1. ANALYSIS OF SABMILLER'S STRATEGIC POSITION
1.1. Introduction
SABMiller is an international company with its main interest the brewing of beer. To understand SABMiller's strategic position is to consider their strengths and weaknesses against what is happening in the environment (Robson, 1997, p. 29). Annexure A reflects the prioritisation of the basic process of strategic analysis.
1.2. External factors affecting SABMiller
Annexure B contains a P.E.S.T analysis for SABMiller but since environmental factors are country specific it is most effective when performed for all countries of interest.
1.2.1. Political Analysis
Governments across the world take extreme measures to regulate alcohol because it affects the consumer's mind. The Miller deal exposed SABMiller to one of the highest regulated industries in the world. Re-establishing consumer loyalty towards the Miller brand will be made difficult by factors such as nationalism.
1.2.2. Economical Analysis
Figure 1.1 indicates that the acquisition of Miller ensured a greater balance between a cash-generative mature market and the cash-consuming developing markets. However, negative impact of brand, pack and geographic mix, increased cost of raw materials and greater energy costs make business in the USA difficult'. (SABMiller, 2003, p. 8)
Figure 1.1
(http://www.sabmiller.com)
1.2.3. Social Analysis
SABMiller assess their alcohol issues policy regularly to ensure responsible advertising, packaging, promotions and that the underage is not targeted.
They recognise their social responsibility towards HIV/Aids and provides support and training that focuses on the prevention of the disease.
1.2.4. Technological analysis
"Technological develo...
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...when the suppliers are able to force up prices or reduce the quality of the inputs they supply. SABMiller makes it difficult for any other brewery to establish itself in the South African market due to the strong bargaining position it has when buying its ingredients. Owing to the volumes it purchases, it can ensure that suppliers of ingredients, such as hops, look after SABMiller's interest first before supplying to other companies'. (Du Plessis et al, 2001, p. 44)
1.5. Conclusion
The combination of emerging market growth potential and the earning of hard currencies through Miller made SABMiller one of the most diverse players in the industry but its lack of experience and the loss of focus might be risky on the long run. SABMiller's strategy of growing through acquisitions put them in a position where the threat of hostile takeover is now highly unlikely.
The two organizations explained in this assignment are “Anheuser Busch” and “MOLSON Coors”. Anheuser Busch is a multinational company brewing more than 100 brands in the United States and holds a 45.8 percent of the beer market share1. The company is recognized as the No. 1 brewing company by Fortune magazine – “World’s Most Admired Company”2. Dreaming Big, Unity and Culture are the three main driving values and guiding principles which account for the success the company has achieved during the years1. All these combined with the dedication and motivation
Simpson, B. (2008). “New Belgium Brewing (B)” in Ferrell, O. C., and Hartline, Michael D., Marketing Strategy, Fourth Edition, Mason, Ohio: Thompson Southwestern Publishing, pp. 1-5.
From our research, Anheuser-Busch is content with being the number one beer company in the world, increasing sales each year in operation. We found that Anheuser-Busch met many views associated with the world, business, and behavioral dimensions. The company also displayed its stability as we reviewed one of its most successful products Budweiser, owned by Anheuser-Busch, under the marketing view and the financial view. Not only do they hold almost half of the market share in the industry but their stock prices, sales volume, and net sales have all increased from 2002 to 2003. We also looked at Budweiser in terms of geography and culture. We found due to the fact that the "western" countries consume the majority of beer, it only makes sense that Anheuser-Busch concentrates on that market. Along these lines, another key goal that is also important to Anheuser-Busch is to boost other beer markets that are located in other cultures, where at the time beer is not a major consumption.
Companies and businesses that sell alcohol have a common interest in the issue of whether the legal drinking age should be lower...
Diversificationthey have recently entered into other industries to achieve more growth such as the Philip Morris Capital Corporation. This is an investment company whose portfolio consists of leveraged and direct finance lease investments and other tax-oriented and third party financing. Altria also has 28.6 percent interest in SABMiller, which is the world's second largest brewer (Altria, 2008).
