Free Essay

Brown-Forman

In: Business and Management

Submitted By wandansu
Words 1035
Pages 5
Brown-Forman
Wandan Su
Oct.28th 2012
Managerial Accounting

* Company Overview * Company History In the year of 1870, a great company was founded in Louisville, Kentucky. It was formed by George Garvin Brown, a young pharmaceuticals salesman. He saw the demand for a consistently high quality whisky that conform medicinal standards. Brown and his half-brother used an innovative approach to sold whisky with sealed glass bottles to guarantee their quality while whisky was sold in the barrel in common at that time. The brand called Old Forester Kentucky Straight Bourbon Whisky, was the first bottle bourbon in America, which remains one of Brown-Forman's best selling brands during the current days. The name of the company changed so many times as the business grew and the original partnership dissolved. Later partnership become between George Garvin Brown and his friend also his accountant, so the company was formed was call Brown-Forman. Old Forester sold very well --but In 1902 Forman sold his interest in the Brown-Forman Distillery because he believed that Brown-Forman's success would diminish as soon as the novelty of packaging began to fade. The Brown family bought all of Forman's interest in the company. In1917,George Garvin Brown died and his oldest son,Owsley, took over the Brown-Forman. It was a difficult time because of the depression and prohibitions during the two World Wars. In 1924, the company moved to the 18th & Howard Street, where the company is still headquartered today. Prohibition ends in 1933 and in the same year the Brown-Forman issued their first public stock. In 1945,W.L.Lyons Brown, lead the company to the largest distiller, expand the markets since the end of World War II. In 1960 the company had net sales of exceed $100 million for the first time. In order to expend the beverage business in the world, a new global organization was created called Brown-Forman Beverage World Wide (BFBW). Since then, Brown-Forman supplied the company's brands to the Indian market .Now the company is one of the largest American-owned spirits and wine companies, have 4,120 employees worldwide with about 1,000 located in Louisville. Brown-Forman sells its brands in more than 135 countries and its offices spread many cities all over the world. • Significant Products In all, Brown-Forman has more than 25 brands in its portfolio of wines and spirits.
Brown - Forman owns six main types of brands; Whiskey, Wine, Champagne, Vodka, Liqueur and Tequila. Of course there are many deferent versions in each type of them except Champagne and Wine. For example, Liqueur has so many kinds of products, such like Chambord Liqueur, Jack Daniel’s Tennessee Honey Liqueur, Early Times Fire Eater, Tuaca Liqueur and a series of Southern Comfort. Jack Daniel's is the fifth largest premium spirits brand ,the best selling whiskey in the world,is also the first choice of modulation cocktail. It is known for its square bottles and black label. It is produced by the Jack Daniel Distillery in Lynchburg, Tennessee. Which has been owned by the Brown-Forman Corporation since 1956.Among the Jack Daniel's, Jack Daniel’s Hard Cola achieve great success. The growth rate of the company mainly due to the sales of Jack Daniel's brands. Other famous brands include Southern Comfort , Finlandia , Canadian Mist and Korbel . • Ratio Analysis In addition to discussing Brown-Forman‘s history and products, analyzing their ratios is the most interesting. In the year 2008 the company's debt to equity ratio was 0.64 and increased to 0.66 in 2009. But in 2010, it dropped to 0.51.Since then, the debt to equity ratio decreases all the way to 0.24 in July, 2012. Another one of Brown-Forman's biggest highlights comes from their Return on Equity from total operations which by 25.88% this year. The Return on Equity is not very steady within one year, but fluctuation is not big during the recent years.
Brown-Forman has two kinds of common stocks -- Class A and Class B. Five years ago, the price of BFA is $49.90 and BFB is $39.68. Now the price of BFA has been increased to $60.83 and the price of BFB is $63.60. • Significant Issues As a final point, the overall problem is Overall declining profitability and stagnant sales due to a Problem limited product line Root .The root cause of the problem is the corporate Cause management structure Inserts your sources here. Brown-Forman really operates healthy as a company. The company value of Brown-Forman is 114 billion dollars. In their industries, although Brown-Forman operating rate of the last fiscal year is the lowest compare to the operating rate of the DEO, PORDT and BEAM. But the net profit is not the lowest. For the growth rate of earning per share, Brown Forman is the highest one of their competitors. * Your Opinion As a whole, it seems as if Brown-Forman has always done a good head on its industry. The company is on top for so long that their shareholders are confident with the company and had been a long time. Over many years, Brown-Forman has developed and nurtured a set of core values that have become deeply ingrained in our consciousness and our culture. Brown-Forman is Family enterprise for Brown family owns 67% share of stocks,so it is difficult to be taken over by other big company like Diageo. All of these have come to a conclusion that Brown-Forman is doing an awesome job and developing healthy in the current economies. And I am sure that the company will develop steady in the future.

