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Global Forces and the European Brewing Industry
Transcript of Global Forces and the European Brewing Industry
the European Brewing Industry
Porter's Five Forces
Impact on the companies
Strengths and weaknesses of each company
Increasing awareness of the effect of alcohol on health and fitness.
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.
South African brewer buying Miller and Pilsner Urquell.
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.
Tough legislations against drunken driving.
Licensing agreements to control the market.
China, Brazil, South Africa
Crown : can-makers
Owens-Illinois : glass bottles
On-trade : bars, restaurants
International companies dominate the market
Saturated market with big companies that leave no room for small emerging ones.
System of volume
Size of the competitive advantage
Ability to innovate
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
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.
Top brands : Heineken and Amstel
Family company : stability
Locally acquired companies
5% of sales in Asia-Pacific
Fruit flavoured beers
50% of sales overseas
Innovation and branding at the core of strategy
Turnover : One twelfth of the size of Heineken's
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.
Created from a merger with Brazil
Sales turnover : €13,3bn
2nd brewing company in China
Objective : biggest brewing company in the world.
Creation of new products : fruit-flavoured beers.
Rise of an awareness for environment.