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Reinventing the San Miguel Corporation

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Reinventing the San Miguel Corporation Synthesis Eduardo Cojuangco, the CEO of San Miguel Corporation, is re-assessing the company‟s business strategy. The flagship product of this century–old conglomerate, San Miguel Beer, is expected to post a slower growth rate in its volume share because of its large market share. Th e company has operations in only three product areas – food, beverage and packaging, and has a modest international presence. In this regard, Cojuangco announced in 2007 that the company would diversify into non-allied businesses in the Philippines such as energy, mining, infrastructure and other utilities. With the goal of establishing presence in industries that present fast and high growth, it sold off its …show more content…

Leverage in their industry is equivalent to a heightened form of competitiveness. Even though San Miguel may be performing moderately in the local market, internationally, it is failing. One of the reasons why international expansion was actioned on was because San Miguel simply wanted to increase in profit through expansion. As that venture failed, San Miguel decided to expand in other ways, through tapping in to other industries. Five Forces Theory and the Macro-Environment study would have been very useful to determine what would be a good, profitable, potential industry to tap into at that particular time. Applying the Porter's Five Forces to San Miguel's current business situation, the company can achiev e economies of scale and it has its own brewery. The clients are loyal to the brand and market even in the presence of substitutes. Lastly, the client base is big but the market is saturated which presents slow market growth. Core competencies refer to the collective learning coordination skills behind the firm's product lines. These are the source of a company's competitive advantage and enable the firm to introduce an array

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