Constellation Brands: Brewing A Great Future In An Aged Market

1/11/18

Constellation Brands (STZ) owns more than 100 brands in its portfolio, selling beer, wine and spirits in the United States, Mexico, New Zealand, Italy and Canada. But how is it continuing to grow sales and expand margins at the same time in such a mature industry that was expected to grow by a mere 2.1% over a seven-year period? More importantly, what gains have their strategy yielded over the past few years, and is the company still following that tried and tested path?

Constellation has made one thing very clear: The company is extremely focused on strengthening its position in the premium beer, wine and spirits market. As a result, operating margins have been on the rise over the last several years, and the strategy is paying rich dividends for the company.

Within the beverage segment, Brown-Forman (BF.B) is another company that is making all the right moves. Brown-Forman has a horse for course approach, with a product portfolio optimized specifically to suit regional tastes and preferences. In the article titled “What Changed At Brown-Forman, Makers Of Jack Daniel's?“ I wrote this:

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