Beer Industry Austlia Market Mix Essay

Investors for Craft Brewery Start Ups _______________________________________________ 24 Craft Beer in a Tin initiative:_______________________________________________________ 25 Corporate Social Responsibility ____________________________________________________ 26 Economics of Beer: _______________________________________________________________ 28 Building a Craft beer brand: _______________________________________________________ 29

Molson Coors is a thriving international brewing company that has nine Signature Brew drinks and 123 Special Brew drinks that ranges from non-alcoholic to alcoholic (Molson Coors Brewing Company, 2016b). They have multiple markets around the world which contributes to the success of the company in the brewing industry. This report analyzes Molson Coors’ internal and external environments which determines their position in the brewing industry. It also discusses strategies the company uses in order to be successful in their industry. Molson Coors shares the industry with its main competitors but has its own uniqueness that makes its business stand out. Molson Coors is a successful business that presents opportunities for economic growth.

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

Boston Beer’s strategy is primarily focused on growth through differentiation. The sources of its competitive advantage can be classified as a company that provides high quality beer with unique flavors, a market driven approach, and a very efficient contract brewing strategy.

Over the last twenty years, there has been a craft beer revolution and the New Belgium Brewing Company has been at the forefront of this evolution within the beer industry. Throughout the history of business, there has been “Blue Oceans” created within the larger established “Red Oceans”. “Blue oceans denote all the industries not in existence today—the unknown market space, untainted by competition” (Kim & Mauborgne, 2004). The craft beer market is considered a blue ocean because it was an untapped sector of the beer industry, which has created a new market space within the beer industry.

Brisbane Brewing Co has had a huge impact on the Australian population as well as the population in other countries in which it operates because it is a large employer and retailer of breweries such as alcoholic and non-alcoholic drinks. Due to its size and business scope it affects the lifestyles and lives of the people in the areas it operates. On the other hand beers are turning of and wines are becoming more popular, awareness on the effect of alcohol, decline of consumption on- trade in bars and restaurants and increase of off- trade.

Lager beer has traditionally been the product of choice for most of the pre and post WWII era consumers, mainly competitor Kirin’s customer base, but that segment has diminished resulting in a younger generation of beer drinkers preferring a variety of products including draft and dry beers. This has been proven through consumer research and taste tasting trials. It should not to be presumed that lager beer is obsolete has demonstrated by Kirin’s dominance of that market segment from the 1988

     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

PESTEL will be used to examine Cobra beer’s macro environment. PESTEL allows organisations to be attentive to what is occurring in the world in their specific industry (Grant, 2016). PESTEL involves looking at the political, economical, social, technological, legal and environmental factors (PESTEL Analysis, 2013).

ABL recently acquired several coffee bean businesses to capitalise on the growth of the coffee market in Australia. (Exploring a new product idea Ready to drink chilled coffee)

The brewing industry is interesting to examine due to its relatively unique structure. Up until November 2015, the market was dominated by four main players, known informally as the “Big Four”. AB InBev was the largest, followed by SABMiller, Heineken and Carlsberg. In November 2015, however, ABInBev and SABMiller agreed a formal $107 billion takeover deal, combining the brewers into a company which industry experts claim would control around half of the industry’s profits (Mickle, 2015). As a result of the sheer size and complexity of the merger, it is anticipated that the deal will not be finalised until the second half of 2016 as ABInBev must negotiate with anti-trust regulators around the world with respect to their potential monopolistic position. As the deal is yet to be completed, this report will analyse ABInBev independent of SABMiller.

Unfamiliar cultures/language: Although both Heineken and Carlsberg are considered foreign multinational companies, there are still differences in corporate governance and culture between the two firms, which might create barriers for a successful partnership. Moreover, the difference in culture between the two local JV company (Alliance Brewery Company and Golden Star Group) will make the alliance more complicated. The difference in language used for these 4 parties (English or Dutch for Heineken, Danish/English for Carlsberg, and Burmese for Alliance Brewery Company and Golden Star Group) will create additional trust barrier during the negotiation process.

The Michigan Future Business Index has pointed out the optimism business owners in Michigan feel in regards to the state’s future business climate. Nearly two-thirds of business owners feel that Michigan’s market is in a good place for products and services. The report indicated Northern Michigan is strongest for hiring and keeping talent for their employees. Nearly two-thirds or 63 percent believe sales in Michigan will increase in the course of the next six months.

As markets depend on customers and customers may differ in their needs, wants, their resources, locations, buying practice and attitudes (Kotler, et al., 2008, p. 410). The business can find who their customers are in each market segment, by drawing a customer profile that can be performed by market research.

In recent decades the brewing sector, despite its long tradition as local industry, has start to follow the increasing internationalization of economic activities and the globalization of markets, becoming now a global market governed by cross border takeovers and growth through acquisitions.