On Friday April 10, 2015, the Financial Management Association did a corporate visit to the Boston Beer Company (and its Samuel Adams Brewery) in Boston. It was a very educational experience on the operations and inner workings of one of the world’s most award winning beer companies. The tour began with a brief history lesson on the company and how it all started in Jim Koch’s kitchen in 1984 when he first brewed Boston Lager. Our group was then given the opportunity to taste test the different types of barely that go into making the beer as well as examining the hops. (photo below). This allowed our group to truly understand what went into the beer consumers drank, where it came from, and the process the Samuel Adam’s company goes through in picking its suppliers. The description of the beer making process quickly ensued, learning about the different processes needed such as fermentation, mashing, milling and many other steps.
The last section of the tour was the taste testing of the beers for those of age, including Summer Ale, Boston Lager, and a trial IPA not yet released to the market. Upon the distribution of the trial IPA we came to learn that the Boston factory is the trial factory. It has created over 60 different styles of beer over the last 31 years and continues this process every year. The Companies larger factories around the area produce the current offerings and send them to distributors and storefronts around the country. The Boston factory is constantly researching and developing new styles of beer to sell to its consumers, explaining why they have such a large share of the shelves in liquor stores as well as a strong presence in bars all around. It also highlights the company’s relationship to its consumers, including both the drinkers and the storefronts that sell to them. Samuel Adam’s is notorious for its buyback program, a program in which if the beer is past its peak freshness date on the shelves, the company will buy it back from stores for its market value. This ensures that the customer is drinking the best product possible and that the stores and bars selling their product never lose money. Sam Adams is the only brewer with a cooperative program with its distributors to buy back products past its peak freshness date. The high standards Sam Adams sets with the ingredients that go into the product, the long testing process of new beers, and the buyback program illustrate how committed they are to selling the best product possible. This process could be seen as part of the reason the company’s stock has done so well in the last 10 years, rising from $23.70 in 2015 to $262.99 as of April 14, 2015. High customer satisfaction, distributors never having sunk costs due to unsold or expired products, leading to distributors constantly keeping the company on the shelves, both highly promote sales growth.
This was a great experience for all who went to see the operations of a highly successful company and how it’s high standard operations process and customer consideration has impacted its growth and promise. We look forward to our next company trip in the fall, we highly suggest you attend.