2014 FINANCIAL REVIEW

Transcription

1

2 0 FINANCIAL REVIEW In addition to activity, strategy, goals, and challenges, survey respondents also provided financial information from 0 and 0. Select results are provided below: Percentage breakout of volume by cans Percentage breakout of volume by bottles Percentage breakout of volume by kegs A/P invoices processed per week per A/P employee A/P vendors per A/P employee A/R invoices processed per week per A/R employee A/R customers per A/R employee Net beer revenue per barrel Growth in beer volume (barrels sold) Gross margin Gross profit per barrel Operating expenses as a percent of revenue Selling expenses as a percent of revenue Taproom and retail as a percent of revenue Point of sale (distributor) as a percent of revenue Direct sales marketing as a percent of revenue Philanthropy as a percent of revenue G&A expenses as a percent of revenue Debt service coverage ratio Net beer sales per state Net beer sales per employee (total employee) Number of distributors per state % % % * * * * $.0 % % $. % % % % % % % 9 $,, $, * Employee-based ratios (A/R and A/P) represent a subset of survey participants.

3 0 CRAFT BREWERY FINANCIAL BENCHMARKING SURVEY RESULTS EKS&H, the leading audit, tax, and business consulting firm serving the craft brewing industry, conducted its annual survey of clients and friends based on 0 financial statement results. The survey covered a variety of information including strategy and performance questions related to sales, operations, employment, and distribution. The survey also gathered a variety of key financial information for the past and present year. breweries from across the country, more than half of which are in the top 0, participated in the survey. These breweries represent a million barrels of annual production. This industry report provides highlights of the data gathered with analysis to answer the questions that successful craft brewers ask. Industry festivals and distribution channels are two of the most critical elements to a craft brewer s success. As such, participants were asked about these factors. The number of distribution partners ranged from to more than 9, the average was. About % of participants do some self-distribution. The average number of festivals participated in was, and the average number of festivals hosted was 9. DISTRIBUTORS & FESTIVALS # of Distributor Partners Distribution to # of States Festivals Hosted Festivals Participated AVERAGE 9 Questions about top opportunities and challenges revealed some interesting results. Employee investment was identified as a major focus, with finding the right employees identified as a top goal, in addition to improving product efficiency and improving profitability. Distributor sales execution was the top challenge. Encouragingly, this was followed by brewery sales execution and product quality. RANK TOP GOALS RANK TOP CHALLENGES * Find right employees Distributor sales execution * Improve profitability Brewery sales execution * Improve production efficiency Product quality Improve distributor performance Compensation/employee incentive issues Improve marketing and branding Producing enough beer to keep up with demand Stimulate growth Downward pressure on pricing/margins Control growth Unstable, insufficient, or out of date equipment Increase capacity Inadequate access to capital * Top three goals were tied for importance.

4 With the craft brewing industry experiencing significant growth. recent market demand and capacity were identified as the most impactful key drivers. These were followed by distribution and availability of financing/credit variables. The later result may show that, although credit markets have been loosening, acquiring financing for growth continues to be a challenge. KEY DRIVERS IMPACTING BUSINESS 0 Availability of Financing/ Credit Brewing/ Packaging Capacity Distribution Labor Costs Market Demand

5 It appears 0 was a year of growth for most participants. In fact, nearly twothirds of participants achieved growth of 0% or more. This is a positive change from 0, in which 9% of participants reported negative or neutral growth. PROFIT CHANGE Increased More Than 0% Increased 0% - 0% Increased 0% - 0% Increased % - 9% Stayed About the Same Decreased % - 9% Decreased 0% - 0% Decreased More Than 0% Equipment/technology was identified as the area in which participants primarily increased investment. As competition grows, marketing/sales may increase, and employee investment will likely follow as craft brewers open more facilities and acquire additional equipment. INCREASED INVESTMENT 9 0 Employees Equipment/ Technology Marketing/Sales Property/ Facilities

6 For more information about the 0 EKS&H Craft Brewery Financial Benchmarking Survey (including instructions on how to participate) as well as any of the audit, tax, or business consulting services offered to the industry, please contact Mike Madden at or mmadden@eksh.com