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Adolph Coors in the Brewing Industry

Solution Id Length Case Author Case Publisher
2643 1681 Words (6 Pages) Pankaj Ghemawat Harvard Business School : 388014
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The United States of America is the location of the Coors Brewing Company, which was established in the year 1873. The fortunes of the company have gone up and down in tandem with the tides of the brewing business throughout its history. In 1985, the company had been in operation for 113 years, and during that time, it had recorded several different instances of its success. The number of breweries saw a 13 percent rise in output, although it was considered that beer consumption remained the same. During that time, the company's annual revenues were more than one billion dollars. Before the company achieved its current level of success, it had already developed performance-enhancing business procedures such as distribution and marketing as well as procurement and supply chain management. There were several factors that led to the fall in competitiveness that Coors experienced between the 1970s and the middle of the 1980s, but some actions were essential to the company's long-term success.

Following questions are answered in this case study solution:

  1. Why did the brewing industry become more concentrated between the 1950s and 1980s? 

  2. Coors was very successful in the mid-1970s. Why? What were the sources of Coors' competitive advantage?

  3. How did Coors' performance change relative to its competitors between 1977 and 1985? Why? 

  4. What, if anything, might Coors have done differently earlier on?

Case Study Questions Answers

1. Why did the brewing industry become more concentrated between the 1950s and 1980s? 

The brewing industry in the United States has been progressively concentrated over the course of the preceding two decades for a variety of different reasons. There are three separate justifications that have been offered for this. There are two primary factors contributing to the reduction in the number of people drinking beer in the United States: (even though consumption of premium beer has been increasing). Because of escalating expenses associated with advertising, it is becoming more challenging for smaller breweries to compete in the market. Because of developments in canning and delivery technology as well as growing advertising costs, the minimum efficient size of production required for mass-market brewers has consistently increased throughout the years. As a direct result of this transition, the number of breweries producing beer for the mass market in the United States saw a precipitous decline. As a result of the cutthroat competition that centers on aggressive pricing, brand loyalty, distribution channels, and national advertising spending, there were only 24 mass-market brewers left in the United States in 1970, a significant drop from the 82 that existed in 1970. Because of the dominance of these three businesses in the brewing industry, the industry as a whole has been more centralized. This article focuses on the factors that have a detrimental effect on a company's competitiveness throughout the 1970s and the mid-1980s. To begin, it is possible that the performance of the firm was hindered as a direct result of some of the company's purchasing procedures. This would be the primary contributing factor. In the case study, it is shown that Coors' competitive position deteriorated as a result of the company's decision to raise the number of expenditures it made. The purpose of the investment was to enable the corporation to achieve its aim of vertical integration of its business processes and operations. The company has made investments in ingredients for beers, facilities, and other equipment as part of its attempts to become self-sufficient in procurement and maintain quality standards. These initiatives are part of the company's efforts to maintain quality standards. The installation of additional machinery made it easier to produce secondary packaging, labels, recycled glass, and recycled glass products, among other things.

2. Coors was very successful in the mid-1970s. Why? What were the sources of Coors' competitive advantage?

The Adolph Coors Brewing Company began operations in the same year as its namesake did, 1873. The organisation has not been able to make any headway toward its growth ambitions during either prosperous or difficult times because of the obstacles it has been forced to surmount. A company's competitive status within an existing industry may be influenced by a wide number of variables, each one of which may have an impact at any one time. A product's distribution and manufacture are merely two phases in a multi-step process that also includes marketing and promotion. This process also includes other stages. According to the findings of the case study, Adolph Coors saw a decline in their competitive position as the decades moved from the 1970s into the 1980s. Problems with the company's ability to acquire products and services impeded the company's efforts to build a better vertical integration of its business practises and operations in the sector.

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