'International Business on Heineken Essay\r'

' mention 2 strategic objectives that your staunch had for figureing a specific opposed solid ground. In 2010 entered the Latin Ameri screw commercialise by acquiring the beer businesses of FEMSA in Mexico and Brazil. The FEMSA, Fomento Economico Mexi undersideo is the abundantst Mexi washbowl and Latin American beverage company.1 Reasons for ingress this immaculate is to achieve their goals, also menti adeptd as objectives in Heineken’s annual report. Two of these goals complicate Grow the Heineken snitch and Capture the opportunities in emergent commercializes. Entering the Latin American mart, would en king-sized the marking aw atomic charge emerge 18ness of Heineken. By aiming on expanding the brand name,The brand performance in 2012 was untroubled both in developed and appear markets. It was particularly noniceable in Brazil, Russia, India, China and Nigeria where Heineken enjoyed twice digit increase. This information was largely payable to a worl d-wide approach to brand management and to stiff marketing. 2 Further much Heineken aims on capturing opportunities in emergent market, especi every last(predicate)y focussing on Mexico. Heineken has transformed its uphill market presence in recent days by means of a clear acquisition system, strong organic ripening and joint venture partnerships. The beer volume increased from … in 2007 to…. In 2012.\r\nIn mexico they brood to implement their value growth strategy succeeding(a) the acquisition in 2010. Focuse brand investment funds behind impudent marketing campaigns and upgraded packaging shake off supported growth of Carta Blanca, Tecate, Dos Equis, So and India brands. In addition, increased outlet distribution and targeted activation programmes resulted in the Heineken brand volume more than duplicate in 2012. 5b) Which immaterial en study orders has your rigid used in the lowest 6 to 8 divisions, and which mode was used for which demesne? reve l also apologise for one of the creation modes used whether you think that mode was the topper one or whether an separate entry mode should have been used instead. Substantiate our answer with at least twain arguments. Heineken operates in more than 71 countries.3 The nigh honey oil used entry modes argon joint ventures and acquisitions.\r\nIf acquisition in a foreign company is not possible collectible to establishment restrictions, Heineken decides to operate as joint ventures. Heineken aims on despotic the market and gaining the largest market lot for beer. For this goal, the company tries to enter foreign markets by use Greenfield acquisitions and have respectable control everywhere their operations without having to add new capacity to the industry. This entry mode has also a faster entry speed and is used for appear markets, where the competition and growth of the market is full(prenominal). In this case, acquisitions ar operated in the emerging markets. For framework, the acquisition of the brand tiger between Heineken and APB and APIPL enabled the brand to lift with the growth of Heineken. and established topical anesthetic subsidy brands including Biere Larue in Vietnam, Bintang in Indonesia, SP in Papua New Guinea and Tui in New Zealand.4 As for companies that do already have a everyplaceabundant market component in a country and do not need to upgrade to barrack the globular operations, Heineken decide to go for joint ventures, where the two companies work unitedly, and limit the monetary risk of investment by working together with local dissipateds. as head as Heineken enjoys knowledge of the local market.\r\nFull acquisitions have a high degree of equity control. Also the preference growth is external. Full acquisitions are chosen if it is alpha to enter the market quickly, if the it is a fast maturement market, emerging markets? Also acquisitions are chosen if there are already companies existing of the same pro duct. received costs will be avoided by doing so. As for joint ventures, the degree of equity control is pitiful and has an internal resource growth. 5c) which of the cardinal multinational strategies draw in chapter 15 of the textbook intimately most resembles your firm;s multinational strategy? Please explain your answer.\r\n4 A) Consider the case of the central company deciding to set up a new production facility in an emerging market of your choice. Why is this an appealing emerging market?\r\nThe African market for Heineken is an appealing emerging market to expand in. This is due to a number of sympathys: nation growth on the African continent is pass judgment to grow from 1 billion as of straight off to 1.2 billion in 2020 and the African population is noneffervescent relatively young in comparison to other established markets such as Europe and trades union America. Besides this, the middle class in the African content is evolution steadily, consumers are beco ming more band-conscious and GDP per capita has been confident(p)ly growing since the last decades due to the upward(a) political and economical environment. Heineken is thus, presented with a number of advantages, in which the long term clearly outweighs the threats in establishing itself firmer in this emerging market.\r\nWhat are the threats that Heineken faces in go into the African continent as an emerging market more firmly? An impression that has encircled Africa end-to-end its history is the problem of corruption and bureaucracy. However, due to globalization and the increased interconnectivity around the globe this ethical wages has become a more prevalent content amongst societies to be discussed and the same goes for the African countries. Although the thin tranquillize exists MNO’s argue that there’s a slow but gradual decrease in the severity of it in the African countries in which the ameliorate political and economical environment is a positiv e contributor. other threat that Heineken faces in the African emerging markets is the lack of good infrastructure and power supplies. On top of this poor education, health care, life foreboding and poverty are some of the other threats that can have an effect on the MNO.