bus 417c group f_4

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BUS417C: ISSUES IN BUSINESS

PRACTICE

Section 11 Group F

Miss Vicky Au 103553C Miss Carmen Lui 103581C Miss Gillian Chiu 103574C Miss Jane Wong 103544C

Mr Damon Chan 103515C

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History of Heineken 1864 Founded 1968 Foreign Guest in Europe

Top Import in Premium SegmentBegin Producing Beer within European Countries

1971 Expanding Roster of Interests 1979 Market Leader in Europe through many acquisitions

Fine Tune Communication and Productse.g. English are used to weak dark ales

2007 Heineken and Carlsberg confirm their intention to make an offer forthe entire issued share capital of Scottish & Newcastle plc.

2008 In January 2008, after negotiation, the S&N boardrecommends to their shareholders that they accept the

offer of 7.8 billion.On 28th April, 2008 Scottish & Newcastle plc ceases to trade as a publiccompany.

-History of Heinekenhttp://www.heinekeninternational.com/timeline.aspx

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Model of Entry & Choice

1. Export

2. Licensing

3. Acquisition

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Model of Entry & Choice Export- Advantages

Relatively low financial exposure

Permit gradual market entryAcquire knowledge about local market

Avoid restrictions on foreign investment

- http://www.singtao.ca/financial/2008-01-29/1201633778d793020.html

- http://www.stnn.cc:82/cnstocks/200801/t20080128_721181.html
http://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.stnn.cc:82/cnstocks/200801/t20080128_721181.htmlhttp://www.stnn.cc:82/cnstocks/200801/t20080128_721181.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.html

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Model of Entry & Choice Export- Disadvantages

Vulnerability to tariffs and NTBs

Logistical complexities

Potential conflicts with distributors


http://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.stnn.cc:82/cnstocks/200801/t20080128_721181.htmlhttp://www.stnn.cc:82/cnstocks/200801/t20080128_721181.htmlhttp://www.stnn.cc:82/cnstocks/200801/t20080128_721181.htmlhttp://www.stnn.cc:82/cnstocks/200801/t20080128_721181.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.htmlhttp://www.singtao.ca/financial/2008-01-29/1201633778d793020.html

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Model of Entry and Choice Strategic Alliance

- Advantage

Ease of Market Entry

Shared RiskShared Knowledge and Expertise

Synergy and Competitive Advantage

- Disadvantage

Decision Making (Carlsbery 54%, Heineken 46%)



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Model of Entry and Choice Acquisition

- Advantage

Quickly gives the purchaser control over the firms factories,

employees, technology, Brand names, and distribution networks- Disadvantage

The purchaser assumes all liabilities of the acquired firm



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PESTAL Analysis Political and Legal

- Tax for imported beer = Tax for local manufactured

beer- New Law for alcoholic

http://www.bbc.co.uk/zhongwen/trad/uk/2010/07/1007

21_lifeukbeer_pa.shtmlhttp://www.takungpao.com.hk/news/10/01/20/YM-

1204081.htm
http://www.bbc.co.uk/zhongwen/trad/uk/2010/07/100721_lifeukbeer_pa.shtmlhttp://www.bbc.co.uk/zhongwen/trad/uk/2010/07/100721_lifeukbeer_pa.shtmlhttp://www.takungpao.com.hk/news/10/01/20/YM-1204081.htmhttp://www.takungpao.com.hk/news/10/01/20/YM-1204081.htmhttp://www.takungpao.com.hk/news/10/01/20/YM-1204081.htmhttp://www.takungpao.com.hk/news/10/01/20/YM-1204081.htmhttp://www.takungpao.com.hk/news/10/01/20/YM-1204081.htmhttp://www.bbc.co.uk/zhongwen/trad/uk/2010/07/100721_lifeukbeer_pa.shtmlhttp://www.bbc.co.uk/zhongwen/trad/uk/2010/07/100721_lifeukbeer_pa.shtml

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PESTAL Analysis Economic

- Unemployment rate high (7.7% 2011 2-4 while HK around3%)and will be an impact for Premium price of Heineken

- Distribution Channel:Heinekens acquisition of parts of S&N includesbusinesses, licences and investments in Belgium, Finland,India, Ireland, Portugal, the UK and the US, with corebrands including Fosters, Kronenbourg 1664, John Smiths,

Newcastle Brown Ale, Sagres, Lapin Kulta, Maes andBeamish.http://www.bbc.co.uk/zhongwen/trad/uk/2010/07/100721_lif

eukbeer_pa.shtmlhttp://www.takungpao.com.hk/news/10/01/20/YM-

1204081.htm

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PESTAL Analysis Social Culture

- Used to weak dark ales and traditional UK style beer

- Local Brand- Prefer Local brand, support high quality and localbeer (Campaign for Real Ale, Camra)

http://www.bbc.co.uk/zhongwen/trad/uk/2010/07/1007

21_lifeukbeer_pa.shtmlhttp://www.takungpao.com.hk/news/10/01/20/YM-

1204081.htm

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PESTAL Analysis Technology

- S& N Technology (Strongbow)

- Machineryhttp://www.bbc.co.uk/zhongwen/trad/uk/2010/07/1007

21_lifeukbeer_pa.shtml

http://www.takungpao.com.hk/news/10/01/20/YM-

1204081.htm

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Conclusion Export => Strategic Alliance and Acquisition

Base on Economic and Social Cultural factor

Largest market share in UK and some EuropeanCountry

Proper

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Thank you

bus 417c group f_4

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