|
|
China Food and Drink Report Q1 2008Published by: Business Monitor International Published: Feb. 4, 2008 - 77 Pages Table of Contents
AbstractThe now ferocious battle for leadership of China’s dynamic and high-growth beer sector showed no signsof abating during the second half of 2007, with expansion by new market leader China Resources SnowBreweries (CR Snow) immediately followed by an investment from Tsingtao, and vice versa. In thisreport we assess the impact that this battle is having on sector growth, as well as the business strategies ofother expansionary multinational breweries in the country. We also look beyond China to the impact thatexperience of competition in the market is having on the strategy and ambitions of leading Chineseplayers elsewhere in the world.Key events from the last few months of 2007 include Tsingtao - which is 27%-owned by US giantAnheuser-Busch, its largest non-governmental shareholder - opening three new breweries and boostingits production capacity by some 20% in the process. The investment was part of a broader aim ofachieving sales growth of 20% annually to 2013, although following so closely on from CR Snow’s ownexpansionary investments, Tsingtao’s move can also be viewed as highly competitive. CR Snow, the localjoint venture of Anglo-South African major SABMiller and domestic major China ResourcesEnterprises, acquired stakes in four regional breweries across China just months before Tsingtao cameforward with its own expansion plans. In the province of Liaoning, CR Snow acquired 80% stakes in twobrewers to consolidate its existing leadership position in the region, while in Anhui the company alsofurthered its market leadership via an acquisition. Most notably, however, CR Snow took total ownershipof a brewery in Hunan province, marking its first foray into this high growth region. Both Tsingtao and CR Snow, along with their global competitors including InBev and Heineken, areseeking to capitalise on an industry which BMI predicts will grow by 30.6% in volume terms to 2012.Value sales growth is set to be higher still as foreign investors increasingly look to capitalise on highdemand at the premium end of the market; demand fuelled by China’s fast-emerging middle classes andan economy that is forecast to experience annual average growth of 9.4% to 2012. The neck-and-neckmarket leaders are not only interested in Chinese growth, however; they are also looking to build leadingglobal brands on the back of the establishment of a nationwide Chinese presence. Both have sought toabandon the traditional regionality of Chinese brewing to build national brands and both have provedsuccessful, but in largely different ways. CR Snow’s SNOW brand is now the world’s second-highestselling beer, yet this is based on the sheer size of the Chinese market alone. Meanwhile Tsingtao hasproved less successful at penetrating the whole of China and yet has become synonymous with the notionof Chinese beer globally and thus accounts for 50% of total beer exports from China. Throughout 2008 it will be fascinating to see how both firms chose to prioritise their domestic and globalaspirations, but with just one percentage point of market share between them domestically it seemscertain that neither brewer will be taking its eyes off China for the time-being." Get Full Details About This Report >> |
|
|||
|
About MarketResearch.com
|
||||