References
1.http://brown-forman.com/company/
2.http://www.fundinguniverse.com/company-histories/brown-forman-corporation-history/

3.http://ycharts.com/companies/BF.B/debt_equity_ratio
4.http://finance.yahoo.com/q?s=BF-A&ql=1
5.http://news.imeigu.com/a/1324513867025.html
6.http://www.slideshare.net/smscarbr/brownforman-corporation-strategy-assignment
7.http://www.forbes.com/
8.http://www.cnbc.com/
"Brown-Forman: Major Holders- Yahoo! Finance" <http://finance.yahoo.com/q/mh?s=BF-A+Major+Holders>

Similar Documents

Free Essay

Brown Forman Differentiation

...I. Current News On February 1, 2010 Brown-Forman stated it is planning to establish its own distribution company in Germany starting in the third or fourth quarter of 2010. Germany plays a role in international sales and having a fully-owned sales and marketing operation will greatly help Brown-Forman’s sales. Brown-Forman should gain a competitive advantage in Germany because they will no longer need a distributer. By being able to sell and market its own products Brown-Forman should have increased international sales in Germany. (Brown-Forman News, 2010) On January 15, 2010 Brown-Forman announced its plan on giving up to $100,000 to American Red Cross to assist in the relief efforts. Brown-Forman also said it will match employee donations up to $20,000 for American Red Cross, which means the company and its employees will contribute as much as $140,000 to the Haitian Relief efforts. This kind of charity is good public relations for the company. It shows Brown-Forman is more than just a company that cares only about their net income and sales. Because there are many companies in the same industry who haven’t done anything for Haiti, people could be more likely to buy Brown-Forman’s line of products knowing that the company donated money. (Brown-Forman, 2010) In 2009, The Brown-Forman Corporation achieved the highest year to year score increase among all companies rated by the Human Rights Campaign. The Human Rights Campaign is America’s largest civil rights...

Words: 1073 - Pages: 5

Premium Essay

Case 51: Brown-Forman Distillers Corporation

...Case Study 4: Corporate Valuation Case 51: Brown-Forman Distillers Corporation 1. Why is Brown Forman considering buying Southern Comfort? In your answer consider the strategic motives of Brown and the arguments in favour of and against the acquisition. Producing and selling high-quality products is the company’s marketing philosophy. Although Brown-Forman was the fifth-largest distiller in the United States, it spent a lot of money in advertising support in order to build best brands in the world. In a while, the whiskey market was in a depression. Brown- Forman faced a big challenge to overcome this period. In order to expand its product lines, Brown-Forman chose several of products which has fast growth in the alcohol beverage market. So the company can expand its product lines. In addition, during the 1978 to 1980 period, the company invested $86 million in advertising and promotion, $39 million in barreled-whiskey inventory and $19 million in fresh plant and equipment. The company was aware of that the foreign market also was important for the later growth of company. Advantages: The Southern Comfort can provide a variety of products to customers. After this acquisition, the earning per share and share value of stakeholders value will increase. The profit/sales ratio is high. So the company can make more profits. The average assets/sales ratio also is high. Therefore, the company can make more earnings and produce......