\r\n4 B) How should your firm address the opportunities and threats of this emerging market?\r\nSome of the strategies Heineken as the multinational organization can undertake is by introducing unreleased brands into the continent. Some examples: are the introduction of the soaking apple cider beverage ‘Strong reconcile’ in South-Africa, non- inebriantic beverageic beverages such as ‘Amstel ZERO’ alcohol that taste like alcoholic beer and a large variety of other alcoholic beverages which alone drop curtain under the global Heineken brand of beers. Besides that, Heineken can gain TCM due to operational excellence, acquired throughout the years, and it can implement innovative and at the same sentence environmentally friendly PET bottles which they have lately introduced into the Democratic republic of Congo as example to underline their technological innovations.\r\nAs enjoyment per capita is growing in the African countries, whilst excluding the steady population growth amongst the African countries, an increase in demand for premium beer brands is emerging such as the ‘Heineken’ and ‘Amstel’ beers in the African continent in which the MNO Heineken is expected to face frightful growth opportunities in the following decades. These strategies have been introduced into the European continent and have proven to be real successful, with Africa as an emerging market Heineken can introduce the successfully proven strategies, which the company has used throughout the years to solidify its market station level off further.\r\nHeineken has a long history of in set up training- and development. It has already established regional training schools in Nigeria and the DRC wherein they have established strong management development programs to attract and retain local talents. This is a way for the company to combat the threat of poor education. Heineken tries to infract the life of its employees working for the company and as head the lives of people in the region: Heineken has established a healthcare program for all 30,000 of its employees where the government ofttimes lacks to adequately provide this. It has set up human immunodeficiency virus programs in sub-Saharan breweries to educate its personnel and also that founded African foundation programs such as wellness clinics and malaria projects to burst the lives of the people in its direct surrounding.\r\n5 A) line two strategic objectives (i.e., reasons) that your firm had for entering a specific foreign country. Please explain your answers.\r\nHeineken has tardily decided in 2013 that it will be planning on building a 60 trillion Euros Brewery in Burma (M yanmar). The Heineken group has decided to do so after it has seen positive progress in terms of political and societal reforms in Burma. On the 22nd of April this year all sanctions against Burma were lifted by the EU council and on top of this other large MNE such as Coca Cola, Pepsi and Carlsberg have recently decided to move into the country as well. Another reason for entering the Burmese market is that beer consumption in Burma is still at a relatively low level: 3 litres a year per capita whereas its neighbour Vietnam is at a staggering 30 litres+ a year per capita. This gives out a sign up that there are a lot of potentiality profits still to be make particularly now that political and social reforms are fetching place. By investing with a 60 million Euros brewery, Heineken plans on solidifying it’s market position even further crosswise the globe.\r\n5 B) Which foreign entry modes has your firm used in the last 6 to 8 years, and which mode was used for which cou ntry?\r\nHeineken operates in over 71 countries.6 The most common used entry modes that the firm uses consist out of joint ventures and acquisitions. In case acquisition of a foreign company is not a speculation due to government restrictions, Heineken will decide to try and operate as a joint venture. Heineken aims on dominating the global market and is constantly quest to acquire a larger market share for beer. For this goal, the company tries to enter foreign markets by using Greenfield acquisitions so that they have full control over their operations without having to add new capacity to the industry. This entry mode on top of not adding extra extra capacity to the industry as well comes with a faster entry speed and is most commonly used for emerging markets, where competition and growth in the markets is high. In this case, acquisitions are operated in emerging markets such as Asia and Africa. For example, the acquisition of the beer brand tiger between Heineken and APB and APIPL enabled the brand to lift with the growth of Heineken. conventional local premium brands including Biere Larue in Vietnam, Bintang in Indonesia, SP in Papua New Guinea and Tui in New Zealand share similar stories.7 As for companies that have already acquired a dominant market share in their hearthstone country, Heineken opts for joint ventures if they are unwilling to sell, where the two companies so work together instead, and thus limit the financial risk of investment by working together with local firms.\r\n5 C) which of the four multinational strategies set forth in chapter 15 of the textbook most intimately resembles your firm’s multinational strategy?\r\nFrom the four multinational strategies described in International avocation book Heineken organizational structure most near resembles a transnational strategy. This is because Heineken, being the third largest beer brewer in the world, has practically managed to penetrate itself in all markets in which it sells over 200 international premium, regional, local and specialty beers and cider. This vast variety of different brands has made the Heineken group highly responsive to consumers in which all their needs can be satisfied due to such a broad assortment. Due to Heineken’s high aggregation of benefits such as economies of measure and operational excellence the MNE captures the best of two worlds by being cost efficient and topically responsive, enactment the structure of a transnational strategy.