Anheuser-Busch: A Discussion

Anheuser-Busch “is among the global company’s largest and most technologically capable breweries” (About, n.d.). On Anheuser-busch.com, you can find a lot of information about the company and their products. The headquarters of Anheuser Busch is located at One Busch Place St. Louis, MO 63118 (About, n.d.). The most known beer families that they produce are the Budweiser and bud light Family. There are numerous brands that Anheuser-Busch produces aside from Budweiser and Bud light. Initial searching for Bud Light Company because most of my family is enthralled by this beer, and upon further researching the beer brand, it was surprising to find that it was actually owned and manufactured by another company, Anheuser-Busch, that also manufactured

“The beer industry in the United States generates $75 Billion in annual sales.” (Abelli, 4)

     In this paper I will be talking about the U.S. beer industry and in short an overview of the brewing industry worldwide. I will talk about the barriers to entry, economies of scale, government intervention, pricing, current market trends, product differentiation, and imports. The focus being mainly on the U.S. brewing industry oligopoly. The U.S. brewing industry has three major players: Anheuser-Busch, SAB Miller, and Coors/Molson. Anheuser-Busch is currently the largest brewer in the world, producing over 100 million barrels a year. Anheuser-Busch currently owns over 50% of the market in the United States, with Miller trailing behind at 20% and Coors at about 11% with the rest of the market occupied by imports and craft breweries. When analyzing any industry, how easy it is for newcomers to enter the market is a great importance. If there are high barriers to entry

In regards to business-level strategies and overall cost leadership, Anheuser-Busch is the undeniable industry leader when it comes to beer sales. Even if Anheuser-Busch beers aren 't the cheapest, they still are bought for their quality and Anheuser-Busch has gained tremendous market share for this. As for their focus, Anheuser-Busch focuses on a broad segment of customers producing a variety of beers for a variety of budgets to suit all personalities ' needs. Their differentiation factor is that even though Anheuser-Busch produces such cheaper beers as Budweiser and Bud Light, they also produce premium, more expensive beers like Bare Knuckle Stout and Shock Top Belgian White. Anheuser-Busch produces over 100 different brands of beer and

A documentary film made in 2009, Beer wars features and describes the American beer industry distinguishing between the large and small breweries. The large breweries feature some main corporate companies like Coors Brewing Company, Anheuser-Busch, and Miller Brewing Company whereas the small breweries include craft beer producers like Moonshot 69, Stone Brewing Company, Dogfish Head Brewery, Yuengling, and others. The documentary shows how the beer market is controlled through advertising and lobbying, which is harmful for the competition in the market. There is a reason why the small companies are falling behind and the large corporates are controlling the market, which in turn makes it essentially oligopoly economy.

Anheuser-Busch Companies, Inc. continually seeks opportunities to maximize shareholder value and increase efficiency. Through their extremely effective marketing

The brewing industry has traditionally been a successful commodity. In the year 1985, the brewing industry’s consumption and sales ceased increasing and became frame. During this time, Coors emerged as one of the most successful brewing industries in the country, raising their sales by 13 percent. Throughout this course, I have learned that a company will be able to maintain success if they are able to receive more earnings on capital than their expenses. Throughout the first 100 years or so, Coors was an extremely successful brewing company. How did Coors become so successful so quickly? Coors, in their early years, began selling only to a select few western states. Coors was very effective during the time when they were selling to these states. Their centralized location allowed them to easily ship to these states and low prices helped establish them early on as an effective brewer. Over time, however, Coors began to stabilize and lag behind competition. Being the most successful brewing company for such a long time may have hurt Coors in the long-run. As competing major breweries began implanting new strategies and tactics, and Coors would stick to what they had been doing all along. Coors needs to realize that in order to stay competitive in an industry adapting to change is a vital entity.

