1. Northern Alberta Institute of Technology Principles of Managagement Winter 2016 Chris Barrett MGMT1120-Winter 2016 Principles of Managagement Winter 2016 Chris Barrett MGMT1120-Winter 2016 Northern Alberta Institute of Technology Table of Contents Amsterdam Brewery.........................................................................................................................5 9B15B003 AMSTERDAM BREWERY Erica Furgiuele wrote this case under the supervision of Elizabeth M.A. Grasby solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality. This publication may not be transmitted, photocopied, digitized or otherwise reproduced in any form or by any means without the permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e) cases@ivey.ca; www.iveycases.com. Copyright 2015 Richard Ivey School of Business Foundation Version: 2015-04-22 It was August 2014, and Jeff Carefoote, owner and president of Amsterdam Brewery (Amsterdam), had just finished reviewing the company's mid-year results. Amsterdam currently produced over 20 different craft brews, each with its own brand name. Within the growing and competitive craftbrewing industry, Carefoote was always interested in devising the best and most effective marketing strategies for all of the company's brands. Since Amsterdam's inception, the All Natural Blonde brand had been the company's top-selling brew; however, in recent years, its specialty brews had been driving growth. Going forward, Carefoote wanted to decide on promotional strategies that would best continue to grow the company's brands and increase its profitability. The company had also been experiencing operational capacity issues due to continuously increasing demand. As a result, Carefoote was also considering investing in capital expansion to increase Amsterdam's brewing capacity. Carefoote planned to discuss his recommendations with the company's staff at the fiscal year-end meeting. THE BEER INDUSTRY In Canada Dating back to as early as the year 1000, beer was an alcoholic beverage composed of water, yeast, malt sugars and hops. Ranked 20th in the world for per capita beer consumption, approximately 10 million Canadians drink an average of 80 litres of beer annually, 1 making it Canada's most popular alcoholic beverage and making the brewery industry Canada's largest alcoholic beverage sector. 2 Labatt, Molson and Sleeman were the three largest commercial breweries, representing 91 per cent of the Canadian market. Non-commercial breweries (which included craft and microbreweries) occupied the remaining 9 per cent of the national market. Domestic beer represented nearly 90 per cent of the market, but the share of imported beer had increased every year. Pale lager was the most popular beer in Canada. 1 Beer Canada website, www.beercanada.com/industry-statistics, accessed February 5, 2014. Government of Canada website, www.agr.gc.ca/eng/industry-markets-and-trade/statistics-and-market-information/byproduct-sector/processed-food-and-beverages/the-canadian-brewery-industry/?id=1171560813521#s1, accessed February 5, 2014. 2 5 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. 2. 9B15B003 Craft Breweries Brewery classifications were determined on the amount of beer produced and their ownership. A craft brewery was defined as being privately owned and producing no more than approximately 7.6 million litres of beer annually. Craft brewers' products also had to contain at least 50 per cent traditional malt. 3 Microbrewers were defined by volume, at less than 1.7 million litres of beer per year. The Ontario Craft Brewers (OCB) Organization had been founded to promote local breweries and to act as a force for lobbying the government because its laws were not supportive of craft breweries. Fifty of the 75 licensed craft brewers in Ontario were currently OCB members. 4 Distribution in Ontario The sale of alcohol was heavily regulated in Ontario. The only two licensed retail outlets were the government-owned Liquor Control Board of Ontario (LCBO), which sold beer, spirits and wine, and The Beer Store (TBS), which sold beer only. As of 2013, there were 447 TBS locations and 639 LCBO locations in Ontario. TBS carried 447 brands from 104 breweries, 5 representing 80 per cent of all beer sales in Ontario, with the remaining beer sales coming from the LCBO. Ontario craft brew sales led the beer segment at the LCBO, with 33 per cent growth in 2013 over the previous year. Previously, in 2011, craft brew sales had grown 45 per cent. 6 By law, brewers were required to charge the same retail selling price for their product regardless of their distribution channel. Additionally, brewers were allowed to sell products through their own retail stores only if the store was physically attached to the brewery itself. AMSTERDAM BREWERY History Amsterdam Brewery originally opened in 1986 as Toronto's first craft brew pub, thus offering Torontonians their first taste of craft beer. In 1988, the company's second