This is (for me) interesting to follow.
It's a giant step from a brand selling from website (hardly i suspect) and delivering from a van too a hotel, a footballclub and last year HQ Amberlounge and all others are also local site's or little importance i suspect transforming to a Global brand.
The amount of money and planning will be insane if they are true, and could (should) also be visibly very fast justified.
Money seems not the problem. If true, we will see if some new info about this years compagnie finance comes public gives some new inside in that. I just can't imagine a compagnie as big as Haas would not at least their part have secured. They have fulltime lawyers for that stuff on payroll.
Production needs to be up't a lot. The first minimal stock production for world wide distribution is besides promotion budget one of the big investments without guarantee. If it's not going to be bought, you made it for nothing.
Lets say 50 countries 20.000 can's UK and US 200.000 can's. That's 1.400.000 can's production and distribution. That's 540 pallets, 58.333 cases/trays of 24 can's. Seems still low, maximal 58k selling points because 1 tray is minimal delivery normally. But minimal i think for sure needed. This isn't a number a bottler will have trouble with i suspect, but if i'm 10x to low in my prediction, it could be whole other case for bottler and/or can making factory. But all in all, not something i would get panicked about and because basis is there because product exist, and they of course such things also must have thought out, no deal braker.
The infrastructure for global distribution is working, they just have to step in that line at first proces step (biggest importer/distributor in EU/US, so they take over all transport from there. Splitting between countries, Sales points, etc) For sure no deal braker. just finding the right "transport" partner and they take from factory till costumer out of your hands. They should have this (close to) ready by now because needed translations, permits, space, etc.
Promotion is by far the part that will cost most, but only efficient if other points working also. Selling on the website with current products and price is just a "joke". That was all just to make a brand name. They have a shopping-cart in right top, but you can't order other than by mail. Would not be surprised they until now haven't sold a whole pallet. Produced more and distributed more, but pr deal instead sell, just for branding. Could easy be that all is done with 5 pallets, 12.960 can's. one or 2 stickerd cool-boxes, some flags and other promo stuff as cloth, hats, boxing floor, small/smart sponsoring and a good Photoshoper.
But global selling and promotion is other categorie. There are again enough global operating specialized compagnies who gladly will take whole over for you, as long you pay. From promotion at selling points, until tv and internet advertising must be a must to justify the F1 sponsoring budget. You have to use that maximal to make most out of that invested money. And that's done by investing even more in side promotions.
All is dependent from the money they will have now onward. There is no sign they had big budget until now. From all what i have seen and found by now, their Van (likely lease) is their most valuable asset. Cloth, product, travel, promotion until now, i think could be even have been done below € 50.000,- and than is product and travel biggest cost post.
But what will be needed now, if lets assume 2 years title sponsor and livery in F1 should be worth at least 2x15 million (that can't be high right what we know FI deal and Martini deal for instance). That's 30 million, some upfront, some with a bank guarantee. (Or Haas has made deal for part company as investment option)
First production and distribution € 1 million.
Promotion, i would not be surprised that would needed same budget the Haas sponsoring has. From products, pr selling point boards etc. to more other sponsoring, etc.
That would mean they need a backing from a 50/60 million Euro. I hope for Haas they have.
How long would it take to make return investment/profit.
I suspect that if all would be running, the profit margin will be very high. Looking at price Red Bull, the price they now sell it for, won't be the normal consumer price, that should be higher for the image they portray. Out of simplicity i take 1 euro as buy in price for selling point and half is gone in costs leaving factory until seller.
So, 50 cent a can for RE. 1 cent can, 8 cent water and sugar (simplistic of course), 4 cent business costs (personal etc.), 15 cent promotion. = 28 cent costs 24 cent profit.
60 million divided by 24 cent is 250.000.000 can's to reach profit point. That's 4,16% of Red Bull's year sell of 6 billion can's. They won't sell half (only f1 sponsoring value) only from their website, just not possible. (Edit: for reaching this they have a PR budget of 37.500.000 (250milx0,15)) Seems not out of reach if close to right numbers.
All numbers are just mine, no facts, can explain thinking or reasoning, but don't attack me on a possible (most likely even) wrong number. If even 1 number would be correct would be a miracle. But this would be the line of thinking a investor would have and you would have to show imo.
Edited by Maxioos, 10 December 2018 - 23:11.