Words: 1017 - Pages: 5

Premium Essay

Brown Forman Analysis

...Analysis for Brown-Forman Strategic Analysis — MBA 601 Dr. Robert Nixon Prepared by the Blue Team: Alexandria Lovan Ryan Melander Michael Miao Cipriana Prepeliuc Jasleen Sethi Table of Contents Type chapter level (level 1)1 Type chapter level (level 2)2 Type chapter title (level 3)3 Type chapter level (level 1)4 Type chapter level (level 2)5 Type chapter title (level 3)6 BACKGROUND Brown-Forman, headquartered in Louisville, KY, is one of the largest producers of wine and spirits in the United States and one of the leaders in whiskey production worldwide. Founded in 1870 by George Garvin Brown, a pharmaceutical salesman, Brown-Forman has grown into a leader of high-quality spirits and wine around the world. Beginning with a single brand, Old Forester, the company acquired Jack Daniel in 1956, Canadian Mist in 1971, Southern Comfort in 1979 and many other premium alcoholic beverage brands throughout its 144 years of existence. In addition, Brown-Forman acquired Lenox in 1983, a producer of crystal, china, and luggage. In the 1990s, Brown-Forman began aggressively marketing internationally and saw a steady increase in its global market share of premium liquors. However, the consumer product division of Brown-Forman did not see the same growth and the company eventually sold the Lenox division in 2005. Today, Brown-Forman is a publically traded company, predominantly with 33 brands of premium wine and spirits sold in 135 countries(I found in the 2014 annual report that it`s...

Words: 2756 - Pages: 12

Premium Essay

Brown-Forman Analysis

...Brown-Forman Analysis ACC/300 Brown-Forman Analysis George Garvin Brown in Louisville, KY, founded Brown-Forman in 1870 and they produce vast array of wines and spirits. The products are high quality and still include Old Forester Kentucky Straight Bourbon Whisky the company’s first product. It was America's first bottled bourbon and remains one of Brown-Forman's finest brands today. Brown-Forman has on staff over 4,000 people worldwide, with their global headquarters in Louisville employing approximately 1,000 people. They are not only one of the largest American-owned spirits and wine companies but they listed in the top 10 largest global spirits companies. What started as a young salesperson idea to sell top grade whiskey in sealed glass bottles has now flourished in to a company with sales of $3.8 billion dollars (BROWN-FORMAN Our Company, 2012.) The following will contain information on the organizations most recent financial statements. Corporate debt Securities A debt security in finance is when a lender such as a bank or corporation lends money to an interested party looking for financial gain in the form of bonds. Debt securities are interesting because they serve the purpose of creditors who loan money to a borrower and accrue interest to sell them. They have value. For example, a creditor creates a binding agreement with a borrower listing all the financial terms for loan payment in the form of a contract in which will carry value......

Words: 1289 - Pages: 6

Premium Essay

Brown-Forman Distillers Corporation

...In early July 1978, W. L. Lyons Brown, Jr., president and chief executive officer of Brown-Forman Distillers Corporation, faced an important acquisition decision. The principal owners of Southern Comfort Corporation had approached Brown in May with an offer to sell the company at a price of $94.6 million. In preparing his response, Brown was evaluating the feasibility of the asking price and the likely effects of the acquisition on Brown-Forman’s share price. As a leading producer, marketer, and importer of wines and distilled spirits (including the well-known Jack Daniel’s brand), Brown-Forman ($457 million net sales) was the fifth-largest distiller in the United States, after National Distillers ($586 million), Seagram ($2,018 million), Heublein ($839 million), and Hiram Walker ($875 million). How Brown had chosen to position Brown-Forman among its competitors would affect the appraisal of Southern Comfort. Brown-Forman: Financial Goals and Performance In 1977, Brown-Forman’s management adopted new long-range financial goals regarding: (1) hurdle rates for investment; (2) size of the capital budget through 1980; (3) target capital structure; and (4) dividend payout. The primary objective of these goals was to “increase the value of the stockholders’ investment.” The dividend payout ratio (all dividends paid divided by net income) was targeted at a range of 30% to 35%. Planned investment during the 1978 to 1980 period included $86 million for advertising......