location opened in downtown Toronto on King Street. In the early 1990s, the company shifted its focus to become a microbrewery, a decision that resulted in considerable success. Carefoote acquired the company from its original owner, Roel Bramer in 2002. By 2005, Amsterdam had outgrown its King Street location and continued its expansion as a microbrewery with a move to Bathurst Street. Until the move in 2005, 70 per cent of Amsterdam's sales were made within a 10-kilometre radius of the brewery. Amsterdam's roots were in Toronto, and Carefoote believed it best that Amsterdam remained a local brand. With growing success, Amsterdam needed a much greater brewing capacity, so it moved operations to Leaside in midtown Toronto and, in 2013, opened the Brewhouse, a brew pub on the Lake Ontario waterfront. The Brewhouse increased Amsterdam's presence in the city, exposing customers to the opportunity to experience more of its brands while returning to the company's original roots. The 3 Malt is defined as barley or other grain that has been steeped, germinated, and dried, used especially for brewing. Ontario Craft Brewers website, www.ontariocraftbrewers.com/pdf/media_IndustryFactSheet.pdf, accessed February 5, 2014. 5 The Beer Store website, www.thebeerstore.ca/about-us/did-you-know, accessed February 5, 2014. 6 Liquour Control Board of Ontario website, www.lcbo.com/content/lcbo/en/corporate-pages/about.html, accessed February 5, 2014. 4 6 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 2 9B15B003 Brewhouse promoted its 300-seat capacity patio as well as indoor seating, an onsite brewery and a retail store. Amsterdam continued to focus on expansion within the Greater Toronto Area (GTA). Financially, Carefoote strove to achieve earnings before interest, taxes, depreciation and amortization (EBITDA) of 15 per cent annually. TBS represented approximately 11 per cent of Amsterdam's sales and offered slightly better margins than the LCBO. The LCBO accounted for approximately 27 per cent of Amsterdam's sales. Amsterdam products were available in select LCBO and TBS locations across Ontario, mainly within the GTA. For this reason, Amsterdam had a feature on its website that allowed customers to track which locations carried its products. Sales Amsterdam operated two retail stores: the first was located at the Brewery in Leaside, and the second at the Brewhouse downtown. See Exhibit 1 for Amsterdam's two current locations. The two breweries' own retail stores were their most profitable distribution channels. The retail stores' purchases totalled 10 per cent of the company's sales. Forty-four per cent of Amsterdam's sales were made to restaurants and bars across the GTA in the form of bottled beers and kegs 7 of beer to serve on draught. Although it was more profitable to sell kegs over bottles of beer due to the cost of bottling, each of these options catered to different customer needs (i.e., kegs for large quantity distribution versus bottles for single servings). Restaurant distribution also helped to promote the Amsterdam brand because it gave new customers the opportunity to taste the product and it satisfied existing customers who wanted their beer of choice. Often, restaurants provided signage of the beers on draught, featured in-house promotions of their beers or suggested menu pairings. The balance of Amsterdam's sales (8 per cent) was made through the Brewhouse brewpub, brewery tours and venue rentals at the Leaside location, along with other small promotional activities such as local beer festivals. Operations Amsterdam's main brewing operations took place in its midtown Toronto brewery. Although its relocation to this building in 2012 allowed for increased capacity, Amsterdam had yet to produce enough product to meet the demand during the summer months. The demand for product in June, for example, was double the demand for product in January. The high capital costs for yet another expansion made Carefoote hesitate. The brewery had a maximum brewing capacity of approximately 40,000 hectolitres, and each hectolitre was converted into 12.2 cases of beer. With Amsterdam's variety of products, time and capacity were lost in switching between brews. See Exhibit 2 for approximate brewing times for each beer. The brewing time was also tied to the beer's retail selling price because some beers required more complex processes or brewing time that resulted in higher costs and, therefore, higher selling prices. 7 A cask or barrel, usually holding from 19 to 38 litres, often used for beer storage. 