During 1920 to 1933, the prohibition of did not fix all of the social problems it intended to that occurred because of alcohol. It made the problems worse, crimes rates skyrocketed and people’s morals and ethics went out of the window. Since the prohibition period, then the three-tier system alcohol distribution has been into effect. This system, far from perfect and may not be a hundred percent of the fix to social our problems. However, since 1933 when the three tiered alcohol distribution took effect it has managed to maintain a partial neutral ground and a fine line for beer producers and distributors to follow. Therefore, as you can see without the three-tier system in place, the manufacturing and distribution of alcohol would be chaotic and unorganized in the United States and in other countries.
Spink, Gemma. "AIDS." AVERTing HIV and AIDS. 23 Dec 2009. Web. 11 Jan 2010. .
Boston Beer uses a quality strategic planning system in order to achieve their corporate objectives. They have a good system in place that they use when considering the future decisions of the company. They utilize this system each time that they decide if they are going to introduce a new product into the market. This is one of the reasons that their hard cider was able to become the number one cider in the United States in only eight months.
Today alcohol is a part of culture all around the world. Even looking into the past alcohol has been a symbol to most countries. Alcohol has been a symbol for America’s culture since colonial times. Through Prohibition’s huge failure of banning the sale, transportation, and manufacture of alcohol, Americans showed how alcohol was an important to the culture of America. United States has surely been accustomed to controversies relating the consumption of alcohol. The most recent and ongoing controversy is whether the legal drinking age should be lowered from twenty-one to eighteen.
The populace that alcohol consumption should be a great concern about is the teenage population of America. Teenagers can be very curious and impressionable. So it’s natural if they want to try the sensation of alcohol for the first time. However, teenagers should not be drinking due to the negative health and psychological effects that will hurt them in the long run.
Strives to be the leader in micro brewing while maintaining the core values it started with and had employee buy in even before it went” 100 % employee owned in2013” (Gorski, 2013).
Diageo has long been the front-runner in the premium drinks business. Its brands include Guinness, Smirnoff, Bailey's, Johnnie Walker, and Cuervo complimented by broad range of local and specialty brands from around the world. In 2002, Diageo held a 15% (United States-Spirits, 2002) market share and was by far the leading manufacturer of spirits in the United States followed by Pernod, and Fortune Brands, Inc. The market is expected to have 9.8% (Huddleston, 2005) growth in the next three to four years, so new entrants may find the going hard unless they have capital to sustain themselves.
The beverage industry is highly competitive and presents many alternative products to satisfy a need from within. The principal areas of competition are in pricing, packaging, product innovation, the development of new products and flavours as well as promotional and marketing strategies. Companies can be grouped into two categories: global operations such as PepsiCo, Coca-Cola Company, Monster Beverage Corp. and Red Bull and regional operations such as Ro...
...pportunities available in order to succeed. They are taking critical steps to meet nutritional needs in some of the most emerging growth markets in the world and continue making better returns for the farmer shareholders in New Zealand. Fonterra’s group strategy targets growth in terms of both volumes and value by aiming emerging markets, as in China, and products that meet rising demand of consumers for dairy nutrition. The company have established the following seven key strategic pathways.
The emergence of HIV/AIDS is viewed globally as one of the most serious health and developmental challenges our society faces today. Being a lentivirus, HIV slowly replicates over time, attacking and wearing down the human immune system subsequently leading to AIDS (Acquired Immunodeficiency Syndrome) at which point the affected individual is exposed to life threatening illnesses and eventual death. Despite the fact that a few instances of this disease have been accounted for in all parts of the world, a high rate of the aforementioned living with HIV are situated in either low or medium wage procuring nations. The Sub-Saharan region Africa is recognized as the geographic region most afflicted by the pandemic. In previous years, people living with HIV or at risk of getting infected did not have enough access to prevention, care and treatment neither were they properly sensitized about the disease. These days, awareness and accessibility to all the mentioned (preventive methods, care etc.) has risen dramatically due to several global responses to the epidemic. An estimated half of newly infected people are among those under age 25(The Global HIV/AIDS Epidemic). It hits hard as it has no visible symptoms and can go a long time without being diagnosed until one is tested or before it is too late to manage.