Case study on Saku Brewery

By Abhilash.S

History

Saku Brewery officially started producing beers in 1820 ,under the guardianship of Count Karl Friedrich von Rehibinder. Mission to change the image of beer from Soviet times, as Estonians and Russians believed beer to be a lowquality beverage that lasted only seven days 1996, Saku had listed its shares on the Tallinn Stock Exchange

Product line
Saku Originaal, consumers were mostly middle-aged men. Saku Rock, a beer aimed at younger consumers. Saku Tume, a dark beer popular in the winter Saku Sorts, a bock-beer Saku Valge, a premium wheat beer for distinguishing tastes. Presidendi Pilsner and Presidendi 8, two extra strong beers. Saku Originaal Light, launch a low-alcohol product.

Overview

Cardo Remmel (CEO) and Karin Sepp (Marketing Director)- Saku Olletehase AS had to plan the companys product portfolio plan Saku had a major market share in Estonia with its trademark brand Saku Original But their command over the market weakened recently because of increased domestic competition and imported brands market share.

Amidst this, the company still had fair turnover in its other products like long drinks, cider, and non-alcoholic beverages like bottles water and juices They also had exclusive rights to sell 2 major soft drink brands- Pepsi and 7Up and 3 international beer brandsGuinness, Kilkenny and Carlsberg The company amidst these opportunities, was necessitated to plan for the future renovation to emerge as an innovator

Issues
Companys trademark brand Saku Originals sales have been falling Company planned to export Saku Original to Finland hoping to curtail some of the fall in its sale Export to Finland may affect domestic sales to Finns Unsure whether the profits from the export sales could cover loss suffered in domestic sales

Growing product categories Uncertainty in deciding whether to increase the bottled water and soft drinks market share Could not conclude as to drop or alter the cider and long drinks product lines, which are nearing market saturation

Suggestions

Saku can opt to leave the sales of Kilkenny, one among the 3 international beer brand it sells.( Kilkenny sales fell by 29.4%) Saku can filter the products on the basis of demand and cost effectiveness and thus, shrink its product line As Saku has a potential market in bottled water, concentrating more on its promotion could be beneficial

Saku held only 4% of soft drinks market dominated by Coca Cola. So it can decide upon it holding this product line.

Conclusion

Saku is in the right direction with its decision on Saku Original. Export of companys flagship brand may curtail the fall Saku can increase their market share and profit further by concentrating more on their best product line i.e; Cider and long drinks Soft drinks market seems to slug, so better to eliminate inefficient Focusing on strengths like creation of products for women(Kiss) and youth will increase the companys market presence