...Field Project – Cottrell Brewing Company Cottrell Brewing Company was established in 1996 by Charles Cottrell Buffum Jr who always had passion for beer. He first started to make his beer at home and was visiting a lot of brewing companies and learning what was involved in the process. Eventually began volunteering at the Ipswich Brewing Company and that has inspired him to open his own brewing business. He found a mill in Pawcatuck as a perfect place for his new company where also his great-great grandfather had his started his Cottrell Printing Press business. Since then, Cottrell Brewing Company has been family owned by Charles and his wife Ann and is a choice for many businesses in Connecticut and Rhode Island. The business mission is to provide to its customers, fresh and full of character beers at the top of their class. The owner believes that success lies in providing beers to a particular beer market. The idea is a small, regional, niche market with a focus on customers which enjoy craft brewed, quality beers, as opposed to a large mainstream high volume business catering the majority of the beer drinking public. The process of brewing beer, whether it is on a large scale or small, is the same. The main components of direct materials used to produce beer are; hops, barley, select spices and water. Because these ingredients are grown naturally and supply can changes based on growing conditions, they are a commodity, resulting in price fluctuations depending on demand...
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...focusing on the beer market as a whole would allow an observational look at the process of the supply chain for most beer manufacturers. The vagueness of not pointing out a specific brand also results from the secrecy most brand names keep around their business practices and a lack of researchable information made available online. The Manufacturer Overall the supply chain is everything included in the management of getting the goods, in this case, the beer to the consumer. As with most production processes the manufacturing of beer begins with gathering the raw materials. The raw materials necessary for the production of beer are barley, yeast, hops, and water. Therefore, manufacturers must maintain a partnership with farmers and suppliers that produce the necessary ingredients and also ensure the water supply utilized in the process is untainted. Furthermore, beer producers must maintain sustainability ensuring the ingredients are available well into the future. Once the ingredients are accounted for, and the demand for beer, which is relatively high around the world, is determined, the production begins. The production process can take on average thirty days to produce a batch of beer ("Anheuser-Busch", 2015). Manufacturers also invest heavily in advertisements to ensure their product remains the product of choice to the millions of consumers in the market. Beer advertisements can be found in numerous places, such as grocery store displays, beer shipping trucks...
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...existence. Finding the balance between staying profitable while constantly adapting to the changing economic and customer driven demand environment will be the key to the expansion of the craft brew business. New Companies and Mergers The idea of new competition is the boost to get the current company to step their game up. DogHead Fish Brewery is successful and growing steadily. The rapid emergence of nano-breweries has redefined the standards of craft beer. Good just doesn’t cut it anymore. It has to be bold, smoky, spicy, “hoppy,” citrusy, sour, fruity, one-of-a kind and more. If you just want to drink good beer, you are in for a treat. Are these many breweries sustainable in the long run? The research has shown that craft breweries are growing in record numbers. The market is ripe for it. The consumer base is also expanded beyond the college student to the beer drinking connoisseur. In recent years, craft brewers have sounded an alarm over the clout of Anheuser-Busch Inbev and MillerCoors, who today control 90 percent of the beer market. Craft brewers hold just 6 percent, but the market share is growing (Hieronymus, 2010). "Their preferred business model is an oligopoly," says Koch of the company that was once interwoven with his family. "I don't see them as trying to deliberately set out to destroy us. But we are very potentially the collateral damage." Oligopolies are small groups of firms that control a particular market. DogFish Head Brewery fits this description perfectly...
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...Business 2000 SIXTH edition On top of all this a new beer was challenging the traditional beers. This beer contained roasted barley, which gave it a characteristically dark colour. The brew was known as "porter" because of its popularity amongst the porters at Covent Garden in London. Arthur Guinness’s strategy was to tackle the English brewers at their own game. He brewed the deep, rich beverage so well that he eventually ousted all imports from the Irish market. Not only that, he even began to capture a share of the English market. By 1825 Guinness Stout was being sold abroad, and by 1838 the St. James Gate Brewery had become the largest in Ireland. Its growth continued, with annual production of more than one million barrels in 1881, and by 1914 St. James's Gate was the world's largest brewery. At the milling stage the malt is crushed.The crushed malt is mixed with flaked barley Mashing and roast barley to give a substance called grist. The Copper Boiling grist is weighed and fed into a mash vessel along with hot Fermentation water and mixed thoroughly at approximately 65 degrees Maturation celsius.This process results in a porridge-like consistency, Bright Beer Tanks which is then passed through a sieve. The sugary liquid which results (called wort) is transferred to the copper kettle, while the grains which are left behind in the sieve are sold as cattle feed. Milling QUALITY IN PRODUCTION Introduction Producing a consistently high quality product is one of the key...