7 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 3 9B15B003 Marketing As a local Toronto brand, Amsterdam had always targeted its marketing in the GTA. When the brewery left its downtown location for Leaside, Carefoote knew Amsterdam needed to maintain its presence in the city so, less than a year after relocating, the Brewhouse was opened as a key marketing outlet in downtown Toronto. The Brewhouse offered its customers more exposure to the brand, as well as an opportunity to try new products and see parts of the brewing process firsthand. The Brewhouse had exceeded its sales expectations since its opening in 2013, but this scenario failed to translate into increased sales of the product offsite. Carefoote wondered how to improve on this aspect and how to keep the brand on the top of consumers' minds once they left the brewpub. Social media made up another major piece of Amsterdam's marketing strategy. Carefoote recently updated the company website for both the brewery and the Brewhouse, and he had a team in charge of the company's Facebook page and its Instagram and Twitter accounts. The Facebook page had reached 6,700 \"likes\" and featured updates on new products, product availability, events at the Brewhouse and information on beer events in the GTA. Amsterdam also ran a blog that featured beer-themed information, from brewing techniques and beer history to reviews on local events. Due to its low cost and easy access to target consumers, social media was an effective outlet for Amsterdam. Amsterdam also attended beer festivals across Ontario. These events attracted beer drinkers and allowed Amsterdam to display its products, educate customers and provide sample products for tasting. This forum also provided an easy way to receive product feedback. The law prohibited the sale of products to take home at these events, but by delivering an enjoyable experience to consumers, Carefoote expected that sales would increase at Amsterdam's various retail outlets. In addition, Amsterdam distributed limited print advertising and flyers in the downtown core. In the past, the company had presented some mass media campaigns, but Carefoote was not convinced that mass media would be the most effective medium for promoting the company's brands. THE COMPETITION Mill Street Brewery Founded in 2002, Mill Street Brewery was a craft brewer located in Toronto's historic Distillery District, approximately three kilometres from the Amsterdam Brewhouse. The company operated a brew house pub, similar to Amsterdam, which had 13 of its products on tap. The brewery's products were also available in restaurants across Ontario, the LCBO and TBS retail outlets. In 2007, 2008 and 2009, Mill Street Brewery was named the Canadian brewery of the year. The Mill Street Original Organic beer was Ontario's first certified organic beer and Mill Street's most successful product. Steam Whistle Brewery Steam Whistle Brewery was founded by three friends in 1998. The company was located on Bremner Boulevard, across from the Rogers Centre in downtown Toronto, less than one kilometre from the Amsterdam Brewhouse. Its slogan \"Do one thing really, really well\" referred to the brand's only iconic product, the Pilsner Brew. Steam Whistle beer was sold from the company's retail store at the brewery, as well as in numerous restaurants across Ontario and in LCBO and TBS retail outlets. Steam Whistle offered 8 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 4 9B15B003 event space onsite at its brewery and hosted corporate and private events. The brand was now expanding across Canada. Other Competitors Ontario had over 35 craft breweries, with most of their products also sold in the LCBO or TBS. Non-craft breweries still represented a majority of the beer market sales and occupied a large portion of the retail outlets' shelf space. Imported beers were increasing in popularity, as were cider products, 8 all designed to cater to the same \"easy drinking\" beer market. THE AMSTERDAM PORTFOLIO The Amsterdam portfolio of beers had evolved over the years from only two kinds of beer to over 20 different brews. Historically, all brands in the product line included the Amsterdam name. For example, the All Natural Blonde and Downtown Brown beers were known as \"Amsterdam Blonde\" and \"Amsterdam Brown.\" Now, each beer had its own brand identity, often without the Amsterdam name. Amsterdam's current product lines could be categorized into five groups: pale ales, amber ales, seasonal ales, adventure brews and India pale ales (IPAs). 9 See Exhibit 3 for each brand's percentage of Amsterdam's total sales. Pale Ales Pale ale had the lowest alcohol by volume (ABV), 10 and its beers were considered highly drinkable and welcoming. This category included the 416 Local Lager and the All Natural Blonde, which contained 4.16 per cent and 5 per cent alcohol, respectively, making them a lighter, refreshing flavour of beer. Both products were available year-round and through all of Amsterdam's distribution outlets. Most beer drinkers entered the market drinking pale ale. Historically, Amsterdam had initially attracted its customers through its pale ales. Beer drinkers often graduated from pale ales to the other beer categories over time as they became more comfortable with the beer's brand and its taste. The All Natural Blonde The All Natural Blonde (Blonde) was one of the original brews produced by Amsterdam and the first craft lager sold in Toronto. The original recipe was still used today, and this flagship brand was allocated 85 per cent of Amsterdam's total marketing budget. As the most popular brand, Blonde also faced the most direct competition from Mill Street Organic and Steam Whistle Pilsner beers. 