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Global Forces and the European Brewing Industry

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by

Agathe L

on 21 October 2013

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Transcript of Global Forces and the European Brewing Industry

Global Forces and
the European Brewing Industry

Pestel Analysis
Substitutes
Porter's Five Forces
Conclusion
Impact on the companies
Strengths and weaknesses of each company
Political
Increasing awareness of the effect of alcohol on health and fitness.
Economical
Increasing competitive environment
Brewers relying on super brands
Decline of beer consumption in Europe
Consumption in decline in Germany and UK but burgeonning in China or Brazil.
Supermarkets dominated off-trade markets
Brewers' main purchasing costs : packaging, raw materials and energy.
European packaging industry dominated by international companies.
Rise in packaging costs
Volume of sales falling / value of sales increasing
Mergers and strategic alliances
Smaller companies are being snapped up by large international ones.
Fosters withdrawal
South African brewer buying Miller and Pilsner Urquell.
Socio-cultural
Europe turning off beer
Wines more popular
Awareness on the effect of alcohol
Negative vision of binge-drinking in the UK
Decline of consumption on-trade in bars and restaurants and increase of off-trade.
Swift of consumption.
Legal
Tough legislations against drunken driving.
Licensing agreements to control the market.
Potential Entrants
China, Brazil, South Africa
Suppliers
Crown : can-makers
Owens-Illinois : glass bottles
Wines
Fruit-flavoured beers
Buyers
On-trade : bars, restaurants
Off-trade
Supermarkets
InBev
Anheuser-Busch
SABMiller
International companies dominate the market
Competitive impasse
Mature market
Saturated market with big companies that leave no room for small emerging ones.
Fragmented
System
Specialised
System
Competitive
Impasse
System of volume
Size of the competitive advantage
Differentiation forces
Ability to innovate
Time
Introduction
Growth
Maturity
Decline
78% of its sales in Europe BUT decline of the consumption in this area
Legislation in Europe = decrease in sales
Wine becoming more popular
Impact : They will try to find new opportunities (Asia, Pacific)
50% of its sales in Europe
Same impacts.
Same impacts
Bad image : focused on the UK where binge-drinking is highly despised.
BUT : Russie and China perspectives.
Avoid the problems of the EU market because they have market shares in China
Keep their strategy thanks to acquisition.
Strengths
Weaknesses
Top brands : Heineken and Amstel

Family company : stability

Locally acquired companies
5% of sales in Asia-Pacific
Strengths
Weaknesses
Fruit flavoured beers
50% of sales overseas
Centralised production
Innovation and branding at the core of strategy
Medium-sized firm

Turnover : One twelfth of the size of Heineken's
Strengths
Weaknesses
Strengths
Weaknesses
Limited focus (Europe)

4th brewer in the market in France, UK and Russia
Sales turnover : €5,5 bn

Investments in Russia, Ukraine and Baltic countries

Stakes in China, India.
None !
Created from a merger with Brazil

Sales turnover : €13,3bn

2nd brewing company in China

Objective : biggest brewing company in the world.
Technological
Creation of new products : fruit-flavoured beers.
Environmental
Rise of an awareness for environment.
Full transcript