Question
The Board of Directors of Boston Beer Company has employed you as a consultant to assess the company's current situation and recommend a set of
The Board of Directors of Boston Beer Company has employed you as a consultant to assess the company's current situation and recommend a set of actions to maintain the company's current growth in revenues and profitability.The Boston Beer Company's Board of Directors that sets performance targets and makes action recommendations that the company needs to follow to meet the aggressive revenue and earnings targets set by you, the consultant. There were clear signs that the company was on the right track.
Writing to the company's shareholders in Boston Beer Company's Annual Report, Jim Koch, Chairman and Founder of Boston Beer Company, had this to say about annual 2018 results:
"We're happy to say that 2018 was a year of rapid expansion and our sales increased by double digits. We may have made it look easy, but this kind of rapid expansion doesn't happen without bumps and challenges."
Maintaining double digit levels of annual sales growth and profitability for the company was a very challenging task. There were very clear signs of saturation in the U.S. craft brew market, and sales of Alcohol-Added Seltzers (Truly Hard Seltzer) and Alcohol-Infused Teas (Twisted Tea) for Boston Beer Company had become a fast-growing part of overall sales.
Boston Beer management was also concerned with a sales slowdown in their core craft beer products, such as Samuel Adams beer. As the company's consultant is to make recommendations that maintain the company's strong annual growth and positive earnings.
(1) Setting revenue targets for 2020 and 2021 that meet or exceed 20% growth,
(2) Setting Earnings per Share (EPS) targets for 2020 and 2021 that meet or exceed 20% earnings growth
(3) Making two recommendations that make it possible for the company to achieve these ambitious revenue and EPS targets
(4) Making one recommendation that returns the core craft beer brands to positive sales growth.
(a) an analysis of the company's financial statements and/or pro-forma financial projections
(b) Use Excel and forecast the growth of the value line projections for 2020 and 2021
This recommendation can focus on 1 Boston Beer product line (e.g. Samuel Adams, Dogfish Head Brewery, etc.) or can cover multiple product lines for the company.
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