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According to
recent studies and surveys, beer is the most purchased alcohol, only in USA an
estimated of 38% of adults drink beer, that is why  the brewing industry is expected to keep
growing steadily in the upcoming years.

Heineken is one
of the largest brewing companies in the world and is ranked among the best beer
options. In addition to its excellent volume sales and profitability during all
these years, this company is well positioned for global growth because it has
over 115 breweries in more than 70 countries.

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Heineken’s short-term
objectives should be increasing its profitability, conquer new markets, and maintain
a sustainable growth to be able to compete in this industry. On the other hand,
expanding its products while maintaining their brand image strong as well as
try to lower cost production should be long-term goals.

Heineken
targets consumers demographically no matter; there gender, ethnicity, or income.
Young generation, the Millennials, minorities, and middle class are some of the
potential targets. As a behavioral standpoint, Heineken has to adjust to
society’s demand constantly. Another factor, is technology, they have to keep
up with the latest advancement in order to support its production.

This industry
is very competitive because more companies are acquiring smaller brewers around
the world. Base on this issue, Heineken ‘strategy is to acquire new brewers
worldwide, expanding its global network of distribution into more countries in
order to strengthen the company’s position in the market. This will allow
increasing market shares without having to develop a new brand. For example,
Heineken was the first brewing company to partner with distributors around the
world. This type of innovation ideas that would allow competing and winning
their industry.

The company’s
mission is to increase efficiency and profitability. This can only be
accomplished by increasing advertising, offering new products to consumer like
“Heineken light”, and keep acquiring smaller breweries worldwide.

Heineken have to take in consideration Porter’s Five Forces Model
in order to evaluate their position in the brewing industry.  The threat of new entrants is very little due
to high capital requirements and poor economy conditions. The power of supplier
is very low; there are fewer brewers and larger plants, and a large supplier
market. The threat of substitutes is strong because there are many choices like
wine, cocktails, well-mixed drinks, etc as well as other forms of entertainment
like marihuana, which nowadays it’s being legalized in more places. In terms of
Bargaining power of buyer, they are all in the same level of Plain field
because there are many options. Threats of rivalry among competitors are strong
big company names like Miller Brewing, Modelo, Anheuser-Busch, etc.

 SWOT ANALYSIS

Strengths: strong brand recognition from it designed bottle,
regional diversification, brew and sell over 200 beers.

Weakness: Difficulty to acquire larger breweries, higher price
compared to domestic beers.

Opportunity: Russia and Asia Market

Threats: New alcohol legislation, poor economic conditions.

The Direct
competition is big companies liker Anheuser-Busch
who is expanding rapidly through partnerships strategy with international
firms. Also, Grupo Modelo Corona is growing fast in the market

Recommendations

·        
Increase advertising among young people

·        
Keep buying breweries worldwide

·        
Create a beer to more tasty for women 

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