Europe is a major player in the world beer market. In recent years, however, the sector has seen a decline in consumption in Europe due to several factors. Breweries are now facing losses due to decline of business. The giant Carlsberg plans to close 29 European breweries in the next ten years. The brewers are forced to adapt and restructure in order to survive the slump.
In addition to the political and economic factors that influence the sale of beer, there is an aspect of innovation that needs to be taken into consideration. Flavored beers have been introduced by brewers in order to attract a youthful clientele including women.
[...] The group intends to stand out in this field by developing sophisticated machines for household use, as beer consumption at home accounts for 70% of the market. Conclusion It is clear that the beer market is experiencing a difficult period. Given the impressive selection of alcoholic beverages, each more attractive than the others, there is a tendency to live down the old-fashioned image of beer. In addition, the regulatory environment is causing people to drink less. In spite of the challenges it faces, beer is far from extinction. [...]
[...] Several countries are major producers of beer such as the Netherlands (Heineken beer), France (the Danone Group) and Germany. Although the market stagnated to a certain extent in 1996, the manufacturers still have room to innovate. These companies will increase market segmentation, thereby offering the consumers products that best suit their needs, while also paving the way for products suitable for women. However the beer market has been declining for the last 25 years owing to the competition posed by Wines and Spirits. [...]
[...] Beer is primarily a summer drink, and all the changes in flavor are made keeping in mind this basic quality. In addition to competition between the brewers, there is also considerable competition from other alcoholic products. Customers are increasingly choosing other forms of alcohol such as wine, over beer. Belgium and Germany, however still prefer beer and consumption in these countries is on the rise. Strategic Choice Causes of restructuring Europe is a major player in the consumption and production of beer throughout the world. [...]
[...] Also beer has lost a considerable clientele on the basis of health reasons. Whereas wine is supposed to have a positive impact o health, beer has the reputation of causing. Health conscious consumers chose to opt for foods and beverages that have a positive health impact. The governments are also propagating a healthy lifestyle to reduce the risk of cardiovascular disease or obesity in industrialized countries. Nevertheless, competition from wines and spirits or other kinds of alcohol is limited, because beer consumption is mostly linked with sporting event, whereas wines and spirits are more likely to be consumed during meals or celebrations. [...]
[...] However, the bargaining power of the suppliers is reduced by the market leaders, who have chosen to follow the model of vertical integration, thus integrating the whole value chain under their ownership Threat of potential entrants: The introduction of new entrants into the European market of beer depends not only on forecasts of market growth, but also the size of existing firms. At present half the market share is held by the three leaders, and forecasts of market growth are very low for a few years. [...]
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