on the wedding receptions. In 2011, 36%
of the total cost for the weddings was spent on the reception (about $13,367). The average guest
size was 152 people for indoor weddings and 245 for outdoor weddings. One of the best stats we
found was that liquor has increased in importance with an increase of 92% of weddings having a
bar readily available or signature cocktails since 2009. The largest owner of the market for
Wedding Receptions is still owned by Hotel/Resorts. At 66.4 % they have double of the
ownership of the rest of the industries than its competitors, however this rate is dropping rapidly.
Both the hotel industry and banquet halls have lost close to 4-6% of their market ownership
according to the Herald Tribune article “Banquet Facilities- Industry Overview.” All the other
locations that host banquet style events have been increasing, this is good news because THBC
has a great mix of things they offer if the venue is booked including: Restaurant, Corporate
Facilities, Museum style look and feel, and Music venue (Profile America, "Industry IQ: Key
Statistics, Market Trends, and Business Practices").
Interestingly enough, there is also a current trend happening for a need for non-traditional
wedding sites. According to Huffington Post unusual wedding reception venues are overly
popular these days, they suggest that old traditional halls and hotel ballrooms were over priced
and these unique locations, even though not far different in price, give more to offer for the
money spent. They also listed Breweries as the number two location for self owned businesses
for a wedding reception (My Online Wedding Help, "Budget Wedding Planning Blog").
With the THBC having the options of food, alcohol and space for over 400 guests they
are a perfect fit for offering their location as a potential wedding venue. Terre Haute has a large
need for a wedding venue that can hold over 400 guests. The other local venders such as the
Ohio Building, Indiana Theater and Stables hold a maximum of 300 people, giving us an
advantage over the competition. Below in Figures 7 & 8 we show the Gaps in the market with
our local competitors. It displays price per plate and location rental in comparison to our
competition.

25
Figure 7 & 8 (found using www.indianatheater.com, “Indiana Theater”,
www.indianazoo.com/wedding, “Indy Zoo”, www.stablessteakhouse.com, “Stables Steakhouse”,
www.indstate.edu “Hulman Center”, www.theohiobuilding.com, “Ohio Building”,
www.thelandingatfortharrison.com, “The Landing”, www.eventective.com).

26
The area that THBC can fit in the market gap (STAR) is offering a mid-priced per plate
option ($100-$140) that can host up to but not restricted to 400+ people. We recommend that
THBC follow this map and offer $100-$140 a plate per person and offer the venue location for
the price of (around $2000) which is a median priced based on other competitors averages. If this
is done, the location should be the best option for couples that are deciding which venue will be
perfect for their wedding. By offering competitive prices on our services (alcohol, catering, and
venue rental) while also offering the most space for wedding parties, THBC should have a
competitive advantage over the local and regional market.
Bottling & Distribution
The final GAP we identified through our analysis was the need for bottling the product
and distribution. Hock stated that it would be some time before this production started up, which
overall is not that bad of an idea. This will give THBC time to build its brand and quality
products before investing into machines for filling and bottling. However, we recommend
looking into the analysis given in the next paragraphs to give an initial idea of how the bottling
and distribution could be handled.
Initially, we looked at what type of equipment THBC needed to make sure their bottling
process would go smoothly. After some research in the matter, we found that the filling
machines were the most crucial aspect of the whole process. The cost for these machines are
high, but depending on how much product is being sold, the investment on the machine can be
made back fairly quickly.
When it comes to filling machines there are three different types of machines. First, the
manual machines; these are a great entry-level investment, usually for smaller brewing
companies. However, these machines probably wouldn’t meet the demands of a medium sized or
larger sized operation. Next would be the Semi-automatic machines. This machine is a good in-
between option. It is capable of producing more than a manual machine and requires less
manpower. On the other hand the machine is not fully automated and does require some
manpower. As in-between suggests, this is more expensive than a manual machine and less
expensive than an automated machine. Finally, the fully automatic machine is a clear choice for
larger breweries. They use much more space and require very minimal manpower (which will
lead to less labor costs). The automatic is, however, has a higher initial investment and takes
more time and money to maintain. Typically machines that are semi-automatic or fully automatic
include carbonation.
We conducted a break-even analysis to determine which would be the best option for
THBC whenever the company reaches the point of bottling:
Example: If THBC decided to brew about 60,000 gallons (about 1,936 bbls) a year.
That’s equates to 7,680,000 ounces. THBC would distribute those ounces amongst 12 oz., 22 oz.,
750-ml, 64 oz. (growlers) and kegs (15.5 gallons=1,984 oz.). THBC would have a good amount
of inventory to sell. But, for the investment to be a good one, first THBC will have to break even
from the cost of the machine chosen. Before we start anything, we must remember that THBC is
taxed $7 for 31 gallons produced, equaling $13,548.39 for 60,000 gallons.

