Abl Case Study Essay

Words: 2773
Pages: 12

Extended Case Study
Australian Beverages Ltd (ABL)

1. What type of organisation is ABL?
ABL was established by a group of enterprising pharmacists who made carbonated soft drinks in their pharmacies. ABL was listing on the Australian Stock Exchange (AXS) on 1996.The current managing director of the company is Tom Dwyer, who has been with the company since 2008. 2. Identify the industry, product segments and value chain.

The industry is the Australian non-alcoholic beverages industry. In this case study, it is focused on the Australian bottled water manufacturing industry.

Product segments :- Carbonated soft drinks (CSD), bottled water, milk drinks, fruit drinks, sport drinks, ready to drink tea/coffee, energy drinks.
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The suppliers have the ability to raise the prices. However, the cost of create bottled water is relatively inexpensive.

Power of suppliers’ suppliers : Not applicable.

Power of buyers is medium to high.
-Supermarkets and grocery wholesalers are the main distribution channels which the share of revenue for the year 2011 is $519m (35%). In this regard, they will have bargaining power when dealing with the manufacturers.

- Sales in convenience store have been an important distribution channel which helps to achieve brand recognition.

-Facilitated by improved information systems, wholesale’s experiencing decrease in power as retailers have been increasingly buying direct from the manufacturer

- In hospital arena, manufacturers have to secure their sales by tender agreement

Power of buyers’ buyers high:
Individual customers have strong purchase power due to variety of product choice available in the market and low switching cost

Power of substitutes is low to medium.
-It is easy for customers to switch from the bottled water to a substitute as long as is non-alcoholic beverages. However, water has successfully developed an image of being healthier than other drinks and this has driven growth in the industry. These trends are expected to continue in the future and bottled water will continue to increase its share of the non-alcoholic