Tobacco Industry

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  • Topic: Altria Group, Tobacco, Tobacco industry
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  • Published : May 25, 2013
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INDUSTRY REPORT

TOBACCO INDUSTRY

Outline
I Introduction
II Main body
A. The products provided
B. Top five firms in the industry
a. The firm’s value of sales
b. The number of people employed
c. The amount of capital invested
C. The problems in the industry
a. Changes in government controls
1. The initiatives by the WHO
2. The new laws by the world governments directed to raising the prices for tobacco products along with raising the percentage of taxes for the companies in the industry D. The strategies of firms in the industry purposed for solving the emerged problems E. The prospective of the industry

III Conclusion

Industry Report
Since the date of its formation, tobacco industry appears to be one of the most successful and profitable industries. Every year, more than 5 000 000 000 000 cigarettes are produced in the world. Around 300 billion US dollars are earned by the companies in the industry. In the following paper, the current situation in this business area will be examined.

The products provided by the industry are cigarettes, smokables, snuffing tobacco and the other related goods.

Top five firms in the industry
Top five firms in the industry are China National Tobacco Co., Philip Morris International Inc (Altria Group Inc), British American Tobacco, Japan Tobacco International and Imperial Tobacco Group.

• China National Tobacco Co.
China National Tobacco Co. is the monopolist in the industry. More than 33 % of world tobacco products are manufactured by this company (China National Statistics Bureau Yearbook 2010). The company is owned by the government of China, and is located in the city of Beijing, which is one of the biggest industrial cities both in the world and in the country. The company’s value of sales is around 32 billion US dollars (China National Statistics Bureau Yearbook 2010). Around 500 thousands of people are employed in this company which comprises 0.4 % of total employment in China (China National Statistics Bureau Yearbook 2010). The amount of capital invested is approximately 4.18 billion US dollars (China National Statistics Bureau Yearbook 2010).

• Philip Morris International Inc (Altria Group Inc)
Philip Morris International Inc (Altria Group Inc) is the second largest company in the industry. It is located in New York City, USA. The company holds 17.6% of global market (Masina 2010). Its revenue is 89.8 billion US dollars annually. The number of people employed is 200 thousand. The amount of capital invested is 2.7 billion US dollars (Masina 2010).

• British American Tobacco
British American Tobacco located in London is the third largest company in the industry with the annual value of sales of 43.0 billion US dollars which comprises 15.1% of the world’s market. The number of people employed is 100 thousand. The amount of capital invested is 2.2 billion US dollars.

• Japan Tobacco International
Japan Tobacco International located in Geneva, Switzerland is the fourth largest company in the industry occupying 6.4% of the global market. Each year, the value of sales reaches 39.6 billion US dollars (Masina 2010). The number of people employed is 60 thousand. The amount of the capital invested is 1.4 billion US dollars (Masina 2010).

• Imperial Tobacco Group
Imperial Tobacco Group located in Bristol, England is the fifth largest company in the industry with the annual value of sales of 25.2 billion US dollars (Masina 2010). The company holds 3.7 % of global market. The number of personnel employed is 25 thousand people. The amount of invested capital is 1.1 billion US dollars (Masina 2010).

The problems in the industry
The problems in the industry are not many as its products are in constant demand by the population of the entire world. However, the industry still has its major problem coming from the...
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