8 An alcoholic drink made from fermented crushed fruit, typically apples. India Pale Ale (IPA) is a hoppy beer style within the broader category of pale ale. 10 Alcohol by volume (ABV) is a standard measure of how much alcohol (ethanol) is contained in an alcoholic beverage (expressed as a percentage of total volume). 9 9 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 5 9B15B003 The 416 Local Lager The 416 Local Lager (416) was categorized alongside the Blonde as a highly drinkable beer. With its lower ABV, it was often the choice of female beer drinkers. Consequently, Amsterdam marketed 416 towards this consumer. This brand was also developed to support Amsterdam's Toronto roots. Amber Ales Featuring the standard 5 per cent ABVs, amber ales had a stronger flavour. This grouping included the Big Wheel Amber Ale and Downtown Brown. In this and the remaining categories, the use of cans and labelling grew increasingly important because they were purchased by more educated beer drinkers. Along with the seasonal category, beer drinkers in this category were interested in exploring beer with more and different flavours. Both brands in this category had 5 per cent ABV and were available year-round through all of Amsterdam's distribution outlets. Big Wheel Deluxe Big Wheel Deluxe was produced year-round. Its taste was described as a \"balance between the rich traditional pale ale with the drinkability of a modern lager.\" Downtown Brown Originally called Amsterdam Brown Ale, this brew was also one of Amsterdam's original beers and continued to be made with the traditional recipe. Brown Ale was recently rebranded with a new name, Downtown Brown, and a redesigned can. These external changes resulted in a 20 per cent increase in the product's sales with no changes made to its taste, selling price or distribution. See Exhibit 4 for a comparison of the old and new can designs. Amsterdam Seasonals High demand for beer in the summer gave birth to Amsterdam's Seasonal Brews. These brews were designed to combat the months throughout the year when Amsterdam's operations had excess capacity. The Seasonal Brews used transitional blends of hops and malts creating new, rich and flavourful beer styles. The alcohol content, distribution and availability varied by product. This product category included brews such as Spring Bock and Autumn Hop. See Exhibit 5 for full product descriptions. Adventure Brews As the name portrays, the Adventure Brews were complex and innovative small-batch brews. These brews provided brewers with opportunities to be creative in their microbrewing processes. Made in very small quantities, these brews took anywhere from five weeks to years to brew. For example, a recent Adventure Brew was fermented in wine barrels for two years before being served. These brands were often very successful over the short time periods they were made available to the consumer. Carefoote wondered 10 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 6 9B15B003 whether these brands were too disposable because, even if consumers developed brand loyalty or wished to buy the products again, they were not always available to purchase. Adventure Brews were made and sold exclusively at the Brewhouse, and a new brew was released every two weeks. See Exhibit 6 for an example menu of adventure brews. If the product was well liked by customers, onsite brewers might brew additional batches and, if demand remained strong, occasionally a few cases of the brew were made and bottled by hand at the location. Packaging and branding was key to this category's success, and the ABV varied by product. This category's wide variety of flavours, from fruit-infused to whisky-infused brews, attracted male and female heavy and light drinkers. Carefoote's analysis of trends, from both outside research and Brewhouse data, indicated the market was demanding and moving in the direction of favouring specialty beers. The consumer palate was also becoming more educated due to these specialty brews, further supporting the increasing demand for specialty brews. The Brewhouse could produce multiple small batches of unique product but, if this was where consumers' purchases were heading, Carefoote believed Amsterdam was not capitalizing enough on this market. The pale ales were still the bulk of the company's sales so it was not clear whether the company should focus on gaining new customers in the entertaining pale and amber ale categories, or in the experience categories of Seasonals, IPAs and Adventure Brews. India Pale Ales IPAs were hop-forward 11 designs with high ABVs. These brews required intense microbrewing and