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ANHEUSER BUSCH COMPANIES INC Louise Philbrick Keith Grant David Guerra All pictures from anheuserbusch com Overview

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ANHEUSER BUSCH COMPANIES INC Louise Philbrick Keith Grant David Guerra All pictures from anheuserbusch com Overview Powered By Docstoc
					ANHEUSER-BUSCH COMPANIES, INC.




              Louise Philbrick
                Keith Grant
               David Guerra
       All pictures from anheuserbusch.com
                 Overview
 History              Strategic analysis
Who we are today      SWOT Matrix
                      Space Matrix
Vision and Mission
                      Grand Strategy Matrix
External Audit        BCG
 EFE                  IE Matrix
 CPM                  Strategic Summary
Internal Audit        Possible Strategies
 IFE                  QSPM
                      Decisions
                      Implementation
                     History

• 1852- George Schneider
  founded Bavarian
  Brewery in St.Louis
  Missouri
• 1857- Adolphus Busch
  arrived in St. Louis
• 1860- Eberhard Anheuser
  acquired Bavarian
  Brewery
                      History
• 1870’s
   Production: 18,000 Barrels
   Anheuser Busch became 1st
     U.S. Brewery to adopt the
     use of pasteurization
   40 Refrigerated railcars
• 1880’s
   Acquired rights to bottle and
     sell Budweiser(01-24-1880)
   Production: 739,951 Barrels
                      History
• 1881
   – Adolphus Busch
     Glass
     Manufacturing
     Company began
     Production
                       History
• 1901
   – 1st time to break the
     million barrel mark
     within a year
     1,006,494
• 1920
   – Jan 16th National
     Prohibition took affect
   – Began production of
     other goods ex: ginger
     ale, root beer, ice
     cream, and malt syrup
• 1933
   – Prohibition repealed
                   History
1940- surpassed the three million
barrel mark
1953- Clydesdales first appeared in
the tournament of Roses Parade
1961- Michelob was for the first
time sold in bottles
                      History
• 1974
  – The 30 million barrel
    mark was passed
• 1980
  – Anheuser Busch
    signed a licensing
    agreement with
    Labette Brewing
    Company of Canada
    to brew and sell
    Budweiser in Canada
                       History
• 1991
  Federal excise tax
  doubled on beer
• 2000
  20th Anniversary of
  companies listing on
  NYSE
  Total global volume 121.3
  million barrels
• 2001
   Bud light became the #1
     selling beer in the U.S.
• 2002
   Anheuser Busch 150th
     Anniversary
          Who we are Today
• Anheuser-Busch
  Companies business
  segments consist of:
  domestic beer,
  international beer,
  packaging,
  entertainment and
  other.
           Who We Are Today
• The domestic beer segment consists of the Company's
  United States beer manufacturing and wholesale sales
  operations.
• ABI has 12 deliberately placed domestic breweries to
  maintain an effective nationwide distribution.
• Besides its St. Louis headquarters, Anheuser-Busch Inc.
  operates breweries in Baldwinsville, N.Y.; Cartersville,
  Ga.; Columbus, Ohio; Fort Collins, Colo.; Houston;
  Jacksonville, Fla.; Los Angeles; Fairfield, Calif.;
  Merrimack, N.H.; Newark, N.J.; and Williamsburg, Va.
• ABI sells approximately 2.5 times the volume of its
  closest domestic competitor
           Who We Are Today
• The international beer segment consists of
  export sales and overseas beer production
  and marketing operations, administration of
  contract and license brewing arrangements
  and equity investments.
• In 2002 global sales reached 8 million
  barrels
• ABI has established business with China,
  Japan, Brazil, India, Italy, France,
  Switzerland, and Spain since 1993
• They have expanded their international
  market so much because of all the changes
  i.e.. growing prosperity in Latin America,
  and nations shifting their preference from
  traditional wine drinking towards beer
          Who We are Today
• The packaging segment is composed of the Company's
  aluminum beverage can and lid manufacturing,
  aluminum recycling, label printing and glass
  manufacturing operations.
• Anheuser Busch is the world’s largest recycler of
  aluminum beverage containers
            Who We are Today
• The firms packaging operations are handled through the
  following subsidiaries
  Metal Container corporation
      Manufactures cans and lids for ABI
  Anheuser-Busch Recycling Center
      Recycles aluminum cans at the plant located in CA.
      Is the world largest recycler of aluminum cans, also
      help to reduce production cost
         Who We are Today
Precision Printing and Packaging
   Produces more than 25 million labels for ABI and
   other companies at its location in Tennessee.
   Provides 80% of Anheuser – Busch’s labels
Eagle Packaging Inc.
   Supplies all ABI liner material.
Longhorn Glass Corporation
   Produces over 60% of the glass bottles that are used
   in the Huston brewery.
           Who We are Today
• The entertainment segment consists of its theme park
  operations, and real estate operations.
• Busch Entertainment Corporation (BEC) operates
  Busch gardens in three cities, Sea World in three cities,
  along with Adventure Island, Water Country USA,
  Sesame Place, and Discovery Cove.
          Who we are Today
• Anheuser Busch
  subsidiary Busch
  Properties Inc. (BPI)
  owns and operates The
  Kingsmill Resort and
  Conference Center in
  Virginia.
               Competitors
• The Miller Brewing       • The Adolph Coors
  Company                    Brewing Company
• 2nd largest brewery in   • 3rd largest brewery in
  the US is the              the country
• With sales in over 80    • Among Coors product
  countries                  Coors Light is the 4th
• Offers over 50 brands      largest selling beer in
  of beer                    the nation
            Vision Statement