Unfortunately, this case study highlighted a point in time where Coors was not performing well. The first visible sign of their struggles was in Quiz 4, which highlighted Coors income per barrel drastic deterioration from 1977 to 1985. The charts and graphs included at the back of the case study gave a graphic representation of the relatively low market share Coors held in 1977 and how this decreased in coming years compared to companies such as Anheuser-Busch, Miller, Stoh, and Heileman. Market share is an important value driver when increasing a firm’s performance based on a comprehensive value metrics framework, and with Coors industry market share being low this provides a problem.

Volume decreased for the first time in over twenty years in 1975 by four percent, during that same time Coors started to push out further in an attempt to become a national brand. 1985 marked a major year for the company as it set records in volume sold and revenues from the brewing division. Between 1975 and 1985 there were major changes in the company that eventually led to the company possibly opening its second brewing facility in history in Virginia. Through these years there were many new strategies implemented to foster this growth. In this paper I will diagnose key decisions, analyze potential solutions and show the actions needed to achieve the suggested changes.

In the summer of 2008, InBev NV, a Belgian-based brewing company formed from the merger of InterBrew and AmBev, offered a bid of $46.6 billion to acquire Anheuser-Busch Co to create the world’s largest brewing company at $65 a share. The initial offer was subsequently declined in part because the company felt the offer undervalued the company greatly. InBev later increased their offer to $70 a share and in Mid-July, Anheuser-Busch accepted the offer making the total cost of the deal $54.8 billion dollars. The issue then becomes whether the offer of $70 is justifiable to InBev’s shareholders. The merger brings about two different management styles. The culture at InBev focused on extreme cost-cutting measures and profitable incentive-based compensation programs. However, Anheuser-Busch’s culture differed in that they prided itself on philanthropy, diversity, and community involvement. In addition, this company possessed many luxurious offices and corporate fleet of aircrafts. Furthermore, they invested heavily in advertising, derived most of their profits in the United States, and possessed a lackluster international expansion plan. Issues the financial managers face will be differing business philosophies in regards to marketing (“Grow/Defend/Maintain/Cash” matrix approach vs the large marketing budget of Anheuser-Busch), culture (cost cutting measures vs company perks), and the future of the twelve

Based in St. Louis, Missouri, Anheuser-Busch is the leading American brewer. The company is one of the largest theme park operators in the United States, a major manufacturer of aluminum cans and one of the world’s largest recyclers of aluminum cans. Our diverse background also includes malt production, rice milling, real estate development, turf farming, label printing and transportation services.

Anheuser-Busch Inbev is one of the largest breweries in the world. “Currently, Anheuser-Busch InBev has a product list of more than 200 beers, including global best-sellers Budweiser, Stella Artois, Beck’s, multi-country brands like Leffe and Hoegaarden, and strong “local jewels” such as Bud Light, Skol, Brahma, Quilmes, Michelob, Harbin, Sedrin, Cass, Klinskoye, Sibirskaya Korona, Chernigivske, and Jupiler, among others that have helped to make the company so successful. In addition,

Although sales of premium brands have fallen in a steady response to the growing popularity of the craft beer. The industry revenue has been stable over the past 5 years. As a result, from 2011 to 2016 the industry revenue is expected an increase and growth annually at 6.7 percent over the five years,with a total of $39.5 billion . (IBISWorld iExpert) In the long-term, these numbers are expected that grow 0.9 percent annually within the next five years. The potential growth will be seen in the traditional and premium beer sector. As a response, the giant companies in the industry Anheuser-Busch InBev and MillerCoors look forward into the merges and acquisitions as a strategy to maintain market dominance. The strategy is based on the

Beer Company 1 is a “national brewer of mass-market consumer beers sold under a variety of brand names” (pg. 120). As one might expect, this national company has “an extensive network of breweries and distribution systems and owns some beer-related businesses” (pg. 120). It also owns several major theme parks.

|The global beer industry is dominated by large corporations who have merged with rivals to increase their global and domestic market share. |