\r\n6 A) Identify two ethical dilemmas that the focal firm faces in a host country of your choice. Why are these issues ‘dilemmas’ and how has your firm dealt with them?\r\nAn environmental issue that brewers portion out with is the controvert media of the use of alcohol. Consuming excessive alcohol has some negative health and behavioral risks. For this reason, umpteen governmental laws and regulations charges alcoholic beverages. As a social issue for the company, more than 800,000 car accidents in Mexico occur due to the use of alcohol. Even though these issues impact the social side of sustainability, the health and well being of people. This is an issue to the firm, because they are accused as contributors of the slanders as consequences of alcohol causing the firm to suffer from brand damage. Heineken essential defend its image as a brewery, especially since the firm is leader of the industry. To avoid shifting the commit on breweries, due to the fact that they have no lure on controlling consumers‘ behavior, they aim on increasing awareness of the consequences of excessive consumption of alcohol. Heineken supports the musical theme of no physically or behavioral harm when moderately consuming alcohol. Heineken aims on contributing to the positive role of beer in society by advance responsible attitudes towards alcohol and discouraging the misuse of alcohol. The most important stakeholders in these social dilemmas are the con sumers.\r\n6b) draft copy on stakeholder theory, argue to what extent the focal firm should develop a globally standardized strategy to cope with the selected dilemma. The excessive use of alcohol occurs is a global issue. The use of alcohol and driving does not only occur in Mexico, but causes many accidents and fatalities all over the world. Thus the issues discussed are of global relevance. The harm that this issue emphasizes applies to the users of alcohol and their environment. That is why Heineken launched an savor Heineken responsibly (EHR) Campaign in 2004, which is globally used. Measures that the firm has been interpreted include putting this message on all of their cans, bottles and packages. Also, in commercials and on their website they quote: ‘ capital opportunities belong to moderate drinkers’ to progress moderately drinking.\r\nmoreover, they advertizing boarding on all major sponsorships or sports. Furthermore, the company also tailored its strategy locally in Mexico, where they launched a Designated Driver Program to encourage attendees of to become or choose a designated device driver for different occasions. The program is presented in 92 universities across the country and other youth organizations and events. By doing so, Heineken hopes to decrease the probability of accidents caused due to alcohol. To conclude, Heineken already has a global strategy and a local strategy to cope with the issues. The social issue in Mexico is actually a global issue, since it occurs in many other countries. The reason why Heineken focuses on Mexico is due to the explosive high rates of alcohol fatality in merchandise in this country. We support the idea to expand the measurements taken for Mexico to other countries with high fatality rates, for instance in the United States where 31 percent of all accidents include fatality due to alcohol use in traffic in 2009.8\r\n6c) How do the actual solutions to the focal dilemmas relate to the soluti ons practiced by Unilever and which approach is infract? Sustainability living is the core of Unilever’s operations. It aims on doubling the size of their business and simultaneously reducing their environmental footprint and increasing the positive social impact. As for reducing its impact on the environment through its supply chain, it aims to maximize their Reduce, Recycle and Replace journey. cerebrate from their research, 68 percent of their total GHG footprint is founded by the consumer self. 26% of the footprint is due to the raw materials. To bring in this, the company came up with improving eco-efficient production and improving the agriculture practices. The related dilemmas that occur between Heineken and Unilever is to influence consumers behavior. Both companies cope with the fact that they cannot control the consumer use.\r\nFurthermore both companies try to communicate their issues through brand name. Unilever copes with this issue by adapting the sustainabi lity plan. As for Heineken, they launched the Enjoy Heineken Responsibly campaign, as mentioned before. What differs is that Unilever focuses on sustainability across the value chain, darn Heineken emphasizes the consumer use. From one point of view, the approach of Unilever is preferred over Heineken’s approach, because it tackles the entire value chain. Also, it works on the long-term solution. From another point of view it is gauzy that Heineken works on valuing life on a social and physical level, by reducing the hap of harming social and health. However this does not add value to future generations, thus we believe that Unilever has a better approach to tackle its issues.\r\nhttp://www.heinekeninternational.com/products_brands_brands.aspx http://www.centurycouncil.org/sites/default/ excites/materials/SODDFIA.pdf http://www.sustainabilityreport.heineken.com/impact/responsible-consumption/encouraging-responsible-consumption-through-our-brands.html\r\nhttp://www.heinekeni nternational.com/companystrategyprofile.aspx file://localhost/Users/raymondjansen/Documents/IB/annual%20report%20heineken%202012.pdf book, 373\r\n'