**REMEMBER THESE EXAMPLES DO NOT INCLUDE KEG OR GROWLER SALES
SINCE NO FILLING MACHINE CAN FILL OVER 750ml CONTAINERS**
We have two options. First, we will take a look at the semi-automatic filling machine.
The semi-automatic machine would cost $51, 892. The machine has 2 filling heads and 2
crowners. It produces up to 12 BPM (bottles per minute). It also includes the labeler for the
bottles. This machine would fill any size bottle but only that size bottle. So, if THBC wanted
different sizes we would need 4 of the same machines. So, let’s say THBC only decides to do the
12 oz. bottles and will buy more machines later in time. If we sell them for $1.69 to a wholesale
(liquor store, bar, or restaurant) we would have to sell about 30,706 bottles to break even on the
initial investment of the machine. That’s only about 2,880 gallons of beer that needs to be
brewed and will take about 42 ½ hours to fill and label those bottles.
The second option is the fully automatic machine. This machine will cost $80,285. This
machine has 8-head filler and can fill up to 50 BPM. Bottle sizes from 12 oz. to 750ml can be
handled in the same machine with inexpensive replacement parts. This machine requires no
manual loading or unloading of bottles. Let’s say that THBC only decides to bottle the 12 oz.
(using same size as first machine for comparison). Selling at a wholesale price of $1.69 we
would have to sell 47,506 bottles to break even on the initial investment of the machine. That’s
equal to 4,454 gallons and the machine can fill that amount into bottles in about 16 hours.
Although it will take more bottles to break even in one year with the second machine, it
produces more per minute and it is flexible with bottle sizes. This means that if we bottle bigger
bottles such as a 22oz or 750ml we would not have to produce as much due to the fact they hold
more beer, making breaking even a little quicker. We recommend that THBC, when ready to
purchase filling machinery, should decide on the fully automatic machine. The semi-automatic
costs less, however since it only is made to fit one size bottle, if we wanted to bottle different
sizes we would have to by more machines for each type of bottle. Increasing the cost by double
or triple. With the fully automatic, it can do multiple bottles at once. The fully automatic does
not come with a labeler however, but it only costs around $20,000 (see in appendices), making
the total investment around $100,000. This investment though, is still cheaper than buying three
semi-automatic machines with labelers for around $150,000.
Lastly, distribution is huge when trying to make our consumers more aware of the brand. There
are numerous distribution networks that local establishments and liquor stores use to ensure they
ship products successfully and receive products successfully. President and CFO of the National
Beer Wholesalers Association (NBWA), Craig Purser was quoted as saying:
“If you look at the success of craft, it’s because distributors have been embracing
it… When you look at beer as a product, it’s sold through an independent distribution
network. It’s not an exclusive network. It’s a network where there is incredible access to
market. And we’re seeing distributors being very competitive when it comes to
obtaining the rights to these brands and being aggressive and active as it relates to
getting placement and distribution points at retail and growing both on and off
premise” (Crowell, "Craft Beer Distribution: Study the Market, Distributors and Your
Own Operations.").