• “through all of our products, services and
  relationships, we will add to life’s enjoyment”
    Current Mission Statement

 Anheuser-Busch’s mission is to ensure the
  following three goals are met
   • Be the World’s beer company
   • Enrich and entertain a global audience
   • Deliver superior returns to our shareholders
   Proposed Mission Statement
 Anheuser-Busch Companies, Inc. is a global
  company (3) that is committed to being the leader in
  both domestic and international beer markets,
  enriching and entertaining a global audience, and
  delivering superior returns to our shareholders with
  strategic real estate investments and packaging
  operations (2,7). Through technologically improved
  (4) products and services (4) Anheuser strives to
  achieve sustainable growth and profits for all
  stakeholders (5,9). We emphasize responsible
  consumption, preservation and protection of the
  environment, and exceeding customer expectations
  in all our operations (6,8).
                           External Audit
Opportunities                                 Threats
•   Governmental restrictions are much        • The domestic beer marketplace is
    lower in the countries that Anheuser-        highly regulated
    Busch is expanding to                     • There have been sharp increases in
•   There has been a noticeable shift in         federal excise taxes on alcoholic
    consumer preferences toward beer             beverages
    in traditional wine-drinking countries.   • International breweries and
•   An expected increase in the                  microbreweries expanding into the
    domestic number of beer drinkers             USA
    over 21 should contribute an              • Domestic population only increases at
    additional 1% annual gain in beer            an annual rate of about one percent.
    sales for the next few years                 (limited growth potential for domestic
•   Demand for American brews in Asia,           beer and entertainment operations)
    Latin America, and Europe is              • Changes in people’s disposable
    growing                                      income may have unfavorable effects
•   Quickly growing populations in
    developing international markets
•   Americans have experienced annual
    increases in disposable income
    since 2000.
                          EFE Matrix
Key External Factors                            Weight   Rating   Weighte
                                                                  d Score
Opportunities
1. Governmental restrictions on beer exist in   0.25     4        1.00
countries into which A-B is expanding
2. Noticeable shift in consumer preferences     0.05     3        0.15
towards beer
3. An expected increase in the domestic         0.075    2        0.15
number of beer drinkers over 21 should
contribute additional 1% annual gain in beer
sales for the next 3 years
4. Demand for American brews in Asia, Latin     0.1      4        0.4
America, and Europe is increasing
5. Quickly growing populations in developing    0.1      3        0.3
international markets
6. Americans have experienced annual            0.025    3        0.075
increases in disposable income since 2000
                           EFE Matrix
Threats                                       Weight   Rating   Weighted
                                                                Score
1. The domestic beer marketplace is highly    0.25     2        0.5
regulated
2. There have been sharp increases in federal 0.025    2        0.05
excise taxes on alcoholic beverages
3. There have been sharp increases in federal 0.075    2        0.15
excise taxes on alcoholic beverages
4. Domestic population only increases at an   0.025    2        0.05
annual rate of about one percent. (limited
growth potential for domestic beer and
entertainment operations)
5. Changes in people’s disposable income      0.025    3        0.075
may have unfavorable effects
Total                                         1.00              2.9
Competitive Profile Matrix
IFE Matrix
Financial Ratio Analysis
                           SWOT Matrix
S-O Strategies                                 W-O Strategies
1. Reinvest in core business to improve        1. Increase preventative education
efficiency and add capacity as needed          expenses to maintain good public image

