Canned Coffee Growth
Our client, BrewCo, is a mid-sized U.S. beverage company known for its canned cold brew coffee products. Historically, BrewCo has grown rapidly, with sales increasing at 15% per year as it expanded into grocery stores nationwide. However, over the past year, growth has slowed significantly to just 3% year-over-year.
The CEO is unsure whether this slowdown is due to market saturation, increasing competition, internal distribution challenges, or a combination of factors. Bain has been brought in to assess the situation and help develop a growth acceleration strategy.
What areas would you explore first to understand why sales growth has slowed?
Case Exhibit
To understand why BrewCo’s sales growth has slowed, we want to break the problem down into a MECE format. In this case, the two buckets we'd like to explore are internal and external factors, as we know the change is being caused by one of these.
I. Internal Factors
- Product portfolio: Are there product or SKU issues (e.g., cannibalization)?
- Distribution and execution: Has BrewCo lost shelf presence or distribution partners? Are there stock-outs or supply issues?
- Pricing and promotions: Are there fewer or less effective promotional activities compared to prior periods?
- Marketing effectiveness: Has brand awareness or campaign quality dropped?
II. External Factors
- Market demand: Is the overall cold brew or canned coffee market slowing down?
- Competitive position: Are competitors gaining share, undercutting on price, or offering new products?
- Consumer preferences: Are customer tastes shifting (e.g., toward other beverages)?
- Economic environment: Are broader trends like inflation impacting discretionary beverage purchases?
This structure ensures we explore internal operational and commercial levers as well as external market dynamics and consumer behavior.
