Overseas Demand is Brewing for US Craft Beers

Overseas Demand is Brewing for US Craft Beers

US craft beers have become increasingly popular abroad. Unfortunately, exports have not been able to match the growing demand.

High transportation costs and the risks of transporting a perishable product over long distances have deterred some brewers from exporting. Although some brewers have partnered with overseas beer makers and bottlers to expand rapidly, others have preferred to take a slower, careful approach to market share growth.

This post is based on the PRI.org article, Europeans are embracing American craft beer. So, why are exports trailing off?, by J. Margolis, February 15, 2018. Image source: nuamoid / 123RF.

Discussion Questions

1. Price, delivery reliability, delivery speed, quality, and flexibility can be order winners or qualifiers. For New Belgium, which characteristics are order winners and qualifiers? Why?

Guidance: Superior quality is definitely an order winner because overseas beer drinkers like the hoppy taste of US craft brews. Price is a qualifier; the high cost of shipping the beer overseas makes it difficult to beat the local competition on the basis of price. Delivery reliability is a qualifier; customers will cease to do business with suppliers who cannot deliver on time. Flexibility is a qualifier; brewers must provide the variety Continue reading

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After 100 Years, a Year is the Limit

After 100 Years, a Year is the Limit

February 18, 2018

L.L. Bean has changed its 106-year old return policy. Returns will now be limited to a one-year time period.

If that sounds generous, keep in mind that for over a hundred years, the company has offered an ‘unlimited’ customer return policy.

Over the last five years, the viral nature of social media has accelerated losses on returns to $250 million. These products are what the company calls “destroy quality”, items so used or damaged they’re sent to landfills.

This post is based on the CBS News article, L.L. Bean changes its unusually generous product return policy, by The Associated Press, February 9, 2018. 

Discussion Questions
1. How might the merchandise return policy change impact L.L Bean’s order winner(s)?

Guidance: Students should review the concept of order qualifiers/order winners.  Ask students to identify the order winner(s) that L.L. Bean had under the old customer return policy.  Students should then compare the new customer return policy to competing firms in the retail industry.  Does the new return policy change L.L. Bean’s order winner(s)?

2. With over $250 million of returns at L.L. Bean over the last five years, identify the supply chain issues created by Continue reading

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Ikea Downsizes New Stores

Ikea Downsizes New Stores

January 23, 2018

Ikea’s newest stores have smaller footprints, from pop-up sites, to stores under 10,000 square feet. That’s a big change, compared to the 25,000 square feet of traditional stores.

It’s all part of a new service design for Ikea.  In the past five years, the retailer has seen a decrease in younger couples shopping at the traditional large stores.  As e-commerce has grown for competitors, Ikea is moving to test smaller stores with technology enhancements, increase staffing to give a more personal experience, and compete in the e-commerce channel.

These pilot programs illustrate the need to rework their supply chain to support multiple distribution channels in the future.

This post is based on the Bloomberg article,  The Tiny Ikea of the Future, Without Meatballs or Showroom Mazes, by Carol Matlack, January 10, 2018.

Discussion Questions
1. What are the order qualifiers and order winners being addressed in each of the new retail channel outlets being piloted by Ikea?

Guidance: Review order winners/qualifiers. Students should then apply the order winner/order qualifier concepts to each retail channel outlet being piloted.  Are there multiple ways to address each qualifier?  How would Ikea evaluate the effectiveness of each Continue reading

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