Question

Let's assume that you are planning to open a new microbrewery in your city.

Conduct an environmental scan relevant to opening your microbrewery. What issues/problems/concerns do you need to be aware of for each of the following environmental forces?

• Social
• Economic
• Technological
• Competitive
• Regulatory

Answer 1

Answer

Social Factors

The consumers in that particular city need to be studied thoroughly. The consumers’ attitude to the alcohol demands changes with references to the social campaigns in which the negative effect of alcohol on the people’s health is apprised of. So if there are many campaigns being organised from time to time in that city, it may not be a good idea to open a microbrewery.

Economic Factors

Depending upon the income levels of the consumers in that particular city, the scale of operations or the existence of the bewery can be decided. If, for instance, a lot of high class people stay in that city, brewery where prices are at a higher end could be started.

Technological Factors

The brewing industry is associated with a constant progress in producing and packaging the products with the help of innovative techniques based on technological advancements (products with new flavours and tastes). These innovations contribute to increasing the products’ quality and profitability. Thus, availability of resouces in that particular city can be advantageous to the brewery.

Competitive Factors

The brewery might suffer from the high number of breweries in the city and having variety of products. Capturing of new customers might become a problem. The variety of brands kept by other breweries, the prices at which beer is sold, and other factors need to be studied throughly about the competitors before starting with the operations.

Regulatory Factors

Before opening a brewery, a lot of legal factors need to be kept in mind. Legal factors are connected with the programs against the excessive alcohol consumption, drinking in public places, and restrictions on the drinking age. The industry is also influenced by the taxes which affects the products’ prices. Also, regulatory factors may be different for different states.