28
WorldClass distribution group and Monarch Beverage are major players in the regional
alcohol distribution network. Most of the areas bars and liquor stores use the
WorldClass/Monarch network to ensure their shipments arrive and send on time. We recommend
that THBC look into WorldClass distribution first and then to Monarch Beverage before
checking other local vendors. With a strong distribution channel such as WorldClass and
Monarch we can reach our product to the tri-state area when THBC is ready to enter the market,
they can be found at www.WorldClasssBeer.com.
Summary of Findings
We will now recap a summary of the findings and recommendations that were discussed
in this report. First, a gap we found through our analysis was that THBC has low brand
recognition. We recommended that THBC do two things. Bring customers to the brewery by
offering events such as the “kegs and eggs” or by offering discounted items through a
promotional club such as a ”mug club.” This club would give a customer a glass mug that is
theirs, which stays at the restaurant, for a certain payment, and he/she gets discounted beer.
Promotional sales are a great way to get customers into businesses. The second recommendation
is bringing the brewery to the community. By going to beer tasting festivals and involving
themselves in Terre Haute’s numerous events (BluesFest, The Walk) they can bring the
community closer. Terre Haute Brewing Company can also put on its own events like Upland
brewery does with Tour de Upland.
Secondly, we found that pricing was a gap for THBC. Terre Haute’s income is above
average and most of the city is college student filled. So, THBC must be price conscience. We
recommended that THBC price their beer anywhere from $4-$7 depending on type of beer (of
course prices are subject to change). This will give people the benefit to by a pint near a more
normal price ($4) whereas more tasteful beer drinkers will buy the high end ($7-$8).
Thirdly, we found that the banquet hall space was a gap THBC needed to identify. We
recommended that they use the space for receptions and banquet events. With catering now in
place THBC will be able to offer all amenities under one roof, making it easy for couples to plan
their receptions with THBC. We recommended that the venue space be rented out for around
$2000 based on competition in the area (this would vary pending on negotiations with
customers) and the price per plate cost be from $100-$140 (this is food and alcohol included).
Finally, we looked at the bottling and distribution side of the brewery operations and
found that the most important aspect of bottling is the bottles themselves along with the
machines that fill them. We looked at two different machines, one semi automatic machine and
one fully automatic machine. A break-even analysis was completed and we determined that the
fully automatic machine would be the best investment for THBC. It will produce more bottle
quicker and can do multiple bottles simultaneously. However, it will not include a labeler, but
even after purchasing a labeling machine it would still be a better investment.
Thank you for reading this report, if there are any questions or concerns please contact Joseph
Banfield at jbanfield@sycamores.indstate.edu

APPENDIX
Related Definitions
Business Model – A Business Model is a configuration of the elements of a business, how they
work together, and how they produce profits. A Business Model is a view of a business at any
given point in time, i.e., a description of the operations of a business including the components of
the business, the functions of the business and the revenues and expenses that the business
generates.
Capabilities - Qualities, abilities, or features that can be used or developed to create potential.
Competitive Advantage – The result of a company’s matching a core competency to the
opportunities in the marketplace
External Analysis- An analysis that looks at the external (or outside) factors related to the
organization and how those factors may provide opportunities or threats to the organization.
GAP Identification – A system that uses numerical representation of where the company is as
compared to where the company would like to be.
GAP Summary – A ranking of all the GAPs identified in the Modified SWOT Analysis without
prioritizing or drawing comparative conclusions.
General Environment - The General Environment is the broad environment encompassing
factors that influence most businesses in a society. There are a number of critical segments in
the General Environment that include the economy (changes in inflation, interest rates, or
currency exchange rates), socio-cultural (societal trends that affect consumer demand),
political/legal (changes in tax laws or government regulation), technological (technology may
create or make obsolete new products/services), global (international operations), and ecological
(environmental issues).

30
Industry - When talking about a unit’s industry, we are talking about anyone who is related with
the same product/service as the unit. There are three main divisions within an industry:
customers, competitors, and suppliers. Identifying and understanding other units within one’s
industry is important when trying to achieve competitive advantage.
Internal Analysis - The process of identifying a firm's resources and capabilities that contribute
(or have the potential to contribute) to its competitive advantage.
Marketing Plan – A written document that specifies the activities to be performed to implement
and control an organization’s marketing activities.
Marketing Strategy – A strategy for identifying and analyzing a target market and developing a
marketing mix to meet the needs of that market.
MissionStatement – A broadly stated definition of the organization’s basic business scope and
operations that distinguishes it from similar types of organizations. A long-term view of what the
organization wants to become.
Opportunities - Favorable or advantageous circumstances that have the potential to find or
create a competitive advantage.
Stakeholder – A person, group or institution the firm wants to benefit or who is associated with
the business and affected by the performance.
Stakeholder Analysis - A technique you can use to identify and assess the importance of key
people, groups of people, or institutions that may significantly influence the success of your
activity or project. A stakeholder analysis is a key tool used to determine who the company
strives to deliver value to.
Strengths:
 What are your advantages?
 What do you do well?
 What relevant resources do you have?
 What do other people see as your strengths?

