A Case Guide of the Global Beer Industry

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Case Study Assignment 3

|What are the dominant business and economic characteristics of the global beer industry? | |The global beer industry is dominated by large corporations who have merged with rivals to increase their global and domestic market share. | |For example in 2004 Interbrew and AmBev merged to form the worlds largest brewing company in terms of volume ( ).Since then Miller | |Brewing has merged with Coors Brewing company and SAB to form one of the worlds largest breweries. | |What do you see as the key success factors for firms in the global beer industry? | |Quantities of scale, high-volume, and international alliances for fast and easy entry into new markets. | |What does a strategic group map of the global beer industry look like? How strongly is Grupo Modelo positioned in the industry? How | |favorably does it compare with its closest Mexican rival FEMSA? How favorably does Grupo Modelo's position compare to that of Heineken? | |A strategic group map of the global beer industry would contain Anheuser-Busch, InBev, SABMiller, Heineken and Modelo. It would contrast | |sales volume versus distribution strategy. | |Grupo Modelo is positioned strongly in this industry because of it's large share of the US Market, however, it's vulnerable to the larger, | |more powerful companies and the result of their mergers. Grupo Modelo is much stronger than it's closest Mexican rival FEMSA. FEMSA has | |utilized their distribution channels to gain a significant share of the domestic market, but they have been unable to rival Modelo's success| |overseas. FEMSA has a competitive advantage in Mexico, but overall Grupo Modelo remains the stronger company. | |Heineken has a greater share of the global market, however, Grupo Modelo's takeover of the US market is a successful blueprint of their | |ability to challenge Heineken on a larger scale. For now Heineken remains the larger brewing company, but they are being heavily pressured | |by Grupo Modelo. Their recent alliance with Modelo's Mexican rival has allowed them to re-take some of the US market. Modelo is a more | |powerful emerging force, but they have a long way to overtake Heineken's global presence. | | | |What are the resource strengths and weaknesses of Grupo Modelo? What competencies and capabilities does it have that its chief rivals don't | |have? What market opportunities does Grupo Modelo have? What threats do you see to the company's future well being? What conclusions can we | |draw from the SWOT analysis for Grupo Modelo? | |Grupo Modelo's competencies include unique, clear, glass bottles, and brilliant marketing campaigns like, “fun in the sun”. The North | |American Free Trade Agreement allows them to sell beer cheaper than their closest competitor, Heineken. This has given Modelo a competitive| |advantage in America over it's rivals. This large market share of America increases their global volume and increased their economics of | |scale. However, updated research shows Heineken has purchased Modelo's chief Mexican rival, FEMSA, and consequently poses an even a greater | |threat to Modelo's domestic and foreign markets (Berkowitz and Blenkinsop 2010) | |...
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