In chapter 8 we look at how companies look at how they can minimize risks and uncertainty in the markets that they participate.
One specific example of how Sam Adams is trying to minimize uncertainty is in the distribution channel.
Throughout the last few years, the United States has seen many distributors fall on hard times and become a little inefficient with their practices. President and CEO Jim Koch proposed in an industry meeting, that the economic atmosphere has put many distributors in a bad situation and the inefficiencies could hurt the brewers. He proposed "such unconventional ideas as having competing distributors in the same city use a single warehouse and fleet of trucks to deliver their respective brands to bars and stores." With this distribution set-up, the brewing industry could cut costs of up to $2.5 billon and help distributors slash 20% from existing cost structures.
With this type of distribution, Jim is looking to alleviate the risks entailed in the distribution side of the business.
Read more here: http://online.wsj.com/article/SB125384534262939939.html
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