Each case analysis will be 8 pages long, double-spaced, in 12-point font. The case analysis must be an ANALYSIS and not a regurgitation of the facts already contained within the case. Also, support should be provided in the form of outside references and an appendix containing financial data/analysis, along with charts and tables.
Please you must follow the following steps to deliberate on the case.
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understanding the case
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identifying the core problem in the case
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analyzing the issues in the context of a theoretical framework
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exploring alternative solutions with reference to a theoretical framework
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choosing the best solution
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making recommendations for action.
Attach the pdf file of the case here:
south delaware coors case.pdf
Download south delaware coors case.pdf
?.I '3 South Delaware Coors, lnc. Larry Brownlow was iust begfuxrfu€ to realize the problem was more complex than he thought. The problem was giving dlrection to Manson and Associates re- garding which researctr should be completed by February 20,zCfilo, to detennine market potentiial of a coors beer distributorship for a two-county arca in south- em Delaware. With daa from this research , I.arty would be able to estimate the feasibility of such an operation before the Marctr 5 application deadline. Larry knew his decision on whether or not to apply for the distributorship was the most irnportant career choice he had ever faced. LARRY BROWNLOIJI' Iarrywas just completing his MBA and, from his sandpoint, the coors announce- ment of expansion into Delaware could hardly have been befter timed- He had long ago decided that the best opportunities and rewards were in smaller, self- owned businesses and not in the fungtes of corporate 8larrts. Because of a fam- rty tragedy some ttrnee years ago, Iarry fouad himself in a position to consider small business opportunities such as the coors distributorship. over ssoo,Ooo was held in trust for Larry, to be dispersed when he reached age 3o. until then, Larry and his famity lived on an annual trust income of about S40,000, It was on this income that l^arry decided to leave his sales engineering job and retum to graduate school for his MBA. The decision to complete a graduate program and operate his own business had been easy to make. while he could avoid such challenges, find an "eaqr' job, and live comfortably using his investment income, Larry knew such a life would not be to his liking. \Forking with people and the of making it on his own, f'arry thought, were thr more preferable than enduring a boriag job and taking an earty retirement. Larry would b€ 30 inJuly, about the time that money would be needed to start the business. In the meantime, he had access to about $t5,000 for feasibility research. vhile there certainty were other places to spend tlre money, tarry and his wife agreed the distributorship oppornrnity could not be ovedooked. Thls case was written by ProfessorJarmes E. Nelson, University of Colorado at Boulder. It is ifit€nded for use as a basis for class discussion ratherttranto illustrate &rher effeafue or ileftctive adminis- trative decision uukiag. Sone daa are dssufsed. Used vrith peardssion, CHAPTTR 4 6PPORTTJNITY ANALYSIS, MARKET SEGMEI'{IATION, A}ID MARIGT TARGETING cooRs, lNc. Coors, history dated back to 1873, when Adolph Coors built a small brewery in Golden, Colorado' Since then, ttre brewery had prospered and become the fou*h-largest seller of beer in the colrntry. ioors' operating philosophy could besummedupas"hardwork,savingmoney,devotiontothequalityofthe product, caring about the- environment, and giving people something to be' lieve in., company operation is consisteot with this philosophy' Headquarters and most production iacitities are still located in Gotden, Colorado, with a new shenandoah, vifgisia, facility aiding in nationwide distribution' coors is still familyopemtdandcontrolled.TheCompanyhad-issueditsfirstpublicstock, tl2Tmillionworthofnonvotingshares,in1gTl,Theissuewasenthusiastically received by the financial "o*-,iniry despite its being offered during a recession' coolE, unwillingness to compromise on the high q"alrty of its product is well known both to it" zuppu.o and to its consuming public. coors beer re- quires constant refrigeration to mainain this quality, and whotesalers, facilities are closely contro[eI to ensufe proper t *p.otot s are maintained' Wholesal- ers rue also requiredio install *a *" aluminum can recycting equipment' coors was one of ttre Rrst breweries in the industry to recyde its cans' IarrywasawaseofCoorspopularitywithmanyconsumersinadiaceltstates. Most beer consumersi considered.Coors beer to be a hish quality, standard beer, haviflgalighqzestyEsteandsimilartostandardbeersfromBudweiserorMiller' However,Coors'corporaternanagernentwasseenbysomeconsutnerstoholdan- tiunion beliefs (nerz-use of a labor disagreement at the brewery some time ago)' Afewother*o**.