31
Sustainable Competitive Advantage – The abilities and resources to create, deliver and capture
value for their stakeholders over an extended period of time.
S.W.O.T. Analysis - A SWOT Analysis is a type of assessment that provides a concise overview
of a firm’s strategic situation. SWOT stands for Strengths, Weaknesses, Opportunities, and
Threats.
Threats - Obstacles faced by a company that prevents them from reaching their goal of
achieving a competitive advantage.
Value – The unique characteristics created by the organization that appeal to each customer
individually.
****Customer Benefit – Customer Cost = Worth of Product****
Vision – An attractive, ideal future that is credible yet not readily attainable.
Weaknesses:
 What could you improve?
 What do you do badly?
 What should you avoid?

32
SURVEY DATA RESULTS FOR THBC
THBC Report
Last Modified:11/26/2015
1. What it your age?
# Answer Response %
1 Under 21 4 5%
2 22-30 65 79%
3 31-40 7 9%
4 41-50 4 5%
5 51+ 2 2%
Total 82 100%
Statistic Value
Min Value 1
Max Value 5
Mean 2.21
Variance 0.51
StandardDeviation 0.72
Total Responses 82

33
2. Have you ever been to a brewery before?
# Answer Response %
1 Yes 46 61%
2 No 30 39%
Total 76 100%
Statistic Value
Min Value 1
Max Value 2
Mean 1.39
Variance 0.24
Total Responses 76
3. How often do you go to a bar per week?
# Answer Min Value Max Value
Average
Value
Standard
Deviation
Responses
1
Timesper
week
0.00 5.00 1.52 0.88 67
4. During each visit to a bar, how many drinks do you consume on an
average?
# Answer Response %
1 0-1 10 13%
2 2-3 38 50%
3 4-5 22 29%
4 6+ 6 8%
Total 76 100%
Statistic Value
Min Value 1
Max Value 4
Mean 2.32
Variance 0.65
Total Responses 76

34
5. During each visit to a bar, how much do you typically spend?
# Answer Response %
1 $5-$10 16 21%
2 $10-$15 27 35%
3 $15-$20 15 19%
4 $20+ 19 25%
Total 77 100%
Statistic Value
Min Value 1
Max Value 4
Mean 2.48
Variance 1.17
Total Responses 77
6. What is your preferred alcohol (Click all that apply)
# Answer Response %
1 Beer 38 50%
2 Wine 18 24%
3 Liquor 54 71%
Statistic Value
Min Value 1
Max Value 3
Total Responses 76
7. When you are out for drinks, do you tend do order food?
# Answer Response %
1 Yes 48 62%
2 No 29 38%
Total 77 100%
Statistic Value
Min Value 1
Max Value 2
Mean 1.38
Variance 0.24
Total Responses 77

35
8. What is the maximum amount would you pay for one alcoholic
beverage in a brewery (special) setting?
# Answer Response %
1 $2-$3 9 12%
2 $3-$4 15 20%
3 $5-6 27 36%
4 $7-$8 16 21%
5 $9+ 8 11%
Total 75 100%
Statistic Value
Min Value 1
Max Value 5
Mean 2.99
Variance 1.34
Total Responses 75
9. Have you ever tried craft beer before?
# Answer Response %
1 Yes 60 78%
2 No 17 22%
Total 77 100%

36
Statistic Value
Min Value 1
Max Value 2
Mean 1.22
Variance 0.17
Total Responses 77
10. How willing are you to try a craft beer?
# Question
Very
unwilling
Unwilling Neutral Willing
Very
Willing
Total
Responses
Mean
1 Willingness 31.25% 6.25% 25.00% 37.50% 0.00% 16 2.69
Statistic Willingness
Min Value 1
Max Value 4
Mean 2.69
Variance 1.70
Total Responses 16
11. When you go out for drinks do you bring friends?
# Answer Response %
1 Yes 76 100%
2 No 0 0%
Total 76 100%
Statistic Value
Min Value 1
Max Value 1
Mean 1.00
Variance 0.00
Total Responses 76

