Business Analysis_MThr Brewery

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Macedonian Thrace Brewery S.A.

Dimitris Tsagkos || KFD555 Business Analysis & Law || Thomas Polesie Master of Business & Design || University of Gothenburg || January 2015

A Business analysis


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Macedonian Thrace Brewery S.A. : A Business analysis

INTRODUCTION

The following Business Analysis is about a greek brewing company called Macedo-

nian Thrace Brewery S.A. Its structure is based on the Triangle model. The triangle

has 3 sides that represent three key areas of interest one should examine when

trying to have a clear overview of a corporation:

1.Finances

from the company’s annual reports published on their website.

This part is about the human factor and the management style applied within the

company.

This part of the analysis deals with qualitative characteristics of the brand and refers

to issues such as the design management of the company or the image that the

consumers have imprinted on their minds about it.

Dimitris Tsagkos

FINANCES

SUBJECT

OBJECT


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COMPANY PROFILE

Macedonian Thrace Brewery S.A. was established in 1998. Their factory lies in an

industrial park in Komotini, a midsize town a few hours’ drive from the Turkish border

and few minutes from the Bulgarian border. They produce 200.000 hectolitres of

beer per year, and that’s only for tax reasons because any production volume above

that limit is taxed higher according to the greek law.

Dimitris Tsagkos

The factory in Komotini

The location of the factory

Highlight from the production line

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COMPANY PROFILE

THE PRODUCTThe company handles four different sub-brands:

Vergina Beer (Premium, Red and Weiss), Edelsteiner Premium Pils, Stadelbrau

Helles and Tuvunu.

EXPORTSThe company exports its beers to 9 countries around the world: USA, Japan, Aus-

tralia, Italy, Germany, Poland, Albania, Cyprus and Spain. This is a vital income

source for them, since the beer market in Greece is in recession. Furthermore, up

until recently it had the characteristics of a monopoly, with Athenian Brewery S.A.

controlling up to 90% of the market.

BUSINESS STRATEGYMacedonian Thrace Brewery is working for the expansion of the international pres-

ence of ‘Vergina’ beer, aiming to secure its distribution in the East and West Coast of

the USA. Furthermore, they want to strengthen their presence in the regional mar-

kets of Athens and the islands, where they can reach out more tourists and get a

slice of the pie from their competitors.

In July 2012, the company released to the market a new product called “Tuvunu”. It’s

a biological, offmountain traditional tea from Thrace with honey and lemon. The

100% Greek mountain tea with its antioxidant properties had never been exploited

commercially until then. CEO Mr. Politopoulos notes that Ice Tea Tuvunu is “only the

beginning of a plan to release to the market a range of healthy refreshments utilising

the thousands of herbs of the Greek land”. In other words, the company managed to

access a “blue ocean” of non-alcoholic, herb-based beverages.

In terms of productivity their goal is to exceed the cultivation of 10,000 acres of

crops and cover 100% of their needs in barley solely by domestic sources with noneed to import any of it.

Dimitris Tsagkos

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FINANCES

2011 was the year when the company completed investments of 4.5 million euros

and introduced new designs for the production of different types of beer. Further on,

they invested in the cultivation of 2,500 more acres of barley and in the establish-

funded by their equity without any subsidies or loans.

Revenues : 16,060

THE RECTANGLE OF 2011

L i a b i l i t i e s

: 6 ,7 8 0

E q ui t y

: 8 , 9 5 0

N o n - C u r r e n t A s s e t s :

8 , 2

1 5

C u r r e n t A s s e t s : 7 , 8

7 0

Scale : 1 cm = 2 million € , All figures in € millions

Expenses : 15,350 Profit : 0,710

CEO Mr. Politopoulos in front of the malt plant

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FINANCES

previous year, and the rectangle looks quite unchanged. However, despite the

Revenues : 16,480



L i a b i l i t i e s

: 6 ,1 4 0

E q ui t y : 9 , 6 0 0

N o n - C u r r e n t A s s e t s :

7 , 8

8 0

C u r r e n t A s s e t s : 7 , 8

6 0



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FINANCES

-

Dimitris Tsagkos

Revenues : 19,010



L i a b i l i t i e

s : 7 , 9 1 5

E q ui t y : 1 1 , 0 5 0

N o n - C u r r e n t A s s e t s : 1 1 , 9

7 5

C u r r e n t A s s e t s : 6 , 9

9 0


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FINANCES OVERVIEW

Dimitris Tsagkos

2011

2012

2013

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SUBJECT

THE LEADER

The company rather follows a “one-man show” management style. Its existence is

the result of persistent efforts by its owner, Dimitris Politopoulos, who has suffered

countless indignities in his 16-year battle to build a microbrewery and wrest a sliver

of the Greek beer market from the Dutch colossus, Heineken. His tires have been

slashed and his products vandalized by unknown parties, and his brewery has

received threatening phone calls. The problems were serious enough that the Hel-

competition.

