Coopers Business Case Essay

1. Introductionbarrel makers Brewery has had a successful journey from its low-down beginnings to it third tier position in duopolistic competing market. Coopers has non existed without its tract of disturbances and find of been taken over by a wider global player, even Coopers managed to defend itself. Coopers has positioned itself in a highly free-enterprise(a) market with a differentiated trademark and product that has set outd a niche market. Coopers has too successfully integrated a high quantify chain which in debate captures the essence of Coopers at the same time delivering value at fivefold stages. In order for Coopers to stay competitive in the future, Coopers differentiation strategy fag translate into revolutionary emerging markets and changing customer tastes for beer and deliver beer to overbold niche market segment.2. Company scopeEstablished in 1862 by Thomas Cooper, Coopers is a 5th times family own vocation that manufactures and sells beer, home brew and malt leave off. In 1997, the business purchased a $40 million state of the art manufacturing, bottling and distribution go under in Regency Park South Australia. With advanced robotics and a commitment to an eco favourable plant and processes to reduce their carbon footprint, Coopers has never lost sight of their burster. military mission StatementCoopers mission report for its beer as stated in the discipline study was toprovide natural beverages and food ingredients which satisfy tastes and nutritional needs, and micturate entertainment (Hubbard 2008, pg7)3. Company Analysis Porters five ForcesTo assess the competitive grace and to understand where Coopers Brewery is positioned a number of assessment stupefys or framework fag end be used. To assess Coopers Brewery current competitive position Porters five forces standard (see appendix 2) can be used to analyse its current state. a) menace of the new entrants is Low. in that respect are two types of operat ions i. one is the craft-brewing , also cognize as miro-brewing, market and the other ii. Large scale production. admission in the Craft-brewing is somewhat increasing, however larger scale production requires large capital outlay and continuous investment whilst been maintained by authoritative cash flow (Kaczanowska 2010). In addition incumbent beer producers are known to the consumers due the history and the accumulated advertising of the brand. This high cost for brand awareness creates a barrier for new players (Kaczanowska 2010). Imported products are present although the threat to the Australian market appears low. b) Threat of substitute products This can be described as medium for the beer application. There are always beer substitutes such(prenominal) as wine-colored, ready to drink mixers and soft drinks to name a few. progressively health-conscious and knowl coastable consumers are looking at higher character reference products (Kaczanowska 2010).This can be reflec ted in the trend toward craft and premium beers. c) Bargaining fountain of buyers is Medium Brand loyalty is strong among beer consumers as appose to wine consumers (Richardson 2012). Richardson (2012, pg 24) summed this up as Wine consumers are driven by extract rather than loyalty and wine brands are easily substituted, but beer is a branded product and consumers drink the label. However consumers are price highly sensitive and may switch to a nonher brand if the situation is presented. d) Bargaining precedent of the suppliers Medium Raw Material is the largest cost to breweries. IBISWorld estimate approximately 58.3% of industry revenue (Kaczanowska 2010), these raw materials include, cardboard boxes, glass, aluminium, packaging. Other Raw materials would include sugar, malt, hops, wheat, rice, water, barleycorn all of which are critical ingredients forbrewing. All of which have a add risk, which in turn can have a direct bushel on the cost of the supplies good. Coopers ha ve initiated some efforts to reduce some of these risks such asi. Water supply to the operations is from a deep aquifer,ii. occasion supplied by a Gas co-generated turbineiii. Chemical and Preservative Freeiv. float minimisatione) Rivalry among existing establishment is medium but increasing. There are three main players in the Australian beer market, Fosters and Lion Nathan with Coopers being in third place, by market share (see Appendix 1). Fosters and Lion Nathan are both world(prenominal) conglomerates with Coopers being the Family owned Australian brewer. It could be said that Coopers is the David to the two goliaths being Fosters and Lion Nathan (Byrom and Lehman 2009). i. Price-based rivalry Pricing does have a part to play in rivalry, however price wars in not evident in this segment. ii. Non-priced based rivalry The beer industry sits primarily in this space, where each company focuss efforts in branding, packaging and quality to target their demographic. iii. Product differentiation Cooper has a grotesque or niche market segment (Byrom and Lehman 2009) based on a Family owned and distinctive cloudy beer.In addition to the beer portfolio Coopers also has major interests in Home Brew equips and Malt extraction and has about 80% of the kit market (Byrom and Lehman 2009). Porter (1985) suggests that having a differentiated product strategy does not necessarily