global beer

Global Beer

Matthieu Lecuyer-Masashi Miyazumi-Michael Kiefer-Tiphanie Guembes

Summary

I – Company and Industry Background

II – Sales Strategy

III – Futur Business Meriting Consideration

IV – Analysis company

V - Conclusion

I – Company and Industry Background

History of the company :

- Creation of the company : 1994

- Slogan : Born in Belgium, enjoyed in America

- Exportation : Exclusive U.S. importer, in 47 states, and in more country as Italia, Nederland, Spain …

- Numbers : - nearly 60 Belgian beer labels

- 35% of the production is exported

- Legislation : The U.S. Department of Justice generally considers HHI levels of 1,500-2,500 to be consistent with moderately concentrated markets, and levels above 2,500 signifying high concentration

History of the company :

Collaborations:

BROUWERIJ VAN STEENBERGE

Video presentation :

https://www.youtube.com/watch?v=zr5fkMry6NE&list=PL3245F421C9A27CA7

I – Company and Industry Background

Industry Background and Trends:

1994: "BOOM" of import beer The strength of "yen" and the importation of live sales at Japanese.

1995: The market failed to absorb a rapid influx of imported beer, it causes a resale 4 million box.

The two largest U.S. brewers:

- They were not required to go through the Japanese distribution circuit

- They missed their arrival on the Japanese market as a bad image emerged from their past actions.

Industry Background and trends :

II – Sales strategy

Trends

Entry strategy for Japan

Redefining sales strategy

The Global Beer Industry Has Consolidated Over The Last 10 Years

Global Beer has gone through substantial consolidation in the last 10 years is the global beer industry.

Ten years ago the global beer industry was highly fragmented with Anheuser-Busch’s 8.5% market share enough to make it the global leader.

Since then, a steady process of consolidation via M&A has taken place – often focused around cost-cutting opportunities

Geared towards acquiring attractive emerging market assets (e.g. Heineken’s $24 bn acquisition of Asia Pacific Breweries completed in 2012).

Global Beer measures as considerably more fragmented than the other industries in our study. Today’s an estimation says 21% market share, has been the driving force behind much of this consolidation.

Interbrew’s acquisition of AmBev in 2004 created a new global leader, InBev, with 11% share and the subsequent Anheuser-Busch/InBev merger in 2008 again created a global leader, AB InBev, with 20% market share.

Today’s top 5 companies represent more than 50% of the global market (versus 32% for the top 5 players in 2003), and the industry’s HHI has risen to 725 in 2013E from just 276 in 2003.

The score is calculated as the sum of the squares of the market shares of an industry’s competitors."

Global Beer Consumption Statistics and Trends Infographic

Evolution of beer market

Beer Consumption in the world

Entry Strategy for Japan

Entry Strategy for Japan

2 entry strategies intothe Japanese microbrewery market:

-selling directly, with 　 vertically integrated sales & service

-selling through a Japanese trading company

selling directly requires vertically integrating of sales & services

→Global Beer became able tomaintain managerial control

selling directly & vertically integrating enabled toown after-service businesses

Entry Strategy for Japan - selling directly -

Price of brewing systems were extreme

→ the Global Beer founders saw the opportunity to capture more value from Japanese trade companies

Entry Strategy for Japan-selling through a Japanese company-

III- Futur Business Meriting Consideration

Microbrewery in Japan

Regional Japanese brand

International brewpub franchise

Japanese webpage

Marketing Strategies Resellers

• Profit Margin was low• Lumped together with other cheap foreign beers• Not much differentiation• Sold for home consumption

Initial Investment

Cash Flow/ Year

Npv(discount rate)

IRR

1,550,000$

216,816$

256, 841$

402 %

Marketing Strategies Regional Beer Brand

• Long development time• Not ready for launch• Skilled person available to make a good tasting beer

Initial Investment

Cash Flow/ Year

Npv(discount rate)

IRR

23,667$ 117,391$ 954,659$ 902 %

Marketing Strategies Brewpub Franchise

• Trending in Japan• Wide Customer range from 20-50• Huge potential cash flow

Initial Investment

Cash Flow/ Year

Npv(discount rate)

IRR

1,500,000$

634,000$ 3,750,604$ 239%

706,000$ 591,425$ 4,222,536$ 520%

Marketing Strategies Japanese Webpage

• Low cost• Low amount of work needed• Low competition• Could provide information for Resellers and Pub locations• Behind paywall; uncertain if Japanese Reseller would pay the fee

Initial Investment

Cash Flow/ Year

Npv(discount rate)

IRR

50,000$ 150-200,000$

1,339,420$

278%

Global Beer Production by Country in 2011.

Production volume in Japan is a combination of beer, low-malt beer, and no-malt beer.Japan rank

IV - Analysis company

Time for decision

Focus on marketing strategy

V - Conclusion

Recommand another strategy

Summary

Thanks for you attention