Anheuser-Busch and Harbin Brewery Group Case Study

Anheuser-Busch and Harbin Brewery concourse - Case Study ExampleHarbin Brewery acquisition greet was the in full(prenominal) spiritsest in China years 2002-2004 and scotched for $28.4 mm.Harbin Brewery was the leader in selling beer in all three segments in Heilongjiang where the per capita consumption was 36 liters, double the national average. However, the high consumption rate has left no opportunity for further growth and the company was forced either to live with the existing sales level or to expand nationally. The acquisition by Anheuser-Busch allowed Harbin Brewery to meet its growth objectives and gain national identity.B/C. Governance and Top Management Anheuser-Busch, being very interested in expanding to China, has experienced the do of small and big acquisitions of the national and regional breweries. Chinese beer mart is very fragmented and the top five firms account only for 38 percent of the market. Anheuser-Busch has bought the minority ownership position in th e Tsingtao premier brewer on 2002 in order to gain the access to brewing capacities and distribution channels. Harbin Brewery Group has also experienced numerous ownership changes since 2001. In 2002 the firm has went public with 41 percent of shares distributed to public. On June 1 2004 Anheuser-Busch held 37.4 percent in Harbin. The current chief operating officer of Harbin is Peter Lo who has supported the acquisition of his firm by Anheuser-Busch and is expecting to experience significant expansion of Harbin brands on the national and international markets. II. External surroundings (Opportunities and Threats)A. General Environment Chinese beer market is the greatest in the world since late 1990s with the solid sales growth of more than 40 percent in the new five years. With the largest sales volume globally, the average sales price is still relatively low, confirming the growth potential for domestic and foreign brewers. In addition, in that respect is significant growth in the target population for beer and rise in the average income. Chinese consumers do not have loyalty to the particular brands, eon they favor the domestic brews (99.5 percent of all consumed beer). The acquisition of Harbin by Anheuser-Busch and low level of competition, gives the company the opportunity to gain the loyalty of major segment of beer consumers. B/C. Industry Environment and Summary of External Forces In overall the Chinese beer market is very attractive - the growth of sales and increasing number of consumers reduces the number of competitors. Even though the threat of substitute is high, the supplier power threat is not significant. Nevertheless, the manufacturing infrastructure and personnel problems make it almost impossible for Harbin to uniform the high quality of the product. III. Internal Environment (Strengths and Weaknesses)A/B Corporate Structure and Culture The Harbin Brewery, as the part of Anheuser-Busch, did not change the structure and culture. Taking into account the current problems with personnel training and lack of skilled professionals, the workforce is culturally diverse. C. Organizational Activities Analysis Harbin is not outperforming its competitors (Tsingtao, China Resources Enterprises, Beijing Yanjing Group, and Guangzhou) from both financial and market