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...To: Board of Directors of Caribbean Brewers Inc. From: Comptroller, Caribbean Brewers Inc. Subject: Production Costs, Performance Management System, & Income Tax Audit Risks Date: Background In 2005, the Gera International conglomerate purchased 75 percent of the common shares of an Antiguan brewery, the producer of “Tigua” beer. The Antiguan brewery was renamed Caribbean Brewers Inc. Three years later, the production facilities at the brewery were expanded, and the production capacity doubled. In 2009 and 2010, sales volumes of Gera beers increased dramatically. Although production systems and processes have not changed since the acquisition, Caribbean Brewers’ costs of production have also increased significantly. As a result there has been growing dissatisfaction amongst production employees, especially those whose compensation is linked to the supposed production inefficiencies and rising costs. In addition, Caribbean Brewers Inc. has received a letter from the Inland Revenue Department of Antigua informing us that our tax filings for the years ended December 31, 2008, 2009 and 2010 will be audited at the end of the month. Purpose The purpose of this report is to: • Assess production costs to determine if they have been properly allocated, • Analyze the current performance measurement system, • Determine if Caribbean Brewers Inc. has been compliant with Antiguan tax laws, and • Recommend solutions to overcome declining...
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...Caribbean Brewers: Transfer Pricing, Ethics and Governance Abstract Caribbean Brewers is a fictitious company although the case depicts a real international business situation focusing on transfer pricing, ethics and governance. It exposes students to the role of management accounting concepts such as cost allocation and transfer pricing in terms of how they impact the performance and reward of individuals at different levels within the organization. Students are also exposed to impact of the management accounting and control tools/methods used upon stakeholder interests. The case puts the new comptroller in a difficult position with respect to discharging his or her professional and ethical responsibilities when the interests of the different stakeholders are at odds with one another (e.g., majority and minority shareholders, individual managers and tax authorities). It contains a good balance of quantitative and qualitative analyses, and forces students to delve into the issues in some depth. The ethical issue forces students to think hard about how they would react when facing similar situations. The case offers considerable flexibility to the instructor to emphasize different aspects contained within depending upon the specific course and the level at which it is being used; it can also work well as an integrative case. The case is most suitable for use in advanced undergraduate management accounting courses as well as graduate level courses including those in...
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...of products or service of your chosen organization, and two (2) key factors in the organization’s external environment that can affect its success. Provide explanation to support the rationale. De Beers Diamond Company is an industry that currently produces $13 billion worth of rough diamonds each year, leading to the employment of 10 million people globally from mining to retailing. 70% of rough diamonds are sold for industrial purposes with the remaining 30% “gem quality” being distributed to experts for cutting, polishing and jewelry manufacturing (Stein, 2001). The global jewelry market has increased three-fold in the last 25 years and is currently worth $72 billion each year. Jewelry diamonds are unjustifiably expensive given that they are not actually scarce. Upon the discovery of other diamond reserves globally, De Beers set up a subsidiary called the Central Selling Organization (CSO), responsible for buying the production for all mines worldwide then selling the produce to dealers in return for a percentage fee (10 – 20 %) from producers (Stein, 2001). The CSO was able to maintain illusion of scarcity by deciding the quantity of diamonds to be supplied to the world market and in turn, allowing individual producers to produce a certain percentage of that amount (De Beers Group, 2012). The CSO then sold batches of rough diamonds to selected dealers at their exclusive sightings. The CSO were able to dictate inflated prices to dealers, as if dealers tried to negotiate on...
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...extremely important for the Mexican economy, but at that bad moment of the country, Fomento Economico Meixano (FEMSA), which is the controller of Cerveceria Cuauhtemoc-Moctezuma and grupo Modelo were achieving an important position between the first 20 places of the best companies. In this last years both companies continue growing and not only their competition is at a national level, now their competition is also in the foreign market. For this, FEMSA join with the foreign beer company Heineken in order to distribute in the United States the products Tecate, Dos Equis, Sol, Carta Blanca y Bohemia. With this both companies will have the 26% of presence of the exported beers in the United States market. Also this will help the company from Monterrey to strength his competition with Grupo Modelo. The main reason for Cerveceria to look forward this types of joints with other companies is to expand their market to other countries and with this over pass their competition. * The beginning of the beer industry in Mexico The beginning of this industry took place during 1880 – 1910 together with the beginning of the modern industry “porfiriana”. It was a period of time were big companies started to establish and as they needed a good amount of money for investment they were established as anonymous societies for legal terms. At this period the main companies of cigarettes,...