THE EMPLOYEES

Today, the company has a committed team of approximately 80 employees. They

have managed to retain a close-knit “family atmosphere”, while at the same time

in Greece. They have generally managed to communicate a “healthy” image of

themselves, one of a company that cares about its employees and enhances the

local society.

THE PRODUCERS

Planning for the future, the company is implementing an important farming program,

budgeted at 400,000 euros. According to their plan, 200 new producers in the

region of Xanthi will supply them with an extra 80 tons of organic tea, which is indis-

pensable for the production of Tuvunu. With all these producers being directly linked

with the Brewery, one can understand the impact that the production of the refresh-

ments has in the local economy. The producers know that there is a stable companyout there to buy the bulk of their production annually, and new job opportunities are

created in the area so that young people don’t have to immigrate abroad to acquire

a better life.

Dimitris Tsagkos

The producers in action

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OBJECT

QUALITATIVE CHARACTERISTICS OF THE BRAND

The herb industry has been growing rapidly worldwide, as the customers turn to

more healthy products. The company’s decision to penetrate the herb-based healthy

When it comes to beer, although “Vergina” now has a 5.5 percent share of the beer

market — ranking behind only Heineken and Carlsberg, and ahead of about 12

hotel. As a result, it remains unknown to a big part of potential consumers. Moreover,

its low price has contributed in the product being perceived by the consumers as a

“poor man’s beer”, growing its popularity among the lower income layers of society.

The perception of Vergina Lager as a cheap beer provides the company with some

loyal customers (e.g. students), but repels some other consumer groups from

buying the product. In order to deal with it, the company has released through the

years two more types of beer (Red and Weiss) which are of higher quality and are

appealing to more demanding consumers that are willing to pay higher prices to

in the biennial International Brewing Awards of London in 2013, under the category

“Speciality Wheat Beer”. Surprisingly, on behalf of the company there was no organ-

ized effort to take advantage of this success and capitalize it through an advertising

campaign.

environmentally friendly as possible. Their factory uses modern technology, such as

the cooling water recycling plant which annually saves 20,000 cubic meters of

drinking water. This amount of water corresponds to the average annual consump-

tion of a town of 300 residents. However, they didn’t seem to make any effort to

remains an “unused weapon” in their hands.

On a funny level, Vergina has gained some publicity on the internet among young-

sters in Anglo-saxon countries, as the brand name’s pronounciation corresponds to

the one of females’ genitals. It remains unknown how the company could deal with a

complex sensitive issue like that, in terms of communication.

Dimitris Tsagkos

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CONCLUSION

Macedonian Thrace brewery seems to make small but stable steps towards the

-

-

THE END

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SOURCES

Macedonian Thrace Brewery S.A. corporate website

http://www.verginabeer.com/

http://www.euromonitor.com/beer-in-greece/report

Imerisia newspaper, Article about the Greek beer market, Retrieved 1st January,

2015

http://www.imerisia.gr/article.asp?catid=26519&subid=2&pubid=112879832

Goodnews.gr, Article about “Tuvunu”, Retrieved 1st January, 2015

http://en.goodnews.gr/Articles/Traditional-tea-Tuvunu-is-the-

latest-new-export-from-Greece_1570.html

NYTimes, Interview with Mr. Politopoulos, Retrieved 1st January, 2015

http://www.nytimes.com/2011/01/30/business/30greek.html?pagewanted=all&_r=0

To Vima newspaper, Article about greek beer consumers’ habits, Retrieved 2nd

January, 2015

Imerisia newspaper, Article about the supermarket beer trends, Retrieved 2nd Janu-

ary, 2015

http://www.imerisia.gr/article.asp?catid=26519&subid=2&pubid=112992850

http://sete.gr/EN/Home/

Pbs.gr, Arcticle about Tuvunu lancement in the market, Retrieved 5th January, 2015

http://www.pbs.gr/cms/?q=node/3255

Dimitris Tsagkos

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