Words: 4348 - Pages: 18

Premium Essay

Mentoring

...• Why do some organizations achieve great success in rolling out a mentoring program, while others achieve only a modicum of success? We believe that the companies that are most successful view corporate mentoring as an organic process, meaning that they understand that mentoring programs evolve and grow. Our experience demonstrates that the difference between mentoring success and failure lies in the ability to build capacity and integrate learning continuously. In order to create a successful mentoring program, you should answer 20 questions. We've included dos and don'ts for each, based on research and our experience in developing a mentoring program at Brown-Forman Corporation. 1. What are our business reasons for developing a mentoring program? You should develop a mentoring program if and when you have solid business reasons, such as to speed up the development of future leaders or to share organizational knowledge. Do your homework. Look at employee retention rates, the percentage of senior managers who will reach retirement in the next five to 10 years, current bench strength, and developmental objectives. Don’t develop a mentoring program because it’s popular or because you've read that it works for other companies. 2. What organizational support exists and what needs to be developed? Successful mentoring initiatives require visible support and involvement from the highest levels of the organization.......

Words: 3109 - Pages: 13

Premium Essay

Paper

...Management 600 Dr. Luce Blake Herner Brown –Forman Corporation Founded by George Garvin Brown and John Forman in 1870 Brown- Forman is now one of the largest competitors in the alcoholic beverage market within the United States. The company is headquartered in Louisville, Kentucky and is still family owned to this day. While the company sells a wide variety of products they are specifically known for their wine, spirits and whiskeys. Under an umbrella of roughly 25 distinctive brands “Brown-Forman Corporation is a diversified producer, marketer, and exporter of alcoholic beverage and consumer products”. Their top sellers are “Jack Daniel's whiskey, Southern Comfort liqueur, Canadian Mist Canadian whiskey, Early Times and Old Forester bourbon, Glenmorangie Scotch, Finlandia vodka, Korbel champagne and brandy, and Fetzer, Bolla, and Sonoma-Cutrer wines” (1) www.fundinguniverse.com/company-histories, Organizational Change and strategic Bourbon was the original product Brown-Forman produced and sold giving theirs the title of ‘ Old Forester’, which is still in production today. Bourbon was traditionally sold by the barrel directly from the distiller to the retailer. At which point the bar or pub would transfer the bourbon into there own bottles. Recognizing this opportunity and understanding the power of marketing using a differentiated approach, Brown-Forman began bottling ‘Old Forester’ making sure each was corked and sealed. This was the first marketing...

Words: 488 - Pages: 2

Free Essay

Jack Daniels

...brand is produced by the Brown-Forman Corporation. Brown-Forman produces and markets many of the most well-known and best-loved wines and spirits in the world. Some of their popular spirits include Jack Daniel’s, Canadian Mist, Southern Comfort, Gentleman Jack, and Early Times. A few of their wine labels include Fetzer, Bolla, Bel Arbor, and Michel Picard. The Brown-Forman Corporation is one of the largest American-owned companies in the wine and spirits business. They are considered a top diversified producer and marketer of fine quality consumer products within their industry. Headquartered in Louisville, Kentucky, Brown-Forman was founded in 1870 by George Brown and John Forman as small town distillery producing Old-Forester brand bourbon. They compete in the distillery industry that includes about eighty companies with combined annual revenues of $ 6 billion. Today, the company employs approximately 3800 people in the U.S. and abroad. For fiscal year 2008, the Brown-Forman company had sales revenue of approximately $ 3.3 billion with a net income of $ 440 million. In 1956, Brown-Forman purchased the Lynchburg, Tennessee-based Jack Daniel’s. They maintained the simple black Jack Daniel’s label. The Brown-Forman Corporation has found global success by introducing Jack Daniels to overseas markets. The Jack Daniel’s product is the company’s leading brand and is the largest selling American whiskey by volume in the world. Brown-Forman has been able to grow......