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...consume the products of the company, we should learn more about the goals and business strategy in order to gain the advantage, as well as to capture the market and understand customer behavior. Those are important factors in the business environment. For the Heineken beer company, all of the above concepts are to be demonstrated and put out clear strategies for the marketing of products on the environment. Task 2.1 *Micro environment is the environment includes factors that exist with the company and those affecting the ability to serve clients of that business and is a combination of craft and the scientific method to improve the company looking good products and the direct relationship of the company, then produced and provided about the possibility of serving the company. Micro environment consists of six steps. +Company is where you work, manufacturing and especially the problems related to marketing management. The senior management of the business is the people who have the influence to the activity of the company, by the most active marketing strategy must be adopted before they go into effect. Heineken beer is famous brand all over the world. Heineken beer is currently rated as the best Brewers of beer compared to the market in the country. Because of the strong on ensuring quality and delicious taste, for years Heineken...
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...measurement system has changed immensely. Presently, the production personnel can earn a bonus if production costs do not exceed 43% of sales. In the past, the bonus was based on a combination of average total production costs and quality control, which has since been eliminated. This change in performance measurement has also affected JJ’s benefits, eliminating his annual dividend, and decreasing his ownership in the company from 25% to 8%. Cost Control JJ, the production manager, is extremely displeased with the new performance measurement system for a variety of reasons. Regarding costs, the production personnel’s bonus is based on many factors which are out of their control. The production facilities were expanded in 2008 in order to double production capacity. Since the expansion, the plant began producing Gera beer as well. As a deposit cannot be collected on exported Gera beer bottles, all bottling costs are expensed and charged solely to Caribbean Brewers Inc., resulting in a cost increase of over $6.1 million in 2009. Depreciation is also included in determining total production costs as a percentage of sales for bonus purposes. As a result of the plant expansion, depreciation has increased, resulting in greater overhead and therefore more overall production costs. Management was behind the decision to double the plant size and thereby increase depreciation costs. These new costs cannot be controlled by production personnel. There are also quite a few other fixed costs...
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...Computer Integrated Logistics (CIL) project to improve its supply chain management. Coors defined its supply chain as every activity involved in moving production from the supplier’s supplier to the customer’s customer. (Since by Federal law, Coors cannot sell directly to consumers, Coors customers are its distributors whose customers are retailers whose customers are consumers.) Coors supply chain included the following processes: purchasing, research and development, engineering, brewing, conditioning, fermenting, packaging, warehouse, logistics, and transportation. This CIL project was a cross-functional initiative to reengineer the business processes by which Coors logistics or supply chain was managed. This reengineering project improved supply chain processes and applied information technology to provide timely and accurate information to those involved in supply chain management. The project objective was to increase company profitability by reducing cycle times and operating costs and increasing customer (distributor) satisfaction. The software vendor used for this project was the German company, Systems Applications & Products (SAP), 1 that provided the financial and materials planning software modules. The SAP planning software became Coors load configurator software that takes distributor demand forecasts and the production schedule and creates a shipping schedule for the following week. The following major supply chain problems were corrected by this CIL project: 1...
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...Report Madison Martin 500674085 Ariana Mazzariol 500624719 Nick Natale 500653626 Evan Raelson 500653626 Mariam Ahmed 500630579 Ankit Kumar 500632601 Steam Whistle Brewery is located in the historic John Street Roundhouse, just south of the CN Tower in Toronto. The brewery consist of manufacturing, sales, and marketing departments which includes approximately 170 employees. The facility is about 50,000 square feet consisting of production, retail, event, and office space. They supply their beer to men and women of the legal drinking age in Alberta, British Columbia, and Ontario. Steam Whistle uses a hybrid manufacturing process, producing approximately 88,000 bottles per day. They are working at integrating many green initiatives such as using all natural ingredients, reusing bottles and elements from the packaging line, and reducing paper usage in the office. Steam Whistle specializes in the “art” of beer creation by utilizing an integrated facility of both human labour and machine processing. In various aspects of the brewing process Steam Whistle is evidently applying a large dependence on the human labour which may not always be profitable in the long run. As discussed throughout the course, human capital in operations is essential for running a business smoothly but under differentiated circumstances, human labour can be considered a liability for a business. Humans act and work independently from one another and each person has different capabilities. Labour costs...
