BUSINESS

COMMUNICATION

REPORT

SKILL ENHANCEMENT COURSE

SEMESTER 4

NAME- MANYA RAJVANSHI

COURSE- BBA FIA
ROLL NUMBER – 20231330
SUBMITTED TO- MR RAHUL RANA
 BREW NOVA
BEVERAGES LTD

AURORA BREW
Sip the Sunrise

BREWNOVA BEVERAGES LTD.

Business Report: Q4 Strategic Update on ‘Aurora
Brew’
Date: April 13, 2025
Prepared by: Product Management Office
CONTENTS PAGE
S NO. PARTICULARS PAGE NO.
1 STRATEGIC GROWTH PATH 3
2 EXECUTIVE SUMMARY 3
3 BACKGROUND AND 3
MARKET CONTEXT
4 CURRENT MARKET 5
DYNAMICS
5 FINANCIAL PERFORMANCE 5
6 COMPETITVE 6
DIFFERENCIATION
7 GROWTH PLAN 7
8 FINANCIAL PROJECTIONS 7
9 IMPLEMENTION TIMELINE 8
10 RISK MITIGATION 9
11 CONCLUSION 9
12 BIBLIOGRPAHY 10
STRATEGIC GROWTH PATH FOR AURORA BREW: Q4 2024 AND
BEYOND
At Brew Nova Beverages, we are committed to reimagining the way India consumes beverages—infusing
sustainability, well-being, and innovation into every cup.
Brew Nova Beverages' flagship product is AURORA BREW, which captures more than aroma and flavour—it
encapsulates a lifestyle of conscious indulgence. It has faced significant challenges in its first three
quarters of market presence.
Despite recording consistent financial losses, comprehensive analysis of market trends, customer feedback,
and operational metrics reveals substantial untapped potential. Our data indicates that with strategic
adjustments to marketing, distribution channels, and operational efficiencies, AURORA BREW is positioned
to achieve profitability by Q3 2025, delivering an estimated 18% profit margin by year-end 2026. This report
outlines our strategic pivot and provides concrete evidence supporting the continuation and eventual success
of this innovative premium coffee product.

EXECUTIVE SUMMARY
AURORA BREW, Brew Nova Beverages' premium single-origin specialty coffee line, has experienced three
consecutive quarters of financial losses since its launch in Q1 2024. While this performance falls short of
initial projections, deeper analysis reveals several positive indicators suggesting significant growth potential.
Customer satisfaction ratings consistently exceed 4.7/5, brand recognition has grown 27% quarter-over-
quarter, and repeat purchase rates have increased each month despite limited marketing.
The primary challenges identified include higher-than-anticipated production costs, distribution
inefficiencies, and slower-than-expected market penetration in key demographic segments. However, our
comprehensive market analysis indicates that with strategic adjustments to our business model, AURORA
BREW can achieve break-even by Q3 2025 and become a significant revenue contributor by 2026. This report
outlines our data-driven strategy to transform AURORA BREW from its current underperforming state into
a market leader in the premium coffee segment.

BACKGROUND AND MARKET CONTEXT

PRODUCT LAUNCH AND INITIAL VISION
AURORA BREW was conceptualized as Brew Nova Beverages' entry into the rapidly growing premium
specialty coffee market. Launched in January 2024, the product line features ethically sourced, single-origin
beans from high-altitude growing regions, processed using our proprietary cold-extraction technique that
enhances flavor complexity while reducing bitterness. The initial vision positioned AURORA BREW as a
disruptive force in the premium coffee market, targeting discerning coffee enthusiasts willing to pay premium
prices for exceptional quality and sustainability.
The product was developed over an 18-month period with significant R&D investment (Rs1.2M) and launched
with four signature blends: Highland Dawn, Midnight Bloom, Equatorial Reserve, and Arctic Sunrise. Initial
market research projected first-year sales of approximately 120,000 units, with break-even anticipated by Q3
2024. These projections were based on the specialty coffee market's 14% year-over-year growth and consumer
willingness to spend on premium coffee experiences.
CURRENT MARKET DYNAMICS
The specialty coffee market continues to expand rapidly, with global growth exceeding 15% annually and
premium offerings growing at 18%. Within our target demographic (urban professionals aged 25-45 with
household incomes exceeding Rs75,000), coffee expenditure has increased by 34% since 2022, with
particular emphasis on premium sustainable products.
However, the broader beverage category faces challenges:
• Inflationary Pressures: Coffee and nutrition drinks continue to experience sustained high prices,
impacting consumer purchasing decisions.
• Consumer Downgrading: Tea consumers are increasingly opting for lower-priced alternatives,
reflecting economic uncertainty.
• Market Resilience: Despite these challenges, our focus on value provision, market development,
and portfolio expansion has allowed us to maintain competitive growth.
Geographic analysis shows particularly strong growth potential in the Northeast and West Coast markets,
where AURORA BREW has achieved only 22% and 17% market penetration respectively. Additionally, our
direct-to-consumer channel, launched in Q2 2024, shows promising early results with 43% higher margins
than retail channels.

