British American Tobacco (BAT)
British American Tobacco is a global tobacco group, with brands sold in more than 200 markets. Dunhill, Kent, Pall Mall and Lucky Strike are its four largest selling brands. Some of their brands are Kool, Benson & Hedges and Rothman. It is one of the leading tobacco group, informally known as BAT. The British American Tobacco is the world’s second largest tobacco company next to Philip Morris International in terms of sales. BAT hold strong market positions in each of four regions including America, Asia-Pacific, Eastern Europe, Africa and Middle East; and Western Europe. They are the leaders in more than 60 markets. The company plays an important role in local communities around the world. They employ more than 57,000 people and in fact, they achieved to become a top employer and the company of choice for people in many countries and all areas of the business. Their main product are cigarettes, in addition, they also make or supply cigarillos, pipe tobacco and the roll-your-own. British American Tobacco Company already established a 46 cigarette factories in 41 countries. Linkedin 2015, BAT
They manufacture cigarettes chosen by one in eight of one billion adult smokers around the world. Since tobacco is their industry and main business, there are lots of controversial attached in their name and which relating arguments and disagreements so they take impacts and the business very seriously by acting responsibly and by doing the right things and it shows by the recognition and awards they received over decade. BAT don’t own tobacco farms, however, they provide agronomy support to over 100,000 farmers around the world. In 2002, they are the first tobacco company to be included in the Dow Jones Sustainability Index.
Choice of Country
I. New Zealand
British Tobacco Company have operations in around 180 countries and a market leading position in over 50 countries. One of the countries that BAT has expanded into is New Zealand. BATNZ is the leading tobacco company in New Zealand, it is a wholly-owned subsidiary of BAT Australasia, with a market share of almost 72 percent of the New Zealand Market. BAT imports, distributes and sells tobacco products in New Zealand like roll-your-own tobacco and cigarettes. It’s under range of brand names including Dunhill. Kent, Rothmans, Lucky Strike, Holiday, Winfield, Freedom, Pall Mall, Park Royal, Park Drive and Benson & Hedges. One of the reasons I think why they choose New Zealand is because New Zealand is a developed country and they know that they will easily capture the market because of no strong competition. Another reason, for me, is that since, New Zealand have many operations related to casino and gambling, tobaccos product will be more popular, because casino business is related to addictions, problem gambling and with smoking. We all know that the tobacco industry is very controversial so it’s very prone to issues and other factors. There are many factors that BATNZ is facing such as in the political, economic, socio-cultural, environmental and legal factors.
In terms of economic factors, tobacco industry is a big multimillionaire company with big operations and so it greatly contributes a big percentage in the economy. One factor is the employment, since the company have big operations, employment rate is also high. Since it’s a tobacco industry, it creates more employment per hectare of cultivated land compared to any other crops in the world. In New Zealand, there are approximately 100 permanent staff which are employed in headquarters in Auckland and regional offices in every part of the country. It also helps the economy through businesses, whether small or big or retail shops, about 7,600 NZ retailers revenue comes from tobacco. It can contribute up to 40 percent of their sales revenue. In terms of market share, given that it changes from time to time in each market, it has almost 45 percent market share in