The inverroche distillery was started as an emotional remembrance to the past when the mother

used to brew pineapple beer. The venture has aimed to reconnect people with the natural
environment and making people aware of the significance of the local area. It took diligence and a
number of failed attempts to come up with a perfect product. This gin could be directly related to
the nature its main ingredient was ‘Fynbos’ which was known to the locals for a very long time. The
gin was a hit in the market with revenue doubling every year since its inception. The tourist were
mesmerized by the gin and used to take bottles with them, to their country. Thus there was a global
recognition of the indigenous product.

The best thing about the brand is that it has minimal investment in marketing and the focus has
always been to on the existing capacity rather than following goals. This way the gin was profitable
and the margins stable and predictable. Though there have been some problems in the beginning
with the distributions, but it was working fine because of the new distributor. The marketing was
done in the local clubs and restaurants by the good words of the distributors as well as the locals
who take pride in speaking about the indigenous flora which led to this invention.

The South African gin market can be categorized in three categories. The white spirits, cocktails
and artisanal. The Inverroche gin has a major share in the artisanal segment of the gin market. This
market has been witnessing tremendous growth in the past few years with number of locally
produced gins rising from 2 to 135 in the span of 6 years. In the last year itself the market has grown
by 154% and Inverroche’s share has been 50% of it.

Of the three categories of gin, the artisanal or craft gin has prices starting from 25 dollars per
bottle which is more than the other two segments of the market, and inverroche’s share is
maximum. Inverroche has produced 165863 bottles in the year 2016 which was higher than the
preceding year. Thus it has a good scope of increasing the revenue in the near future as well.

The main situation that Inverroche is facing of the competition and increase in the number of
entrants in the craft gin business. The main competitors of the gin are big brand houses like Diageo
South Africa and Distell group. There are some other local craft gin producers as well which are
getting into the business due to the tremendous growth in the market. The main advantage that the
big brand houses have over Inverroche’s gin is the large marketing budget and well developed
distribution channels.

The aim of the brand has been to maintain its current capacity and meet its local demand. Although
the gin is currently exported to 18 countries but the volumes of gin sold in the local area is more. In
2018 only 12% of the production was exported which shows that the local market is more valuable
to the brand. The demand of the gin in foreign countries is very high as the foreign customers have
been contacting the brand to obtain the gin in their countries. There have been many offer for
globalization of the brand, but there has been a risk of story of the gin being lost, which was of
uttermost importance.

PROBLEM STATEMENT:

The main situation that the brand is facing is whether to take the offer of the American Entrepreneur
and enter in the global market with full rigor or to stay in the current market and keep the
indigenous product as a jewel of the city which is hard to get for the world.
THE OPTIONS

1.) Take the offer of the American Entrepreneur and make the product easily and globally available
in the developed country.

2.) Refuse the offer and enjoy the market share already available in Africa.

CRITERIA FOR EVALUATION

1.) Marketing Share/ Profitability: Before accepting the offer, an extensive analysis of the market
share on artisanal gin in U.S. should be done.

2.) Local People and Distributors: The gin has been created on the good word of the local people,
thus they have to be taken into consideration before taking any step.

3.) Values of the brand: The inverroche gin was very valuable because of its inception from a flora
which was only grown in that part of the world. Welfare of the people and global recognition of the
significance of the area is the most important for the brand.

4.) Global Recognition: The brand has a very good recognition in the local area, as well as in the
global market due to the tourists which visit the city on yearly basis. The deal of the American
entrepreneur can give an exposure

EVALUATION OF THE OPTIONS

a.) Accepting the offer of the American Entrepreneur and entering the US market:

The market for artisanal gin is increasing in America and thus it is a good time for investing in the
country. When the already existing and dominant brand of US will see a foreign brand entering the
artisanal market they would act as a tough competition as they have network distribution and
market. Thus the future of Inverroche Gin will become unpredictable.

Moreover, Inverroche brand will start from scratch to develop new market for them. This can only
be done if there is someone who has a good network for the business and it is promised by the
entrepreneur. This way the brand will extensively get a global recognition.

The acceptance of the offer can have a negative impact on the local people of the are as if the gin
becomes globally available the number of tourist visiting the city will decrease eventually and thus
the economy welfare of the locals, which was the main consideration of starting the business will be
lost.

b.) Refuse the offer and enjoy the market share already available in Africa.

If the offer from the American Entrepreneur is refused, the market of the gin in South Africa which
is already dominated by the brand will reach to a point of exhaustion ultimately and the profits will
begin to decline. Thus the brand will have to look for better options for the brand to develop.

The locals benefit a lot from the gin and thus globalization can harm their values and culture that is
related to the flora of the city. The aim of the brand has been to tell the story of the inception of the
brand, and the significance of the nature. Giving the responsibility to a foreigner is too much a risk as
it can lead to a loss in the value and story of the brand.

Thus keeping the brand in the local area, will keep it as a suspense element and also make people
from all over the world to come to the holiday town, to enjoy the indigenous gin.
RECOMMENDATION

After analysis of the options I would like to recommend you to stay in the present country and enjoy
the market share and loyalty of the locals. This can be a good thing for the brand as well as the locals
who benefit from the brand.

ACTION PLAN

The plan can be to increase the output of the exports to other countries in a manner that there is no
surplus over there. This way the foreigners will always be lacking something they relish and the
demand of the product will not go down. The increasing competition on the local area can be curbed
by investing some amount of money for marketing and distribution so that the product could reach
people who understands the value and the story of the product.