37
12. During a typical visit to the bar, how many friends normally go
with you?
TextResponse
3
4
3
3
3
4
2
5
2
1-2
2-3
4
4
4
3
1
3
2-4
5
at least1
2
3-5
3-4
1
3
3
3
3-4
2
3
5
4-6
2
A few
2
4
6
2
2-3
2-4
2
3
2-3

38
3
2
2
4
3
2-4 friends
2
3
3
1-2
2
2-3
2
3
2
3-5
2
3
2 to 4
3
2
2
2
3
1
4
4
2-3
3
4
3
4
3-5
Statistic Value
Total Responses 76
13. Do you prefer to go to a bar on holidays or for special occasions?
# Answer Response %
1 Yes 50 66%
2 No 26 34%
Total 76 100%

39
Statistic Value
Min Value 1
Max Value 2
Mean 1.34
Variance 0.23
Total Responses 76
14. When you go to a bar, how likely are you to purchase beer?
# Answer Response %
24 VeryUnlikely 15 20%
25 Unlikely 8 11%
26 Undecided 6 8%
27 Likely 22 29%
28 VeryLikely 25 33%
Total 76 100%
Statistic Value
Min Value 24
Max Value 28
Mean 26.45
Variance 2.33
Total Responses 76
15. When you decide to go out for a drink, would you enjoy a
brewery setting?
# Answer Response %
1 Yes 64 84%
2 No 12 16%
Total 76 100%
Statistic Value
Min Value 1
Max Value 2
Mean 1.16
Variance 0.13
Total Responses 76

40
16. How familiar are you with any of these types of beer?
# Question
Highly
Unfamiliar
Somewhat
Unfamiliar
Neither
Unfamiliar
nor
Familiar
Somewhat
Familiar
Highly
Familiar
Total
Responses
Mean
1 IPA 21 9 5 15 26 76 3.21
2 Porter 26 8 11 12 19 76 2.87
3 Lager 13 7 7 23 25 75 3.53
4 Ale 11 7 7 23 26 74 3.62
5 RedAle 17 14 9 23 13 76 3.01
6 Malt 18 16 7 18 17 76 3.00
Statistic IPA Porter Lager Ale Red Ale Malt
Min Value 1 1 1 1 1 1
Max Value 5 5 5 5 5 5
Mean 3.21 2.87 3.53 3.62 3.01 3.00
Variance 2.78 2.65 2.17 2.05 2.09 2.32
Standard
Deviation
1.67 1.63 1.47 1.43 1.45 1.52
Total
Responses
76 76 75 74 76 76

41
17. Are you more likely to go to a bar because of the drink specials?
# Answer Response %
1 Yes 51 67%
2 No 25 33%
Total 76 100%
Statistic Value
Min Value 1
Max Value 2
Mean 1.33
Variance 0.22
Total Responses 76
18. How often do you purchase specialty beer?
# Answer Response %
1 Never 20 26%
2
Lessthan
Once a Month
18 24%
3 Once a Month 9 12%
4
2-3 Timesa
Month
14 18%
5 Once a Week 9 12%
6
2-3 Timesa
Week
6 8%
7 Daily 0 0%
Total 76 100%
Statistic Value
Min Value 1
Max Value 6
Mean 2.89
Variance 2.68
Total Responses 76

42
19. What kind of entertainment do you prefer? (Click all that apply)
# Answer Response %
1 Dj 44 57%
2 Live Band 49 64%
3 Standup 20 26%
4 No Music 2 3%
5 Televisions 32 42%
Statistic Value
Min Value 1
Max Value 5
Total Responses 77
20. While visiting a bar, rank the importance of availability of the
following amenities
# Answer
Total
Responses
1 Wi-Fi 16 11 12 15 11 8 73
2
Nice
Tables/Chairs
28 21 10 10 4 0 73
3 Dance Floor 5 8 18 15 11 16 73
4 Live Music 18 8 20 10 12 5 73
5 Television 5 19 10 12 19 8 73
6 Games 1 6 3 11 16 36 73
Total 73 73 73 73 73 73 -

