Global beer market analysis

Graduate School of Management and Technology, University of Maryland University College and Tecnologico de Monterrey

Managing Strategy in the Global Marketplace: NAFTA Focus Special Course
Spring 2011 Semester

Final Team Project:
Global Beer Market.


Team: MARTEC
Piper Oneto
Sean Cunningham
David Calvo

Global Industry Profile 3
Market Overview 3
Market Value 4Market Segmentation 4
Market Share 5
Leading Companies 5
Market Forecast 5
US Industry Analysis 6
Porter´s Five Forces Model to US Beer Market 6
PEST Analysis 9
Product Life Cycle (Levitt) 10
Client Company Overview 11
Resource Based View of the Firm 12
SWOT Analysis 12
BCG Matrix 13
McKinsey Matrix / GE Business Screen 14
Competitive Advantage 14
Business StrategicQuestions 15
Describe the strategic priorities of your client company and the important challenges facing it and the industry. 15
Project the comparative market size of the industry in each of the NAFTA countries by 2014. How might that impact your decision on prioritizing the countries in your global business strategy? 16
Who are some of the key competitors (both multinational and local) in yourselected industry in each of the NAFTA countries and how competitive is the industry in each country, and how might that impact your decision on prioritizing the countries in your global business strategy? 17
Develop a rationale for adjusting the discount rate in the capital budgeting process to incorporate consideration of country risk 18
References 18
Background Information and AnalysisGlobal structure and environment of Brewer Industry
Market Overview
The global brewing sector consists of the total revenues generated through the sale of beer, cider and flavored alcoholic beverages (FABs). Global brewer´s market consists of North America, South America, Western Europe, Eastern Europe, and Asia-Pacific.

Brewer industry is in Consumer Goods sector, specifically in BeveragesIndustry. In Table 1 we can see Brewer´s industry returns. It has good returns on medium and long term, higher than Soft Drinks Industry and Wineries Industry.
Going a bit deeper in this overview, if we compare EVA of 3 biggest brewers, we find that Anheuser and SAB Miller have EVA higher than 6% what means they are in Oligopoly Competition. These 3 major Brewers own 44% of Global Market Share.Of course the number of companies playing in this industry is quite large, since local breweries to global companies like the ones we mentioned before.

Market Value
The global brewers market grew by 1.5% in 2009 to reach a value of $545.8 billion. The compound annual growth rate of the industry in the period 2005–09 was 2.2%.

Market Segmentation
Beer is the largest segment of the globalbrewers Industry, accounting for 94.2% of the sector's total value.

Europe accounts for 48.9% of the global brewers’ industry value. Americas accounts for a further 25.3% of the global sector.

Market Share
Anheuser-Busch InBev is the leader in the global brewers industry, generating a 22.5% share of the sector's volume. SABMiller accounts for a further 12.8% of the sector. The 3 biggestbrewers account 43.9% of global market.

Leading Companies
There are 3 main players in global brewer Industry:
Anheuser-Busch InBev. The company has 22.5% of global market and offers a portfolio of over 300 brands that includes global flagship brands Budweiser, Stella Artois, Quilmes and Beck's.
Heineken. With 8.6% of global market, this company brews and sells more than 200 varieties ofinternational premiums, regional, local and specialty beers. Its principal brands are Heineken, Amstel, Birra Moretti, Cruzcampo and Foster's.

SABMiller. With 12.8% SABMiller offers brands such as Pilsner Urquell, Peroni Nastro Azzurro, Grolsch and Miller Genuine Draft.
Market Forecast
According to Datamonitor´s brewer market profile 2010, In 2014 the global brewers sector is forecast to have a...