The experts at Anderson Economic Group have prepared an analysis on the craft beer industry in Michigan, including interactive visualizations. The analysis shows the explosive growth of the craft beer industry in Michigan over the past four years, where the production hot spots are, and sales for each brewery over a four-year time period. “As… Continue reading
AEG was retained to value the distribution rights of a beer distributor. The rights were owned by multiple distribution companies prior to its acquisition. AEG provided an industry review, market analysis, economic outlook, financial review, and valuation opinion for the client. Additionally, AEG provided methodology and assumptions along with the valuation opinion. AEG summarized its… Continue reading
Patrick L. Anderson and Ilhan K. Geckil
A review of valuation methods in the alcoholic beverage industry.
Franchise Value Analysis: Heineken USA and Alaska Distributors
Valuation of Beer Distributors
North American Beer Importer
Anderson Economic Group was retained by a beer importer to estimate the fair market values of several distributors of their product in the New York City area. By “fair market value,” we mean the price a willing buyer would pay to a willing seller, both possessing adequate information, for the economic value of the line of business. The valuation was done using the best available information, and well-accepted methods of estimating the economic value of a firm. However, certain unique characteristics of the market affected the value of each distributor, and adjustments were made for discounts and for premium factors of marketability, barriers to entry, scale, uniqueness of distribution system in the state, per-capita consumption and other market patterns, “bottle law” factors, and dominance of brands.
We produced a report with sections for each distributor, for use by the importer in improving its distribution network and in negotiations with its distributors.
A leading importer and brewer of top-selling beer brands from Europe, Canada, and Mexico, asked for Anderson Economic Group to provide an analysis of a Nevada-based distributor’s valuation claims, and to help determine the information needed to prepare a complete valuation report.
Our report evaluated the market area of a distributor, its sales patterns, and the financial statements needed to prepare an assessment of damages or valuation report. We found the distributor to be missing important information from its valuation, and worked with our client to determine the strategy needed to complete an accurate valuation or lost profit calculation. Specific attention was given to the importance of brand values in the alcoholic beverage industry.