South African Breweries
... Brewing companies are focusing on becoming global by acquiring breweries, creating strategic alliances and/or joint ventures in order to compete in this evolving market. ... SAB has a 98 percent share of the South African market but that could change easily if an international competitor can penetrate the South African market with lower prices and strong distribution channel. International competitors can form strategic alliances or joint ventures with breweries in South Africa that can steal market share from SAB, such as microbrewers, premium brands, or even substitute products like spirits and wine. ... Weaknesses SABMiller has some weaknesses such as no clear dominant brand name, advertising, currency fluctuations, and reliance in South Africa. ... SABMiller holds a ninety percent market share in South Africa, “Achilles heel,” that can become attractive to rival brewing companies. ... ” We consider the large market share in South Africa as an “Achilles heel” because SABMiller uses a lot of the financial gains from this market to enter into new markets and to finance other operations in the company. ... The brewing industry is in the continual process of becoming a global industry, consumer tastes are beginning to converge across national borders and breweries are finding it easier to access foreign markets because of partnerships and low tariffs. SABMiller continues to introduce new products into the market such as Sky Blue (introduced in North America), Sterling Light Lager, Copper Crest, and Eagle which have been introduced into South Africa market. ... Threats Threats to SABMiller include global economic and socio-political outlook remains uncertain, competitive entry into South Africa, governmental regulations/restrictions, and currency fluctuations. ... Competitors can begin to penetrate into South Africa stealing market share. ... Power Point Slides Strengths- geographic reach, quality brand portfolio, widespread distribution network and financial strength, environmental efficiency, less waste 90% recycling, alliances/joint ventures, focused low cost, and strong management team Weaknesses- no clear dominant brand name, advertising, technology, currency fluctuations, and reliance on South Africa. Opportunities- consolidation of brewing industry, product innovations, strategic alliances, and penetration into new markets Threats- Global economic and socio-political outlook remains uncertain, competitive entry into South Africa, governmental regulations/restrictions, and currency fluctuations Strategic Group Map The below picture is a strategic group map depicted by our findings. ... Growth in South Africa, and Europe 2. ... Continue to innovate new products: Success in South Africa with Brutal Fruit and Sterling Light, in Poland and East Africa with Redd’s. ... 9 billion in sales in US Target Markets New products being introduced in South Africa