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...ACCT102 Management Accounting G8, Group 5 Executive Summary Introduction of Beer Business Costing Technique Chosen PROCESS COSTING 1 2 2 2 Assumptions Processes of Manufacturing Beer DEPARTMENT ONE: STAGE 1 - MIXING DEPARTMENT ONE: STAGE 2 - BREWING DEPARTMENT TWO: PACKAGING 3 4 4 4 5 Process Costing DETERMINING FIGURES CALCULATING COST PER EU 6 7 8 Cost Reconciliation Recommendations CAPPING & LABELLING BOTTLES & UTILITIES TRANSPORTATION 9 10 10 11 11 Introduction of Outpatient Business Costing Technique Chosen ACTIVITY BASED COSTING (ABC) JUSTIFICATION 12 12 12 12 Assumptions List of Activities and Cost Drivers Traditional Costing COMPARE AND CONTRAST WITH ABC UNDER ABC METHOD UNDER TRADITIONAL COSTING METHOD 13 13 14 14 16 16 Recommendations Conclusion Learning Points Reflections Bibliography Appendix 1 (Heineken) Appendix 2 (SATA CommHealth) 18 20 21 23 24 25 27 ACCT102 Management Accounting ! G8, Group 5 EXECUTIVE SUMMARY ! Our project aims to apply costs concepts in the beer manufacturing and hospital service industry. The companies we will be using for our case studies will be Heineken and SATA CommHealth. We will seek to identify the most suitable cost concept for each industry to allow for better internal decision making purposes. Various costing methods, namely, Activity-Based Costing and Process Costing, will be used to analyse the business models of these companies in the aforementioned...
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...brewery that was founded in 1870 by Joseph Meens. The brewery is located in Schinnen, a town located in the southernmost province in the Netherlands. It is still owned by the Meens family and is now led by the 4th Meens generation. Initially, Alfa beer was only sold locally, but since 1960 it has been available throughout the Netherlands. In 1993, Alfa Brouwerij began exporting to the United Kingdom, the United States, Germany, Greece and Italy. The water that is used to brew the beer is extracted from an underground spring. The Dutch Ministry of Health, Welfare and Sport has officially certified the spring, meaning that the water is pure enough to enter the brewing process without undergoing any processing beforehand. As only 15 million liters of water are allowed to be withdrawn from the spring each year, Alfa limits its beer production. This has led them to number their beer bottles to ensure that only the permitted amount of water is used. Product The Alfa brewery makes 5 different beers: Oud bruin (Old Brown), Edel pils, Lente bok (Spring bock beer), Dortmunder, Bokbier (bock beer). The focus of this situation analysis is on the Edel pils. The Edel pils is a part of the (Czech) pilsner beer family which is the most widely consumed beer in the world. It contains 5% alcohol by volume. Edel pils is available in different packages: 0.33 L and 0.5 L cans, 0.3 L and 0.5 L bottles, and 20 L and 50 L barrels. Market Definition In order to clarify the relative position of Alfa in...
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...DeBeers “A Diamond is Forever” Prepared April 16, 2012 For decades, De Beers has been the preeminent name in diamonds. Thanks to a stockpile of the world's rough diamond supply, indelible marketing schemes and even negotiations with foreign governments for their diamonds, De Beers has been the most important name in one of the world's most lucrative businesses for almost a century. This paper will review the billion dollar rise and fall of a monopoly that has crushed competitors and cash-strapped governments since the 1800s. Diamonds became a symbol of love thanks to De Beers, which is fitting, since De Beers became what it is today because of a love story: the love of money. In the beginning, the diamond trade took place mostly in India and Brazil. With the discovery of diamonds in South Africa, the trade simultaneously took off and became much less profitable. Up until the mid-1800s, diamonds were a rarity and could be seen only on the hand of a monarch. But the diamond rush that began in South Africa in the second half of the 19th century flooded the market with diamonds, killing demand. It would take some ingenious plotting and advertising to keep the diamond's reputation as intrinsically valuable and desirable, which is where De Beers comes in (Goldschein, 2011). Company History and Overview De Beers got its start when English-born businessman Cecil Rhodes, broke into the diamond business in South Africa by renting water pumps to miners before buying diamond fields...
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