2. Increase equity investment in Tsingtao of
China and CCU of Chile

S-T Strategies                                 W-T Strategies
1. Adjust pricing strategy to offset excise    1. Adjust policies and procedures regarding
taxes                                          derivatives and hedging in the event of
                                               potentially negative foreign currency
                                               exchange
2. Continue dominating market share
through extensive advertising
               Space Matrix

Conservative                      Aggressive




Defensive                     Competitive
BCG Matrix
IE Matrix
               Grand Strategy Matrix
                                   RAPID MARKET GROWTH

                    Quadrant II                          Quadrant I




WEAK                                                                   STRONG
COMPETITIVE                                                            COMPETITIVE
POSITION                                                               POSITION
 Strategies                                       Anheuser-Busch
 1. Concentric
 diversification
 2. Horizontal      Quadrant III                         Quadrant IV
 diversification
 3. Conglomerate                   SLOW MARKET GROWTH
 diversification
 4. Joint venture
              Net Worth Analysis
SE + Additional paid in capital + retained earnings
                $3.052B + $1.025B + $12.544B
     $16.62B
12/31/02 Net Income x 5
$1.934B x 5 =
       $9.67B
Share Price (1/1/02) / EPS (1/1/02) x avg. net income (3 years)
                $45.21 / 1.91 x 1.73B
     $4.09B
Number of shares outstanding x share price
                866M x $48.40 =
     $4.19B
Method average =
     $8.64B
                   Strategic Summary
Alternative Strategies         IE       Space   Grand   Total
Forward Integration                 X     X               2
Backward Integration                X     X               2
Horizontal Integration              X     X               2
Market Penetration                  X     X               2
Market Development                  X     X               2
Product Development                 X     X               2
Concentric Diversification                X       X       2
Conglomerate Diversification              X       X       2
Horizontal Diversification                X       X       2
Joint Venture                                     X       1
           Possible Strategies
• Increase presence in Asian, eastern
  European, and Latin American
  markets
• Unload less profitable theme parks
  and possibly expand the more
  profitable parks
• Continue to dominate market share
  with extensive advertising
• Increase education on responsible
  consumption to maintain good public
  image
QSPM
QSPM
                   Decisions
• Primary
   – Increase presence and awareness in
     Asian, eastern European, and Latin
     American markets
• Possibilities
   – Continue to dominate market share
     with extensive advertising
   – Increase education on responsible
     consumption to maintain good public
     image
   – Unload less profitable theme parks
     and possibly expand the more
     profitable parks
               Implementation
• Invest $182 million over three years in Tsingtao
  Brewery Company, Ltd. Of China. This investment
  will increase Anheuser-Busch’s equity interest to
  27% of Tsingtao.
• Invest if needed $165 million in Compania
  Cervecerias Unidas S.A. (CCU), the largest
  brewery in Chile. This investment would increase
  Anheuser-Busch’s equity interest in CCU from
  20% to 30%, and would make Anheuser-Busch
  products more available in the Latin American
  markets.
Anheuser-Busch in the Media

				
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