Essay on Global Forces and the European Brewing Industry

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The drive against drunken driving and binge drinking has helped shift sales from the 'on-trade' (beer consumed on the premises, as in pubs or restaurants) to the off -trade (retail). Worldwide, the off-trade increased from 63 per cent of volume in 2000 to 66 per cent in 2005. The off-trade is increasingly dominated by large supermarket chains such as Tesco or Carrefour, which often use cut-price offers on beer in order to lure people into their shops. More than one-fifth of beer volume is now sold through supermarkets. German retailers such as Aldi and Lidl have had considerable success with their own 'private-label' (rather than brewery-branded) beers. However, although on-trade volumes are falling in Europe, the sales values are rising, …show more content…
Smaller players in fast-growing Chinese and South American markets are being snapped up by the large international brewers too. Medium-sized Australian brewer Fosters is withdrawing from direct participation in many international markets, for example selling its European brand-rights to Scottish & Newcastle. Table 3 lists the world's top 10 brewing companies, which accounted for around half of world beer volumes. There remain many small specialist and regional
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sales in 2005 of €313m, it is less than a twentieth of the size of Heineken. Its key products include Grolsch premium lager and new flavoured beers (Grolsch lemon and Grolsch pink grapefruit). In The Netherlands Grolsch holds the rights for the sale and distribution of the valued US Miller brand. About half its sales are obtained overseas, either through export or licensing of production: the United Kingdom is its second largest market. In 2005, Grolsch centralised its own production on a single new Dutch brewery to increase efficiency and volume, and opened a small additional 'trial' brewery in order to support innovation.
Innovation and branding are core to the company's strategy. The company believes that its strong and distinctive beers can succeed in a market of increased homogenisation. Its brand is reinforced by its striking green bottles and its unique swing-tops.
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