consequently mandated a higher selling price. Along with the Adventure Brew family, these brews were designed to provide consumers with an elevated beer-tasting experience. The intense flavours attracted a variety of consumers, from new to experienced beer drinkers. In this category, packaging and branding were also highly valued by beer drinkers. Finally, due to the high ABV and distinct tastes, most purchasers were male drinkers. Boneshaker The Boneshaker Unfiltered IPA was originally brewed for an IPA contest and was classified as an Adventure Brew. The unique brewing process started out as an experiment by the brewmaster that resulted in an award-winning taste. In 2011, the product won silver at the Ontario Brewing Awards, and, in 2014, it won Gold at the Canadian Brewing Awards. The demand for the brew had grown exponentially, so Amsterdam now brewed and sold the product throughout the year. Boneshaker had an ABV of 7.1 per cent, appealing to more discerning and experienced beer drinkers. CONCLUSION In conclusion, Carefoote had numerous decisions to make between now and the scheduled year-end meeting. Amsterdam's 2013 EBITDA12 had fallen short of its goal by 5 per cent due to the brewery move in 2012 and the opening of the Brewhouse earlier in 2013. To date, Amsterdam had reached 9.4 per cent EBITDA, and Carefoote was hoping to see improvement in this figure by fiscal year-end, December 31. 11 12 The taste of the hops was a strong flavour observed in the beer. Earnings before interest, tax, depreciation, amortization. 11 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 7 9B15B003 His strategy was to study the profitability of each brand so he could maximize Amsterdam's profitability. See Exhibit 7 for a breakdown of each beer's selling price and variable cost. Furthermore, Carefoote was unsure whether Amsterdam should keep releasing and promoting new products quickly to cater to the faster growing segments or whether he should continue to focus on building the original products. The company had limited resources to spend on marketing, so supporting all brands equally was not feasible. Finally, should he put funds towards building the brands at all, or would the money be better spent on capital investments to increase brewing capacity? Carefoote was eager to settle on a strategic plan and direction to ensure Amsterdam's competitiveness in the market. 12 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 8 9B15B003 EXHIBIT 1: MAP OF AMSTERDAM LOCATIONS Source: Good Maps -- My Maps. EXHIBIT 2: FERMENTATION TIME BY BREW Adventure Brews Fracture Boneshaker Amsterdam Seasonals Downtown Brown Big Wheel All Natural Blonde 416 0 5 10 15 Days Source: Company files. 13 20 25 30 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 9 EXHIBIT 3: PERCENTAGE BREAKDOWN OF SALES BY BRAND Fracture 2% Adventure Brews 2% 416 8% Boneshaker 20% Amsterdam Seasonals 3% Downtown Brown 8% All Natural Blonde 43% Big Wheel 14% Source: Company website. 14 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 10 9B15B003 EXHIBIT 4: CAN REDESIGN OF BROWN ALE Source: Company files. 15 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 11 9B15B003 EXHIBIT 5: DESCRIPTION OF TWO AMSTERDAM SEASONALS Source: Company website. 16 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 12 9B15B003 EXHIBIT 6: SAMPLE ADVENTURE BREW BEER MENU Source: Company website. 17 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 13 9B15B003 9B15B003 EXHIBIT 7: COST BREAKDOWN PER BREW RETAIL SELLING PRICE ($ / 473 ML CAN) VARIABLE COST ($/ 473 ML CAN) 416 Local Lager 2.65 1.11 All Natural Blonde 2.25 0.99 Big Wheel 2.25 1.10 Downtown Brown 2.65 BRAND Amsterdam Seasonals 4.25 Boneshaker 1.22 13 2.95 2.95 Fracture Adventure Brews 1.62 15 4.95-6.95 17 Source: Company files. 13 For a 500 ml bottle. For a 500 ml bottle. 15 For a 355 ml bottle. 16 For a 355 ml bottle. 17 Prices vary per brew; smallest quantity sold was a 600 ml bottle. 18 Prices vary per brew; smallest quantity sold was a 600 ml bottle. 14 18 2.17 14 1.50 16 2.32-3.27 18 For use only in the course Principles of Managagement Winter 2016 at Northern Alberta Institute of Technology taught by Chris Barrett from March 14, 2016 to May 31, 2016. Use outside these parameters is a copyright violation. Page 14 NOTICE REGARDING COPYRIGHT This custom course package contains intellectual property that is protected by copyright law. It is illegal to copy the material within this package without the written consent of the holder(s) of the copyright. This material has been copied under licence from Access Copyright or the copyright owner. Resale or further copying of anything in this package is strictly prohibited. Unless otherwise stated, Copyright Richard Ivey School of Business Foundation. www.iveycases.com Stakeholder analysis Production in Amsterdam brewery had by 2014 20 different craft brews. Natural blonde was the top selling brand. There's need for promotional strategies to improve the