,Heineken overviews,Background for Heineken Vision & Goals Heinekens Core Values Heineken sale a round the world Brand strategy Main Risks for Heineken Company Strategy Analysis Questions & answers,Background for Heineken,Location-Amsterdam Single-product business -Beer History 140 years ago in 1864 founders name Gerard Adriane Heineken which use to bear the brand name Experience four generations of the Heineken family Now ,one of the worlds great brewers, Company throughout Europe and the rest of the world.,Some data for background,170 brands Famous brands : Amstel, Cruzcampo, Tiger, Zywiec, Birra Moretti, Ochota, Murphys and Star. 54004 employees In 2007 131.9 million hl own more than 115 breweries in more than 65 countries brewing a Group beer volume of 131.9 million hectoliters.,Heineken sale a round the world,Western Europe Central and Eastern Europe The Americas Africa and the Middle East Asia Pacific,For more details, see appendix,Aims for sustainable growth as a broad market leader ,segment leadership Four priorities for action include: to accelerate sustainable top-line growth. to accelerate efficiency and cost reduction. to speed up implementation: we commit to faster decision making and execution. to focus on those markets where we believe we can win.,Vision & Goals,Heinekens Core Values,Three Core values strategically important for the long-term success Respect Respect for individuals, society and the environment ,honors local laws and regulations. Enjoyment Bring enjoyment to life Passion for quality Our business only works if we make great beer,Brand Strategy,Build a strong brands portfolio that combines the power of local and international brandsBrand Center: Heineken and Amstel. Position Heineken :premium brand, except for home market in the Netherlands. position Amstel : mid-priced mainstream segment, the largest segment of the market In Europe, and is available in more than 90 countries around the world. Brand portfolio more than 120 top-selling brands limited presence in the low-priced segment of the market lagers, specialty beers, light beers (low-calorie beers) and alcohol-free beers,Company Strategy Analysis,Main Risks for Heineken,Strategic risks Heineken brand perception and Company reputation Pressure on alcohol Attractiveness of beer category under pressure Operational risks Acquisitions and business integration Business continuity IT security Financial risks Currency risks Capital availability and liquidity risks Regulatory risks Tax Increasing legislation,Summary of Geographical Distribution of Consolidate Beer Volume,Qustion1. Describe the fundamental issues in foreign market analysis for a firm like Heineken ?,1. Foreign Market Analysis Heineken has to determine market research carefully that normally follow three steps: Assess Alternative Foreign Markets A. Market Potential B. Levels of competition C. Legal and Political Environment D. Sociocultural Influence Evaluate the respective costs, benefit and risks of entering Select the target that embraces the most potential for entry or expansion,2. Choosing Entry ModeHeineken analyzed market and using the Mode of Entry wisely. They choose different modes in different target markets upon the decision factors and appropriate combination. 3. Exporting to Foreign Markets Concern both advantages and disadvantages accordingto the different markets.,Question2. Discuss the advantages or disadvantages for Heineken or exporting its beer from one country to another?,AdvantagesRelatively low financial exposure Heineken can control financial to host countries.Employ domestic firm to distribute product.Domestic firms have better control their marketingRaise selling prices because middlemen were eliminated.,Question2. Discuss the advantages or disadvantages for Heineken or exporting its beer from one country to another?,Assess the market gradually until be accepted and experienced well to expand.Can take over local distributor or build factory that can reduce costs of production and distributions.Have proactive/ reactive motivation for exporting.Avoid restriction on foreign investment. Direct exporting help Heineken to avoid some country restriction for foreign investment. Decrease the entry barrier and operation cost in foreign country.,These global markets show Heineken exporting advantages : Europe: First, exported to France, Italy, Germany and Far East. Licensing in UK. - gradually entered market - then took acquisition some breweries in Europe to expand productions and distributions. Next, Closed 10 older plants to reduce operation costs Modernized 6 breweries to integrate distribution system management.,Question2. Discuss the advantages or disadvantages for Heineken or exporting its beer from one country to another?,USA: Eliminate cost efficiently by licensed to Van Munching & Company that cheaper than establish the production there. Avoided tariff or quota barriers. Keep brand image of original import beer to American customers. Next, it bought Van Munching & Company and renamed to Heineken USA as its distributor.,