*perceivedtheu,"w.rytobesomewhatinsensitivetominot- ity iszues, ffmarily ""Jopr"y-""t ga aistritution. The result of these alritudes- plus other aspects of consuher behavior-meant that Coors' sales in Delaware Ioura depend gmtly on efforts of ttre two wholesalers planned for the state' MANSON HESEARCH PROPOSAL Because of the press of his studies, Larry had contacted Manson and Associates in eartyJanuary for their assistance. The fi"n *a" a wilmington-based general re- searctrzupplier that had conducted other feasibility studies in the South Atlantic region. Manson was well known for rhe quality of its work, particularly with respect to compurer modeling. The firm had developed special expertise in mod; eling such things as poputatilon and employment levels -for cities, counties, and othi units of area for perioas of up to 10 years into the future' larryhad metJohn Rome, senior research analyst for Manson, and discussed the Coois oppornrnity and appropriate research extensively in theJanuary meet- ing. Rome promised " f"rrrri darctr proposal (Extribit 1 oa pages 125 z1,,d126) foltn p-;.a that Irrry now held in his hand. It certainly was extensive,Lary thoughq ",,d ,.ft."t.d,the professionalism he expeced. No.ur came the hard particlioo"ing the more rel-evant reseatch from the proposal-because he cer- iainly couldn'iatrora to pay for it all. Rome had suggested a meeting for Friday, gving larry only two more days to decide' ;rry ;* ,i n "t ovemrtretmed- All the researctr would cetainty be usefu1. He was sure he needed estimates of sales and costs in a fotm allowing fi'znage' rial analysis, but what data in what form? Knowledge of competing operations' experience, ,"ailo sPPort, and consurrer accepance also seemed importar* for feasbilityanalysis. nor'example, what if consurrrers were excited about Coors and retailers indifferent or tlre other way around? Finally, several of the studies would sourll DELAVARE COORS, rNC. r25 provid€ information that could be useful in later months of opuation in the areas of promotion and pricing, for example. Ttre problem now appeard more difficult than before! @ iianson and Assodatec Researdr propcal January 15,2q)0 Mr. Larry Brownlovr 1198 Vest laqar Grcster, PL72345 Dear Larry: It was a plearure meetiog you last week and dforussiag your business and research interests in Coors Frorn further thought and discussion wittr my colleaguee, the C-:oors wholesaling opportuaity appsns egen mofie attractirre thaa when we m€t. Appearances car be deeiving, ,rs you kaow, and I fully agree some formal research is needed before you rnake an application. Besearch that we recomrrend would proceed in two distiact stages and is described belw: Stage One Besearch, Based oo Secondary Daa and Manson Computer Models: StudyA: Nationd aad Delaware Per Capia k Consumption for 1998-2fi)2. @t Fer capih armul cun@r of beer fu tE mt pqrdatxr ad po,pulatim age 2l and over in gallons is provided. Source Yarious publications, Manson comput€r model Cosr: fl,flX) &rdyB: Foeukdm Fstiftqtes t6 lffifurTh,o Delacarc C;qmties inltlaftetArea Dwt@tlan: Aonual €stimat€s of total pcpulation aad population age Zl aad orrer are provided for the pedod 1996-2,0fJ6. bnwe: U.S. Bureau of C.enzus, Sales Manageme* Annual Suruey of Bujrlnghwr, Maoson computer mdel Cosr: i1,5OO Sardy G Coom Market Share E*imates for ?.O0h2OO5- fuxtfutfo*; Coors market share for ttre two
ano 2001 N2 w m4 an' tunce Sndy C. Itl 128 @l lcotrtuwedt Thble D Iiquor and Beer Llcence Esdmetes fon MarketAree fur 2fiXl-2OO5 Lterue 2(m z(ru 2UI2 2(n3 2M Alt beveragEs R€tail beer and wine Otr-prEmise beed only Yeierans beer and liquor Praternel Resoft beer and liquor $urez SurdyD. Thble E Delaware Beerfhxeo Paid by BeerVholesalsrs tn the lfiaf,ketAnea, 1997 endl99ft W@r ,D7 Tbx PaU (t) 7998TatckU (r) bnce, StudyE. lYora Deleure$e beer t-r b t0,06 caB per gallon Iable F finandel Statement Sudmary for 51O Vholesalsn of Vlne, Ilquor, and B€€f, tn FtccalYear 1999 Wp Cash aad equiYalents Accorrnts aad uoteg neceiyable, net Invetrory AII ottrer cument tet curcrlt Fixed asse6, net tatangibles, net All ottrer noocurretr Tdal A B C D E F 100-o @| lCondmr,dl fhble E (Contf*nd) E ablltb *ttentaAa Notes gayable, strort+ecm Cucretr long-term debt Accounts and notes p'pble, trade Accrued qenses All other cugent Total current Long+erm debr AII ottre aoncufi€nt Net wordr Total liabilities and net worth It*otre M Net sales Cost of sales Grms proftt Operating €xpenses Operating profit All other exp€rises, net Proft before Axes Rn lG Quick Current DebVwtrth Sales/reeiyables Cost sdes/nventory Perc€oEge profit befote taxes, tased oo total assets 100.o 100.0 Irrtalwtdrur, of Mcrrrcnt $.dr6 firyta: RMA recommeadc dut $taemeot Studies "lafa bc rcgded onty as gwal grridcllncs ard nc as absohrte irdustry norrns. The'e are several rearxn$ sty the a^tq Nry rd be fully reprceotatfta of a gfircn indxtry: 1. The Onandal statemeots used in thc Stam Sardes are not selected by euy raodom or s*ads, dcally diable mefbd- RUA reder banks rolunmdty submit the raw data tiley hane arrailable each year, with the6e b€rtrg the only aorstrahts: (a) Tbe fiscal year-ends of the comlpnies reporteA By not be ft'om Aprit t tbtutgh Juae 29, ad S) ttdr tel asaee mr5t be less rhan ll$ dlHon. 2. ,llafiy hstE varied product llos; llosreyer, the Sarcoet Strdies categptize thern by thefr pimary po&rt Sandard Inerstrlal Chcclffcafion ($lC) mrrber only. 3. Som of orr lt&rstry sarylec are nther smll io relafon to dre to{al nuder of ftrrr in a gircn iodustry, A rehtivdy small saqfle rn itrctre.se the drases ]h?] rooE of our composite & ru fullyrep'resor an tadlstry, 4. Trrqe is the chrne that an erdtre staterrtrt.an be presm in a sq:le, cardng a dqrete inf,ure m t$e Mrstry compoee. Itris is paaiodady tnre ir; retadrrcty-smag sade. 5. Corpanies wtttdn the satre ln&rstry may dtftr in &eir arethod of operations