INNOVATION AND TRANSFORMATION

To transform our future, we are emphasizing innovation at the core of our strategy:
1. Customized Product Offerings: Leveraging our WiMI strategy, we will develop customized coffee
blends tailored to unique consumer tastes across different regions.
2. Impactful Campaigns: Continuing our legacy of impactful marketing campaigns to enhance brand
visibility and consumer engagement.
3. Portfolio Expansion: Expanding our product portfolio to include complementary beverages that align
with consumer preferences for health and sustainability.

PERFORMANCE ANALYSIS
FINANCIAL PERFORMANCE OVERVIEW
AURORA BREW has recorded consistent losses for three consecutive quarters:
• Q1 2024: -427,000 on revenues of 310,000
• Q2 2024: -382,000 on revenues of 384,000
• Q3 2024: -295,000 on revenues of 462,000
While these figures fall short of projections, they reveal a consistent upward trajectory in revenue (23%
quarter-over-quarter growth on average) and declining losses (15% reduction in losses quarter-over-quarter).
This trend suggests movement toward profitability, albeit at a slower pace than initially anticipated.
ROOT CAUSE ANALYSIS
Our comprehensive assessment identified five primary factors contributing to underperformance:
1. Production Cost Inefficiencies: Initial small-batch production resulted in higher-than-projected
per-unit costs. The average COGS is currently 42% of retail price versus the projected 29%.
2. Distribution Channel Limitations: Reliance on specialty retailers has limited market
penetration, with only 38% of targeted distribution points achieved.
3. Marketing Strategy Misalignment: Initial marketing emphasized product attributes over
consumer benefits, resulting in lower conversion rates (2.3% versus projected 4.1%).
4. Pricing Strategy Challenges: Premium pricing (Rs 22.95 per 12oz package) created adoption
barriers in some key markets, particularly among potential entry-level premium consumers.
5. Operational Scaling Issues: Supply chain disruptions and quality control challenges during
scaling increased operational costs by approximately 18%.
Importantly, these challenges are structural and operational rather than indicative of product-market fit
problems. Customer satisfaction among actual purchasers remains exceptionally high (4.7/5), with 72% of
first-time buyers making repeat purchases within 60 days.

MARKET OPPORTUNITY AND COMPETITIVE ADVANTAGE

UNTAPPED MARKET POTENTIAL
Despite current financial underperformance, AURORA BREW addresses a growing market with substantial
untapped potential. The specialty coffee segment is projected to grow at 15% annually through 2030, with
premium offerings growing at 18%. Within our target demographic, coffee expenditure has increased by 34%
since 2022, with particular emphasis on premium sustainable products.
Geographic analysis shows particularly strong growth potential in the Northeast and West Coast markets.
Additionally, our direct-to-consumer channel shows promising early results with higher margins than retail
channels.