Words: 423 - Pages: 2

Free Essay

Analyzing

...Boston Photographs,” the author Nora Ephron shares one of her selections from her collection Scribble, Scribble: Notes, on the media (1978). This selection was a response to the “The Boston Photos,” that were captured by Stanley Forman, from the Boston Herald American who used a motor –driven Nikon set at 1/250, 15.6-s. Ephron tries to inform and persuade the readers on why those Boston photos should be publish and why all photos make great journalism and she accomplish those things. With that being stated, her thesis and purpose of this selection is that photojournalism is better than written journalism. Ephron explains and give her opinion and others opinion on why and why not these Boston photos that were token around the 1930’s should or shouldn’t be publish for the public eyes. The audience of this selection would be students that major in photography or journalism, and on the other hand people who read the newspaper on the daily. Ephron starts her selection off by giving the reader background information on the Boston photos. She did not leave the audience guessing on what she was talking about. These pictures were taking while a firefighter was trying to save a young women’s and child’s life during an apartment fire. The photographer, Stanley Forman did not know the ending outcome of that failed rescue. As he took the photos you see the firefighter grabbing the ladder as the young women and child were felled unto the ground. The young women failed to her death......

Words: 739 - Pages: 3

Free Essay

The Differences Between One Flew over the Cuckoo's Nest; Novel vs Film

...One Flew Over the Cuckoo’s Nest Many classic novels have been adapted into movies. However, to the avid reader, in many cases these movie adaptations often seem to fall short of the novel’s true meaning and depth, causing so many movie-goers to say, “The book is better.” Due to time constraints movies often cannot fit all of the detail that a book contains and can easily fall short of the expectations readers may carry seeing the film version of a favorite novel. In the case of One Flew over the Cuckoo’s Nest, written by Ken Kesey, some key differences are created by the director, Milos Forman, both in the interest of time and to create a more fast-paced feel for the movie viewer. While several differences exist, the three most significant are in that of the characters, the overall development of the ward in which these men live, and in the point of view created by the novel’s eyes and ears, Chief Bromden. Randle Patrick (R.P.) McMurphy shows up early in the story as a brash, large redheaded man, sporting curls under his cap and broadness in his frame. In the novel he is portrayed as a large, sun-kissed man who has spent his days on the work farm, serving a sentence for crimes committed. However, within the first minute of the movie the viewer is introduced to this same character in the form of Jack Nicholson, who holds almost none of these physical characteristics. There is minimal effect on the viewer however, as Nicholson portrays the role admirably, shining in......

Words: 1317 - Pages: 6

Free Essay

Some

...ED 292 TEP Presentation TEP Essay Audience * 2 People / Interview team * PhDs / Ed Ds * You don’t know them (maybe) * Determining your future * Experienced Educators For your essay, this knowledge means that * your essay should sound educated, professional * your essay should be concise, to the point * you should know your content * 7 Dispositions * 6 Conceptual Framework commitments * Why you’d be a good teacher * life experiences that demonstrate CF and Ds * P-12 connection, * Your essay should have 3 or fewer grammatical errors Purpose * to prove we know what we want for our future – to be educators * to seek entry into TEP * to fully integrate CF & Ds into lived experience For your essay, this means * You are writing a persuasive essay * 1st Person is required (you can’t talk about yourself as if you are someone else) Thesis * Will emerge from the organization options below Organization * Content * 7 Dispositions * 6 Commitments of the Conceptual Framework * Personal Experience (activities including work, school, church, scouts, sports, family) * Possible Organizations * 5 paragraph theme (3 points) * 3 Content Categories * 3 Dispositions * 3 Conceptual Framework Commitments * 3 Combo (Disp/CF/Pers. Exper.) * 3 Experiences (Best Option) * 1 Experience w/3 Aspects ......

Words: 359 - Pages: 2

Free Essay

Sea Creatures

...neurotoxic venom can cause death. This has allowed it to hunt and feed itself. The Man o’ war The Portuguese man o’ war also has tendrils that are covered in venom-filled nematocysts used to paralyze and kill fish and other small creatures. Muscles in the tentacles draw prey up to a polyp containing the gastrozooids or digestive organisms. 2. Color Complexion Animals have different skin colors that serve many purposes. At times they guard the animal from danger by camouflaging it from the view of a possible hunter where at times it severs as a warning to other animals that keeps them from approaching the specific animal. Anglerfish The Anglerfish is able to blend into the darkness because of its dark grey and brown color. Therefore, it is able to hide itself from possible predators. Starfish Many starfish wear striking colors that camouflage them or scare off potential attackers. They use color, pattern and texture to camouflage on sand, coral, rocks and the ocean floor. Some starfish also have the ability to change colors to camouflage themselves from other enemies. Octopus The octopus has smooth skins and special...