43
Statistic Wi-Fi
Nice
Tables/Chairs
Dance Floor Live Music Television Games
Min Value 1 1 1 1 1 1
Max Value 6 5 6 6 6 6
Mean 3.25 2.19 3.92 3.07 3.62 4.96
Variance 2.80 1.55 2.35 2.54 2.38 1.79
Standard
Deviation
1.67 1.24 1.53 1.59 1.54 1.34
Total
Responses
73 73 73 73 73 73
21. What kind of light setting do you prefer at a bar?
# Answer Response %
1 Dim 48 62%
2 Light 7 9%
3 No Preference 22 29%
Total 77 100%
Statistic Value
Min Value 1
Max Value 3
Mean 1.66
Variance 0.81
Total Responses 77
22. What is your gender?
# Answer Response %
1 Male 40 53%
2 Female 36 47%
Total 76 100%
Statistic Value
Min Value 1
Max Value 2
Mean 1.47
Variance 0.25
Total Responses 76

44
23. Are you currently enrolled in a University? (i.e. St. Mary of the
Woods, Rose Hulman, Indiana State University, etc...)
# Answer Response %
1 Yes 57 75%
2 No 19 25%
Total 76 100%
Statistic Value
Min Value 1
Max Value 2
Mean 1.25
Variance 0.19
Total Responses 76
24. Are you a current resident of Terre Haute?
# Answer Response %
1 Yes 48 63%
2 No 28 37%
Total 76 100%
Statistic Value
Min Value 1
Max Value 2
Mean 1.37
Variance 0.24
Total Responses 76
25. What is your annual Income?
# Answer Response %
1 0-$15,000 46 62%
2
$15,001-
$30,000
9 12%
3
$30,001-
$50,000
6 8%
4
$50,001-
$75,000
6 8%
5 $75,001+ 7 9%
Total 74 100%

45
Statistic Value
Min Value 1
Max Value 5
Mean 1.91
Variance 1.90
Total Responses 74
Terre Haute Indiana United States
Population 59,788 7.62 Million 320.100 Million
Household Income $38,656 $47,655 $52,746
Avg. Household Net
Worth
$304,755 $414,198 $484,469
Median Age 36 years 37 years 37 years
Here is a handy Beer pricing list we used to price the beer for
wholesale: http://www.wineaccess.com/file/store/totalwine/beer-
corridorwine.pdf

46
Brochures for filling machines:

47
FILLER & LABELER TECHNICAL SPECIFICATIONS
M6L M4L M2L
Filling Heads 6 4 2
Crowners 6 4 2
MLBottleLabeler Included Included Included
Filler Dimensions
41” (1066mm) W 41” (1066mm) W 36” (900mm) W 55” (1676mm) L 55” (1676mm) L 55” (1676mm) L

48
Standard Configuration Stand with Swivel Casters Stand with Swivel Casters Stand with Swivel Casters
Fully Automated Yes Yes Yes
Touch Screen Controls Yes Yes Yes
Auto Cleaning/Sanitizing Yes Yes Yes
Production Rates Up to 40 BPM Up to 30 BPM Up to 12 BPM
Rinser Yes Yes No
Long Tube Filling Yes Yes Yes
Auto Crown Sorter Yes Yes Yes
Pre-Purge Yes Yes Yes
Single & Double Pre-Evac Yes Yes Yes
Auto Fill Detection Yes Yes Yes
Auto Leak Detection Yes Yes Yes
Manual Override Yes Yes Yes
CO2 Pulse Intensity Yes Yes Yes
Operating Pressure 95 psi(6.5 bar) 95 psi(6.5 bar) 80 psi(5.5 bar)
ML BOTTLE LABELER
Label Application Rate Up to 60 BPM Depending on Label and BottleSize
Label Size Maximum 5 inches (125mm) H x 12 inches (304mm) W - Standard Unwind Roll #4
Label Spool Diameter 9 inches (228mm)
Label Core Size (ID) 3 inches (76mm)
Maximum BottleDiameter 4 inches (101mm)
Conveyor Dimensions 4 inches (101mm) W x 60 inches (1524mm) L
Labeler Dimensions 60 inches (1524mm) L x 35 inches (889mm) W x 52 inches (1320mm) H
Supply Voltage 120 VAC 60 Hz (240 VAC 50 Hz Option)
Labeler Air Pressure 50 psi(3.5 bar)
Turnkey SystemPrice USD $81,105 USD $76,126 USD $51,892
FILLER & LABELER OPTIONS
M6 M4 M2
M Series Stand
Alone Filler
USD $65,492 USD $61,330 USD $34,742
Big Hopper USD $685 USD $685 N/A
Rinser Included USD $2,885
ML Bottle
Labeler
MLStand Alone
Labeler
USD $19,395 USD $19,395 USD $19,395
Label Ink-jet
Date Coder
USD $19,395 USD $2,495
Meheen Manufacturing, Increserves the right to change product design andoptions. Pricingsubject tochange.
WWW.MEHEEN.COM