COMPETITIVE DIFFERENTIATION
AURORA BREW maintains several sustainable competitive advantages:
1. Proprietary Extraction Process: Our patented cold-extraction technique produces demonstrably
superior flavour profiles according to blind taste tests (outperforming leading competitors by 28% in
preference ratings).
2. Supply Chain Exclusivity: We have secured exclusive three-year partnerships with award-winning
micro-farms in Ethiopia, Colombia, and Panama, ensuring unique bean access.
3. Sustainability Credentials: Third-party certification of our carbon-negative production process
resonates particularly strongly with our target demographic, with 82% of customers citing this as a
key purchase driver.
4. Innovative Packaging: Our biodegradable, oxygen-barrier packaging extends shelf life by 43%
compared to industry standards while enhancing our sustainability positioning.
While competitors like Elevation Roasters and Blue Mountain Specialty have stronger brand recognition
currently, AURORA BREW outperforms them on product quality metrics, sustainability credentials, and
customer loyalty among actual purchasers.
STRATEGIC PIVOT AND GROWTH PLAN
REVISED BUSINESS MODEL
Based on our performance analysis and market opportunity assessment, we propose a strategic pivot focusing
on five key initiatives:
1. Production Optimization: Implementing scaled production techniques will reduce COGS from
42% to 31% of retail price by Q1 2025, directly improving margins without compromising quality.
2. Distribution Channel Expansion: Expanding our direct-to-consumer subscription model
(currently 18% of sales but 29% of gross profit) to represent 40% of total revenue by Q3 2025.
3. Pricing Strategy Refinement: Introducing a tiered pricing model with entry-level options at
Rs17.95 while maintaining premium offerings at Rs22.95+, expanding our addressable market by an
estimated 28%.
4. Marketing Optimization: Shifting from product-centric to benefit-centric messaging with
increased digital channel concentration, projected to improve conversion rates by 65%.
5. Operational Excellence Program: Implementing lean manufacturing principles and improved
quality control protocols to reduce operational waste by 32%.
These initiatives will be implemented in phases, with full deployment expected by end of Q1 2025.

FINANCIAL PROJECTIONS
Our revised financial projections, based on the strategic pivot outlined above, indicate a clear path to
profitability:
• Q4 2024: -Rs215,000 on revenues of Rs540,000
• Q1 2025: -Rs140,000 on revenues of Rs650,000
• Q2 2025: -Rs65,000 on revenues of Rs780,000
• Q3 2025: +Rs25,000 on revenues of Rs920,000 (break-even point)
• Q4 2025: +Rs115,000 on revenues of Rs1,100,000
By year-end 2026, we project annual revenues of Rs6.2M with an 18% profit margin. These projections are
based on conservative growth estimates and demonstrable operational improvements already underway.

KEY PERFORMANCE INDICATORS

We have established clear KPIs to track progress toward profitability:
1. Conversion Rate: Increase from current 2.3% to target 3.8% by Q2 2025
2. Customer Acquisition Cost: Reduce from Rs42 to Rs28 by Q1 2025
3. Subscription Rate: Increase from 18% to 40% of total revenue by Q3 2025
4. Production Efficiency: Reduce COGS from 42% to 31% by Q1 2025
5. Distribution Reach: Expand from 38% to 70% of target points by Q2 2025
Weekly tracking mechanisms have been implemented to monitor these KPIs, with bi-weekly adjustment
meetings to address any deviation from targets.
IMPLEMENTATION TIMELINE AND RESOURCE REQUIREMENTS
PHASED IMPLEMENTATION
The strategic pivot will be implemented in three distinct phases:
Phase 1 (Q4 2024): Operational Optimization
• Production process refinement to reduce COGS
• Supply chain optimization to improve margins
• Quality control enhancement to maintain product integrity
• Initial marketing message refinement
Phase 2 (Q1 2025): Market Expansion
• Launch of tiered pricing strategy
• Expanded D2C subscription program
• Distribution channel diversification
• Full deployment of revised marketing strategy
Phase 3 (Q2-Q3 2025): Acceleration and Scaling
• Expanded product line with two additional variants
• International market entry (Canada, UK)
• Strategic retail partnerships in key markets
• Enhanced customer loyalty program implementation

RESOURCE REQUIREMENTS
Executing this strategy will require:
1. Financial Resources: Rs650,000 additional investment for Q4 2024 - Q2 2025 operations until break-
even
2. Human Resources: Addition of 2 marketing specialists and 1 supply chain manager
3. Technical Resources: Enhanced e-commerce platform and analytics infrastructure
4. Manufacturing Capacity: 35% expansion of production capabilities
5. Marketing Budget: Reallocation of existing budget with 15% additional investment
The requested Rs650,000 represents a 27% reduction from the original business plan's projected capital
requirements due to operational efficiencies identified and increased focus on high-margin channels.

