Deep Roots Distillery

0L 501 Final Project

Brittani Howard

SNHU

Table of Contents

Abstract        3

[Title Here, up to 12 Words, on One to Two Lines]        4

[Heading 1]        4

[Heading 2]        4

[Heading 3]        4

References        5

Footnotes        6

Tables        7

Figures        8

0L 501 Final Project

DRD mission is to create family ties and memories for families near and far. They do this by creating and producing crafted spirits and liqueur from locally grown organic fruits that families will use in everyday cooking and sharing experiences. The name alone signifies connection, belonging, and viability and the very origin of the Deep Roots Distillery. This is evident in “ a succession-planning business venture to ensure a viable future for younger family members”. (Beamish,2016).

  Values of DRD are locally grown organic fruits, organically certified, family and customer driven, value the opinion of customers meeting the needs of the customers. Building relationship with their customers. This is evident in “ With over 500 apple trees, and by 1995, the orchard started to sell its apples by the roadside. As production grew, the family opened the farm to customers looking to pick their own fruit (u-pick). With a consumer trend toward more organically grown food products, the family decided in 2004 to move away from conventional agricultural  practices. In 2005 the Beamish Orchard acquired full organic certification from Atlantic Certified Organic.”) (Beamish,2016).

  Two of the biggest challenges to me are competition and marketing. DRD has diversity of their crafted spirits and liqueur but one leg up over the competition could developing recipes for breads, gravies, sauces, dressings catered towards home cook with their products. Doing that will build on the versatility of the liqueurs used by chefs already in restaurants. This is evident in “ the liqueur had been widely promoted to Island chefs and was used in some meals and drinks at various restaurants.” (Beamish, 2016). After developing these aspects over the competition they can add taste and live demonstrations at the distillery and local food markets. Focusing on the concept of building on what DRD already have create to something new by developing these recipes they would also be great marketing tools. One of DRDs’ goals was to market internationally. Marketing those new recipes and already top sellers on shopping websites, HSN, QVC, social media platforms, YouTube and not just the local market would solve some of the marketing issues. Even marketing with inspiring chefs and well known chefs using their liqueurs would do the same. Three external threats to the company is cheap imports, easy to produce substitutes, and marketing. Cheap imports and substitutes would be a threat because DRD pride themselves with using organic products there are many other companies that produce organic products and they are not. Marketing can be a threat because the competition markets their products as “ “Producers of Canada’s First Legal Moonshine and PEI and Atlantic Canada’s First Vodka, Gin, and Rum.” The pride of its distillery was a hand-craft copper still from Germany". (Beamish,2016). DRD would need to find something to set them apart.

    HSN,QVC, new recipes geared to home cooking are good opportunities for DRD. Building on the versatility of their products for beverages and cooking they can bring their products to outside customers. Once this is achieved there would be financial stability after the peak season. Marketing is a weakness. They want to be known internationally but unsure of what route to take. Developing recipes for home cooks as stated before would be a start. The versatility of their products as a beverage and for cooking is a strength is the reason DRD should start with developing those products.

Using their versatility in their products it can be geared to home cooking developing new recipes for breads, gravies, and sauces to sell on the home shopping networks. DRD strive for “ a succession-planning business venture to ensure a viable future for younger family members". (Beamish, 2016). They follow through with the products being locally grown organic fruits, organically certified, family and customer driven, value the opinion of customers ,meeting the needs of the customers. DRD built relationships with their customers by starting roadside, then opening the farm with U-pick, deciding to move away from conventional agricultural practices and becoming organically certified.

From the table above the line items assets, total debt, sales, inventory, and income are increasing which puts DRD in a positive light. Current liabilities,  and cost of goods sold are decreasing meaning that there is more profit coming in. 2015 estimates makes DRD a good investment and making good profits.

• Current Ratio =  2015 – 1.45 ,  2014 - .38

• Debt to Asset Ratio (Debt Ratio) = 2015- 1 , 2014 - 1

• Inventory Turnover = 2015 - -.77 , 2014 - .51

• Return on Sales (Profit Margin)=  2015 – 1.18 , 2014  - (-1.16)

From my calculations DRD financial health is as follows: 2014 was the startup for DRD. The estimated number for 2015 makes DRD a good investment on paper. I think if they made those marketing changes suggested before will those estimates reality. 2014 profit margin and inventory turnover needs improvement. With 2014 DRD being the startup and 2015 being estimated it is hard to predict exactly where DRD is going. Those estimated numbers makes DRD a good investment on paper. DRD would be an great investment if grown in the right direction.

       DRD has diversity of their crafted spirits and liqueur but one leg up over the competition could be developing recipes for breads, gravies, sauces, dressings catered towards the home cook with their products. Doing that will build on the versatility of the liqueurs used by chefs already in restaurants. This is evident in “ the liqueur had been widely promoted to Island chefs and was used in some meals and drinks at various restaurants.” (Beamish, 2016). After developing these aspects over the competition they can add tastings and live demonstrations at the distillery and local food markets. Focusing on the concept of building on what DRD already have create to something new by developing these recipes they would also be great marketing tools. One of DRDs’ goals was to market internationally. Marketing those new recipes and already top sellers on shopping websites, HSN, QVC, social media platforms, YouTube and not just the local market would solve some of the marketing issues. Even marketing with inspiring chefs and well known chefs using their liqueurs would do the same. Another idea is gift sets for cruise lines, travel ports, and airports. When travelers go on cruise lines they bring back gifts for family members that is same for  travel and airports. On the cruise lines they have the captain ball if the chefs cooking for that event would feature DRD products in a dish or beverage or both that would be a start. They want to be known internationally but unsure of what route to take. Developing recipes for home cooks as stated before would be a start. The versatility of their products as a beverage and for cooking is a strength is the reason DRD should start with developing those products and working with these outlets would reach customers on my levels. The timeline for this would be within three to five years. The managers of DRD goal would be looking at sales and demographic data monthly at first to see where the company stand asking who we reaching and products are they buying. After the first year some excellent  data should be available to do a comparison. Each time a comparison is done the questions should be what is different from last month and how and what can be added or changed if needed. This can be done individually or done in a budget meeting using programs like Quickbooks or Coral^[a].