equate to high market share, this can been seen in the competitive market share analysis as seen in the appendix envision 1. However a point of differentiation can be replaced or replicated by a competing company and may reduce the competitive good Coopers currently has in the market. Continuous competitive analysis is needed to reinforcement this a differentiated strategy.4.Coopers time value ChainThe value chain model as described by Porter (1985) indicates that gaining a competitive advantage, an organisation focuses efforts to the internal activities of the value chain and attempt to strength these activities toadd to the fight of the firm. Coopers Brewery value chain could be reflected in the below diagram ancestor ISO case study 2013Coopers have made improvements in some of the value chain as seen in the case study, malt extraction for resale,Machinery and new processing operations to brew beer in the bottle or the keg rather than the tank without preservatives and chemicals. Water supply from deep aquifers with sale extract and then reuse of salt in the brewing process. Energy, having their own power generation system that feeds non-used emery back into the grid. Coopers use energy efficient fervor to reduce consumption. These improvements form part of the value chain activities that add to Coopers achieving a competitive advantage in the market. There are many move to the value chain as reflected in Appendix 4 (Porters Value Chain model) and efforts to manage and maintain each element is ideal. However a strategic view and focus may harness high results, it is suggested that aligning value chain efforts with the core vigilance of the business. In Coopers case by having a differentiation strategy efforts should be align with this strategy including product innovation, R&D and quality.4. Current position status in this paper refers to the Porters model of Three Generic Strategies (1985). Coopers can be recognised as Differentiation in the Porters model, seen in Appendix 5. In this cluster Coopers can easily differentiate itself from its competitors. Coopers has an Australian History with a family heritage that still exists today, additionally having a product that has a distinctive cloudy appearance separates itself from the globalised conglomerates in the Australian beer industry. Coopers leverages this differentiator and applies this to marketing campaigns.5. Future direction for CoopersTo suggest and press future options to Coopers, a reflection of Coopers mission statement to provide natural beverages and food ingredients whi ch satisfy tastes and nutritional needs, and create enjoyment (Hubbard 2008, pg7). This mission statement can be used for the future direction of thebusiness, as marketed as a family owned business and continue to capture the premium niche market it is positioned in. The future has a changing grace with regards to consumers tastes, Coopers also captures taste in the mission statement. With the changing taste and desire of Generation Y consumers, Coopers competitive edge could be erode by imported premium beers and or the increment of micro breweries that specialise in premium craft beers. Options can be summarised as follows Continue to leverage the Family owned business brand.Exporting the unique beer overseasContinually improving the value chain and seek boost opportunities to capture value. Continually focusing on changing consumer tastes and reviewing whether or not to compete in those markets. This will create new product conduct cycles, in a declining market (Nwabueze 2001 ). The future challenge for Coopers would be identifying new market opportunities, both on product and geographic level, whilst still achieving the family self-possession which has been seen as an advantage since Coopers started.6. APPENDI XESAppendix 1 Competitive Market luck Australia and South Australia.Appendix 2 Porters pentad Forces ModelSourceHarvard handicraft Review(Porter 2008)Appendix 3 Beer production Value ChainSource (ISO 2013)Appendix 4Appendix 5Source (Porter 2008)7. RefenecesByrom, John, and Kim Lehman. 2009. Coopers Brewery Heritage and Innovation in spite of appearance a Family Firm. Marketing Intelligence & Planning 27 (4) 516-523. doi http//dx.doi.org/10.1108/02634500910964074. Hubbard, Graham. 2008. Coopers Brewery. IVEY. Business. The University of western Ontario. The University of Western Ontario. ISO. 2013. Baltika Breweries-Economic Benefits of Standards -Case Study. ISO ORG. http//eng.baltika.ru/. Kaczanowska, Agata. 2010. Beer Production in the Us. IBISWorld Industry Report 31212, http//www.ibisworld.com.au/. Nwabueze, Uche. 2001. The Journey for extract The Case of new-made Product Development in the Brewery Industry. JOURNAL OF produce & BRAND MANAGEMENT 10 (6) 382-397. http//www.mcbup.com/research_registers. Porter, M. E. 1985. Competitive Advantage Creating and Sustaining Superior Performance. New York Free Press, https//www.google.com.au/search?q=Competitive+advantage%3A+Creating+and+sustaining+superior+performance&ie=utf-8&oe=utf-8&aq=t&rls=org.mozillaen-GBofficial&client=firefox-a&channel=sb&gfe_rd=cr&ei=eAyoU5j-Gs3C8ge9v4DACA. Porter, Michael. 2008. The Five Forces That Shape Strategy. Harvard Business Review. http//hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/ar/1. Richardson, David. 2012. The Liquor Industry. 14,