Case Study: Deutsche Brauerei

The proposals of the meeting with board of directors for Greta Schweitzer consisted of three items of business: (1) approval of the financial plan for 2001, (2) declaration of the quarterly dividend, and (3) adoption of an incentive compensation plan for the marketing manager. She has to evaluate the past financial performance of company and review the strategies about credits and inventories. Deutsche Brauerei produced the quality beers over the years. Its net sales and profit have been incredibly growing in recent years. There are many of factors explained their growth. One factor is that they acquired the equipment in 1994 which are efficiency improvement. These new equipment increased their potential output. However, the firm hadn’t reached their full capacity so it means that it can be more potentially productive in the future. The second reason is that they have penetrated the emerging market, Ukraine. The country was attractive after 1995 since the government started on a privatization and a market reform, given larger population of 52 million and its strategic location within Central and Eastern Europe. Since such a nation with process of rapid growth from business activities is favorable for the company, after entering the Ukrainian market in 1998, the company was overnight successful. Also, the beer taste itself provided easy entry opportunities for Deutsche Brauerei. The company’s success also derived from strategy of Oleg Pinchuk, a former major Ukrainian beer producer. He aggressively had policy on giving credits to distributors. On a small budget, he had organized five distributorships, taken the company to 211 customer account (from 0), and set up warehousing arrangement. These policies were a key of achievement. Oleg Pinchuk’s strategies focused on getting people into distribution pipeline to serve customer needs whenever they want it. Although there was nonexistent for beer-distribution pipeline, the company set them up to be our