Words: 963 - Pages: 4

Free Essay

One Way to Get Off

...biting into the flesh of my wrists. A moan came from the cubicle next to me. I could feel a frisson of fear surging inside of me, gnawing away at my soul. Terrified. I asked in a trembling voice; “Who are you?” A startling voice replied back; “I am Irene. I do not know how I came here” Soon enough my hands were free, and the doors to the cubicle drastically opened. Light shone on Irene’s face, her eyes glistening and her brown hair shining. She wore a shaggy, black button down top and dirty work boots. She seemed frightened from the darkness, but her skin was so porcelain, both pale and perfect. I couldn’t get over the fact that her face looked like a perfect china doll you’d purchase at an antique store. Her lips were a glowing red, and her jaw was so pointed, falling perfectly with her diamond shaped face. Her forehead was rather wide, her eyes almond, her noise pointed and her mouth, a cupid’s bow. Her teeth were perfect. And she had very high cheekbones. Her face would get the attention of anybody, but her clothes were such shabby things. But her wiry brown hair made it all fit together. “Good evening” A deep dark voice appeared out of the darkness. A faint shivering ran through me. I felt a dreadful sinking pain at my heart, such as I had never felt before. “Who are you?” I questioned in a state of nervousness. “MY IDENTITY DOES NOT CONCERN YOU!” The loud, booming voice seemingly shook the room. I was frightened. The voice...

Words: 1365 - Pages: 6

Premium Essay

United Parcel Service Culture

...relevant in the one hundred plus years since it was founded, but how has it remained amongst the top performers in this field? The organizational culture of the company may be able to answer this. The Cultural Artifacts of UPS The artifacts of the United Parcel Service are many and varied, but one above the rest stands alone, that being the color brown. The color itself has been used in much of the other symbology and artifacts of the shipping giant. UPS uses a specific shade of brown which is called Pullman brown. At the time of UPS’s inception in the early twentieth century the height of luxury cross country travel was done by rail. The most luxurious of all the rail line cars were made by the Pullman Palace Car Company, as such brown was associated with luxury. One addition benefit of the color brown for over the road vehicle that frequently travels unimproved roads is that it easily hides dirt and road grime. The color brown has been used in the as a major portion of the marketing strategy of UPS, even so far as using it in a very successful slogan, “What Can Brown Do For You?” You can find their distinctive Pullman brown color in almost everything UPS related, from the uniforms the employees wear, to the vehicles that they drive. Another unique artifact of the...

Words: 1721 - Pages: 7

Premium Essay

Arnicare Analysis

...Sensory marketing Level of emotional impact increases when involving multiple senses - enhance the product experience and increase loyalty. • Smell (customer smell the product to see if it is bearable) Fact: fragrance free, barely has sense of herb Improve: 1. Arnica Montana is a yellow and daisy-like flowers, a pleasant and congruent mint or floral scent can improve consumers’ ability to remember brand names and packaging. 2. Can try to enhance the herbal sense to deliver the information that Arnicare has high concentration of effective ingredient • Visual Fact: no color (crystal clear) Possible improvement: 1. Arnica Montana also named mountain daisy, some yellow color or light brown color might enhance the user experience 2. Option: the light blue or green color to comply with the package • Touch (focus on gel but Arnicare has cream, ointment and other texture) Fact: for Arnicare gel, it is non-sticky, non-greasy, jelly-like material, relatively soft and weak to other similar products Possible Improvement: 1. make the gel harder and tougher to provide the customer a sensory idea that the active ingredient is concentrate and the product is more effective compare to similar product 2. Enhance the cooling effect Is the package attractive? For my personal experience, the ice hot package is more attractive and appropriate, it uses the two different but congruent colors on the package to offer a direct feeling of words “ice” and ‘Hot”. Ben...

Words: 376 - Pages: 2