How a Small Brewery Can Expand to New Regions Presentation

Introduction

There are several ways in which a small brewery like Five Islands can expand beyond the region within which it operates. This answer focuses on three ways that are considered being best suitable for Five Islands. The brewery can increase its number of outlets and factories, start franchising, or do direct marketing in the new target regions.

Building Additional Breweries

Although it is an expensive option, constructing or buying new premises for additional outlets and factories is one of the best expansion methods the company may choose to adopt.

Building additional outlets requires capital to build the new premises, transport raw materials or finished goods to the site, market, and hundreds of other costs.

Franchising

• Franchising is a remarkably convincing way of capturing and keeping new customers in a new market, even if the market is in another region (Gappa 2010).
• Franchises help customers form the mental image of a brand, and how the brand can be beneficial to them in the present and in the future.
• The downside of franchising is that it does not favour a small company. This is caused by lack of sufficient knowledge about the company’s products.

Direct Marketing

• The old fashioned method of direct marketing is a slow but highly reliable way of expanding to new regions.
• With direct marketing, there are no channel intermediaries.
• A good example of a company that does a direct marketing is Apple Inc. (Apple Inc. 2006). They have their own Apple Stores to sell their products.