Subject category:
Strategy and General Management
Published by:
Ivey Publishing
Version: 2024-05-06
Length: 21 pages
Data source: Published sources
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Abstract
The Japanese sake market witnessed a 40-year decline, fueled by shifting consumer preferences and an aging customer base. Asahi Shuzo Co Ltd (Asahi Shuzo), a once-struggling brewery from Yamaguchi, defied the trend with the success of its singular brand of sake, Dassai. By 2022, under the leadership of the founder and chairperson of the company, Asahi Shuzo's sales surpassed JPY16.5 billion, marking a phenomenal 165-fold increase since 1984. Expanding into 20 countries by 2016, the company aimed for a 50:50 revenue split between sales brought in from its Japanese market and sales brought from its overseas markets. In 2017, Asahi Shuzo's president and fourth-generation owner embarked on a bold venture - to construct its first overseas brewery in New York. Initially estimated to cost JPY1 billion, by March 2023, due to delays related to COVID-19, the costs increased to JPY8 billion. The opening of the Dassai Blue Sake Brewery in New York in October 2023 raised questions about what the global market's impact would be on Dassai as a premium sake brand. As the brewery in the United States became a reality, challenges and uncertainties unfolded, shaping the narrative of Dassai's strategic evolution.
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Abstract
The Japanese sake market witnessed a 40-year decline, fueled by shifting consumer preferences and an aging customer base. Asahi Shuzo Co Ltd (Asahi Shuzo), a once-struggling brewery from Yamaguchi, defied the trend with the success of its singular brand of sake, Dassai. By 2022, under the leadership of the founder and chairperson of the company, Asahi Shuzo's sales surpassed JPY16.5 billion, marking a phenomenal 165-fold increase since 1984. Expanding into 20 countries by 2016, the company aimed for a 50:50 revenue split between sales brought in from its Japanese market and sales brought from its overseas markets. In 2017, Asahi Shuzo's president and fourth-generation owner embarked on a bold venture - to construct its first overseas brewery in New York. Initially estimated to cost JPY1 billion, by March 2023, due to delays related to COVID-19, the costs increased to JPY8 billion. The opening of the Dassai Blue Sake Brewery in New York in October 2023 raised questions about what the global market's impact would be on Dassai as a premium sake brand. As the brewery in the United States became a reality, challenges and uncertainties unfolded, shaping the narrative of Dassai's strategic evolution.