"Heineken UK is United Kingdom's leader in beer and cider business. It is an operating company under Heineken N.V. which is the world's largest brewer. Heineken UK was formed in 2008 when the parent company acquired the UK business of Scottish & Newcastle PLC. The company employs around 2300 people across UK and is the brewer, cider maker and distributor of alcoholic drinks and manages 1300 pubs through their S&N Pub Company business. The head office in UK is located in Edinburgh.
In June 2010, Heineken UK sold its wholesale business Waverly TBS; this transaction resulted in a profit of 199 million euro to the company. The cost reduction programme of the company has recently led to 280 million euro worth of savings. The revenue for the last financial year increased from 14.7 billion euro to 16.1 billion euro; an increase of 9.7 per cent. The company has increased its marketing and selling expenses in the UK due to the overall low selling seen in the international market. The increase has been drastic up to12.8 percent from 5.4 per cent.
The company is focusing towards volume and value share growth in the European market by increasing investments in marketing and innovation. Like in the USA, even the UK market has not reflected a good picture in the first half of the year due to the economic slowdown and job losses that is being witnessed. Heineken, though being a large player in the beer market; has to face other competitors in the market. The UK also consists of companies like United Breweries who have many famous brands to boast of when compared to Heineken. The company has to come up with innovative strategies to attract the young customers and create brand loyalty among them.
Heineken is a favorite brand in the UK due to its history in the European region. But the amount of market share that it holds is not enough for a product to be holding in its domestic market. Increasing the line of brands and marketing its existing brands which do not perform on par is what Heineken has to look out for, it has to plan by anticipating the future of the country in mind. The natural and economic disturbances have been disturbing the performance of the company for sometime in the country, Will Heineken strategically think and implement steps to improve its stand in the UK market?"
[...] Falsified claims and higher customer lawsuits will hamper EBITDA margins. ➢ Product recall and damaged goods distributed to consumers will hamper long-term competitive advantage. Heineken NV Risk Map (2012) Disclaimer: The risk map is prepared on our assumptions and is not taken from any public announcement or article. Source: Annual Report (2011) Corporate Social Responsibility- Greener and shareholder value pyramid Before 1994, majority of corporations started enhancing shareholder value to enhance long term sustainability. This was necessary due to fierce competitive pressures, price sensitive marketspaces and availability of scarce capital (Takala & Pallab, 2000, p. [...]
[...] Sol was introduced into core European markets. ➢ Promotional: The company has been restructuring its brand positioning and equity via digital collaboration and sponsorship agreements with large events worldwide. In 2011, it reshaped its brand image to “Open Your World” on worldwide basis to standardize its positioning across 70 countries. It further, launched flagship offline and online promotional campaigns “The Entrance and The Date” across 50 countries worldwide. It extended strategic digital partnership with Google and Facebook along with sponsorship contracts with UEFA 2011 and The Rugby Worldcup 2011 in New Zealand. [...]
[...] Heineken is the flagship brand with annual production of 2.74 billion liters in 2011. Amstel and Foster's are the secondary brands of Heineken NV worldwide with volume sales of 8.7 and 8.1 million liters respectively in 2010-2011. Strongbow is leading cider brand in United Kingdom, with volume share of 20%. Europe is the biggest marketspace for Heineken BV accounting for 55.2% of total group beer volume sales. The company is publicly listed on Euronext Amsterdam Stock Exchange, with market capitalization of €24.6 billion (April 2012). [...]
[...] ➢ Higher fluctuation in commodities marketspace will hamper operating margins. ➢ ABI and SABMiller Group Plc are the core competitors for Heineken NV across global and European beer marketspace. In 2011, SABMiller Group Plc was offering discount centric pricing in emerging markets to improve volume share. Cheaper product portfolio in price sensitive and fragmented local marketspace will hamper competitive advantage. ➢ Counterfeit brands to hamper brand loyalty and enhance customer litigation expenses: In emerging markets such as India, small illegal beer manufacturers offer counterfeit brands such as copy of Foster's label hampering sustainability of large brewers such as Heineken NV. [...]
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