I went to Whole Foods and they have 6 other brands of Kombucha drinks and they are all beautifully package and right at the entrance. This is the latest health fad and REED should not be chasing fads. They should focus basics. Investing in fads rarely works. They are a late entrant and will find shelf space difficult to secure. Another mistake.
The ginger and root beer market is crowded too - but they have carved a space. K market is very fragmented - only GT dominanat - so there is room for #2. Most stores have GT + 3 other local players next to it w/ limited offerings. Even if they do a conservative $5m - thats like selling $10m of ginger/root beer...since they have almost 2x margins. Would be a suprised if REED didnt do at least $38m in 2013 total revenue...
Gee- A company with a great reputation for developing leading beverages shouldn't be gunning for a large market presence, in a space where their expertise can be used as a competitive edge. I think IBM invented the PC, then others like: DELL....GATEWAY APPLE AND HWP......................took that share lead away from them. Your advice is sound, stay away from large markets where your skill sets can be maximized in dollars.
Wrong, only you and IBM think they invented the PC. Dr. Roberts is the father of the PC, who later formed a company called Micro-Soft. Needless to say,Analyst has a point that competition is tough with Kumbucha and just my opinion but the labeling for Reeds is not as good as its competitors .