49
Works Cited
 Berry,Leanard,Valerie Zeithaml,andA.Parasuraman."SERVQUAL:A Multiple-itemScale For
MeasuringConsumerPerceptionsof ServiceQuality."Journal of Retailing,4Apr.1988. Web.29
Nov.2015. http://areas.kenan-flagler.unc.edu/Marketing/FacultyStaff/zeithaml/Selected
Publications/SERVQUAL- A Multiple-ItemScale forMeasuringConsumerPerceptionsof Service
Quality.pdf .
 Mackie,Diana."MarketingSuccessWithLocal Pride." TheHuffington Post.
TheHuffingtonPost.com, 10Apr.2015. Web.29 Nov.2015.
 Morris, Chirs."It'sOfficial:CraftBrewersAre BeatingBigBeer." CNBC.2Mar. 2014. Web. 29
Nov.2015. http://www.cnbc.com/2014/02/26/rewery-revolution-heats-up.html .
 "PintPrice."Qebbo.com.Web.29Nov.2015.
http://www.pintprice.com/region.php?/United_States/USD.htm .
 Hornsey,Ian."The Craft BeerMovement." Priceonomics.1Oct. 2013. Web.29 Nov.2015.
http://priceonomics.com/the-craft-beer-movement/ .
 "Terre Haute,IN - LifestyleandDemographics - Realtor.com®."Realtor.com.Web.29Nov.2015.
http://www.realtor.com/local/Terre-Haute_IN/lifestyle) .
 Bellini,Jason."U.S.CraftBeerDrinkersbyAge and Gender,2012 | Statistic." Statista.Web.29
Nov.2015. http://www.statista.com/statistics/289529/us-craft-beer-drinkers-by-age-and-
gender/ .
 "Newswire.”Tapped In:Craftand LocalArePowerfulTrendsin the Beer Aisle. 15 July2015. Web.
29 Nov.2015. http://www.nielsen.com/us/en/insights/news/2015/tapped-in-craft-and-local-
are-powerful-trends-in-the-beer-aisle.html .
 Rutonno,Tom."BeerWithThat Burger? SmashburgerDoesPairings." CNBC.26 Apr.2013. Web.
29 Nov.2015. http://www.cnbc.com/id/100676624 .
 "IndustryIQ:KeyStatistics,MarketTrends,andBusinessPractices."Profile America,2006. Web.
29 Nov.2015. http://www.heraldtribune.com/assets/pdf/advtips/IQ_BanquetFacilities.pdf .
 "BudgetWeddingPlanningBlog." My OnlineWedding Help RSS.Web.29 Nov.2015.
http://www.myonlineweddinghelp.com/bridal-news/staying-within-budget/76-unexpected-
wedding-reception-venues.

50
 www.indianatheater.com, Indiana Theater
 www.indianazoo.com/wedding, Indy Zoo
 www.stablessteakhouse.com, Stables Steakhouse
 www.indstate.edu Hulman Center
 www.theohiobuilding.com, Ohio Building
 www.thelandingatfortharrison.com, The Landing
 www.eventective.com, The above sites were used in this database to find quotes on prices
used in the Joint Space Map found on page 24
 Crowell, Chris. "Craft Beer Distribution: Study the Market, Distributors and Your Own
Operations." Craft Brewing Business. CBBMedia LLC, 10 Sept. 2013. Web. 1 Nov.
2015.
 "In-Line Labeling's New Model CF-8." The Brewer Magazine. In Line Labeling, 12 Oct.
2015. Web. 1 Nov. 2015.
 "Filling Machine Purchase Guide." Kinnek. Kinnek Knowledge Team, 2012. Web. 17
Nov. 2015.

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