RISK ASSESSMENT AND MITIGATION

KEY RISKS AND MITIGATION STRATEGIES
We have identified four primary risks to our growth strategy:
1. Competitive Response: Established competitors may reduce prices or increase marketing spend.
Mitigation: Our proprietary extraction process and exclusive bean sourcing provide sustainable
differentiation beyond price.
 2. Supply Chain Disruptions: Bean availability or quality issues could impact production.
Mitigation: We have secured redundant suppliers and implemented a 45-day inventory buffer.
3. Market Adoption Rate: Consumer acquisition may progress slower than projected.
Mitigation: Tiered pricing and expanded distribution channels reduce adoption barriers.
4. Operational Execution: Scaling challenges could impact quality or efficiency.
Mitigation: Phased implementation with quality gates ensures controlled expansion.
Each risk has been quantified, with sensitivity analysis showing that even with a 30% underperformance
against projections, break-even would still be achieved by Q1 2026.

CONCLUSION AND RECOMMENDATION

STRATEGIC VALUE BEYOND FINANCIALS
AURORA BREW represents more than just a product line—it establishes Brew Nova Beverages' position in
the premium specialty market, supporting our long-term vision of category leadership. Beyond direct
financial returns, AURORA BREW delivers strategic value through:
1. Brand elevation for the entire Brew Nova portfolio
2. Access to premium retail channels for future product launches
3. Establishment of direct consumer relationships through subscription models
4. Development of proprietary technologies applicable to future innovations
5. Enhanced sustainability credentials important to our target demographics

CONCLUSIVE RECOMMENDATION
Based on comprehensive analysis of market trends, operational improvements, and financial projections, we
strongly recommend continuation of AURORA BREW with implementation of the strategic pivot outlined in
this report. The product demonstrates clear potential to achieve profitability by Q3 2025 and deliver
substantial returns thereafter.
While early financial performance has fallen short of projections, the core product-market fit is strong, as
evidenced by exceptional customer satisfaction and increasing revenues. The challenges identified are
operational and surmountable rather than fundamental flaws in the product or market potential.
The Brew Nova Beverages executive team and AURORA BREW product team remain committed to this
strategic initiative and confident in our ability to execute the transformation plan outlined herein. We believe
AURORA BREW will not only achieve profitability but become a cornerstone of our company's growth
strategy for years to come.
IMPLEMENTATION COMMITMENT
The Product Management team commits to:
1. Weekly KPI tracking and transparent reporting to leadership
2. Bi-weekly strategy adjustment sessions based on performance data
3. Monthly shareholder updates on progress versus projections
4. Quarterly comprehensive performance reviews with detailed variance analysis
We are confident that with continued support and strategic refinement, AURORA BREW will transcend its
current challenges to become a market leader and significant profit center for Brew Nova Beverages. The
journey from launch to profitability often follows a J-curve pattern, and AURORA BREW is demonstrating
the classic indicators of a product approaching its inflection point toward sustainable success.
 BIBLIOGRAPHY

1. https://www.linkedin.com/company/novobrewing
2. https://www.indiafilings.com/search/nova-beverages-private-limited-cin-
U74990PN2016PTC157872
3. https://nancymatsumoto.com/rice-water-earth-notes-on-sake-blog/nova-brewing-company-
southern-californias-bright-new-sake-star
4. https://www.yelp.com/biz/nova-brewing-covina-2
5. https://www.dnb.com/business-directory/company-
profiles.nova_beverage_group_as.6274364ec5dee335c067f8901121daa7.html
6. https://www.dnb.com/business-directory/company-
profiles.nova_beer_llc.a307bb29ec2385016fff4ad0813518a3.html
7. https://www.instagram.com/novabrewingco/