Coopetition among nascent craft breweries: a value chain analysis

Abstract

Purpose

The purpose of this paper is to employ an inductive approach to explore how small, nascent, firms in the craft brewing industry use cooperative behaviours with direct competitors to achieve their goals.

Design/methodology/approach

Data were gathered from interviews with the founders of seven small, newly established, craft brewers in a Midwestern city in the USA for this exploratory study. Data analysis followed the general tenants of inductive coding. Porter’s value chain model was used as a framework to organise and conceptualise the coopetitive behaviour uncovered.

Findings

The firms engage in cooperative behaviours with their direct competitors in areas such as process technology development, procurement, inbound logistics and marketing. A particularly interesting and common collaborative activity was breweries recommending/promoting competing breweries to their own customers.

Practical implications

This study provides clear examples of how relationship building with competitors could be advantageous and help small, nascent firms overcome the liabilities of newness and smallness.

Originality/value

Research on coopetition has called for a greater understanding of the nature of cooperative behaviours in small firms, start-ups and firms outside of high-technology industries. Moreover, research has called for finer-grained approaches to conceptualising coopetition. This paper fills these gaps and shows how Porter’s value chain is a useful tool for organising the types of collaborative behaviours that can be part of coopetition. The findings enhance understanding and facilitate future research by illustrating a broad array of cooperative activities that occur between direct competitors.

Citation

Flanagan, D.J., Lepisto, D.A. and Ofstein, L.F. (2018), "Coopetition among nascent craft breweries: a value chain analysis", Journal of Small Business and Enterprise Development, Vol. 25 No. 1, pp. 2-16. https://doi.org/10.1108/JSBED-05-2017-0173