company's profitability. Capital investment is needed for expansion to improve capacity. Beer industry Canada; ten million approximate consumers annually. Largest commercial brewers include labbat, molson and sleeman. Pale lager was the most popular beer in Canada. Craft brewery is privately owned with a production of 7.6 million litres approximate annual beer. The company's products contain 50% of traditional malt. Ontario craft brewery was formed to lobby government on its punitive brewery laws and increase local consumption of products from local breweries. Craft brewery led in beer sales with 33% in 2013. Amsterdam brewery Officially opened in 1986. Offering beer to the people of Toronto. Second location was opened in 1988 in downtown Toronto. It started with two retail stores in Leaside and Brewhouse. 44% of sales went to bars and restaurants. Restaurant distribution promoted Amsterdam brands because new customers had a new taste. Selling keg over beer bottle was more profitable due to bottling cost. 8% of sales was made through Brew house brewpub brewery tours and venue rentals. Operation takes place in midtown Toronto brewery. With a maximum brewery capacity of 40,000hectolitres. Marketing is targeted in GTA. Marketing was also done on social media. Company website was updated and a team was placed in charge on facebook. Due its low cost social media was a preferred choice of marketing. Attending events attracted beer drinkers that allowed its product a much needed display. Competition Its main competition include mill street brewery, steam whistle brewery. Portfolio Beer portfolio evolved with time. Beer brands all include the Amsterdam name include adventure brews, Amsterdam seasonal, downtown brown, big wheel deluxe, amber ales, the 416 local lager, the all natural blonde and pale ales. NPEST Natural environment- raw materials for production come from the environment. For beer its barley. The company has to outsource the materials from famers who produce at a certain cost agreeable by the company. Timeline has to be ensured to avoid delay in making the products available to the market. Environment as a resource has to be protected. Waste products from the company have to be treated before it is disposed. Air pollution must be checked within the local surrounding. The company should be investing in clean sources of energy like electricity as this is cost effective and promotes living in clean environments.[ CITATION Spily \\l 2057 ] Political- analysis politically of the beer industry. Alcohol sale is regulated in Ontario by the government. There are 447 beer stores as of 2013. Political stability has ensured business continuity without interference from external factors. Canada liquor laws are heightened to ensure a responsible drinking generation. Alcohol too has got its effects that affect the growth of the economy. Diseases like liver cirrhosis are prone to alcoholics. Drinking age varies from 19 to 18. Selling hours is also regulated the authorities. [ CITATION Bar57 \\l 2057 ] Economic-economic analysis of the beer industry. Exhibition of economic growth is evidenced from the increase in production capacity. 40,000 hectolitres was converted into 12.2 cases of beer. Brewing time was tied to beer selling price as some beer require more complex processing time and led to a higher production cost. The beer industry has significantly contributed positively to the economy of Canada since it's an opportunity employer. Indirect jobs include in the production of barley for as a raw material in the beer industry. Famers get the incentive to get an available market of their produce. The government earns revenue from the industry hence adds to government revenue source. [ CITATION Marst \\l 2057 ] Social- digitization trend has helped in marketing the products to the consumer. Social sites ranks among the preference the company uses as its low costly. Facebook, instagram and twitter accounts are active for users. Beer festivals are attended by the company in social events to sell their products. Public consumption of alcohol is prohibited in public. Trends in social media allures to consumers once the products are advertised online. This drives sales growth in the company. (French,Ross,Jeff, 2015 January) Technological -analysis of automation. Automation process should be implemented to cut on cost of production. Quality products after some research on best production policies increases the company competitive edge in the market as it creates a loyal fan base. This comes from innovation from research and development department. [ CITATION Reaer \\l 2057 ] References Alfed, M. (1879 August). economics of industry. London: Macmillan. Bain, R. (1937 December). Technology and State Government,". london: Macmillan. French, J. G. (2015 January). Strategic Social Marketing. London: Oxford press. Spilhaus, A. F. (1994 July). Maps of the whole world ocean." Geographical Review (American . New York: New York Press