Diago analysis Essay

Submitted By will627
Words: 1174
Pages: 5

A SWOT ANALYSIS OF DIAGEO

COMPANY OVERVIEW
Diageo is one of the world's leading premium drinks business with an outstanding collection of beverage alcohol brands across spirits, beer and wine. These brands include Johnnie Walker, Crown Royal, J&B, Windsor, Buchanan's and Bushmills whiskies, Smirnoff, Ciroc and Ketel One vodkas, Baileys, Captain Morgan, Jose Cuervo, Tanqueray and Guinness.
With trading business in approximately 180 markets, Diageo employs over 20,000 talented people around the world. With offices in 80 countries, Diageo also has manufacturing facilities across the globe including Great Britain, Ireland, United States, Canada, Spain, Italy, Africa, Latin America, Australia, India and the Caribbean. Diageo is at the forefront of industry efforts to promote responsible drinking.
The company is listed on both the London Stock Exchange (DGE) and the New York Stock Exchange (DEO).
The company recorded revenues of £13,232 million during the financial year ended June 2011(FY2011), compared to £12,958 million in FY2010. The operating profit of the company was £2,595 million during FY2011, compared to the operating profit of £2,574 million in FY2010. The net profit was £2,017 million in FY2011, compared to the net profit of £1,762 million in FY2010.
SWOT ANALYSIS
Diageo is still a relatively young company – it has only existed in current form since 1997- but brands and business have a rich heritage. The marketing, sales and distribution of brands are organized across five geographic regions: Diageo North America; Diageo Europe; Diageo Latin America& Caribbean; Diageo Africa; and Diageo Asia-Pacific.
Strengths
Weaknesses
Having many outstanding brands
Focusing on innovation
Opening the Chinese market
Short history
Lack of major red wine brand
Opportunities
Threats
Emphasizing corporate social responsibility (CSR)
The background of the global active trade
The negative impact of alcohol abuse
The ban of driving after drinking
Strengths
Having many outstanding brands
Looking at the DIAGEO family diagram, we found that this young company successfully managed many of the world first class wine brands, such as, Johnnie Walker, the world first Scotch whiskey, the world first Guinness stout, the world first liqueur Baileys, the world first vodka Smirnoff.
These top brands have a good reputation, and influence the philosophy of people around the world, such as, the spirit of John Walker, "Keep Walking". These world-class brands can rapidly increase the international reputation of DIAGEO and can enhance DIAGEO influence in the industry.
Focusing on innovation
DIAGEO knows that to keep the competitiveness, the company must be committed to innovation. The company has established a solid platform for innovation, with world-class talent and resources. These innovations are based on in-depth market research and consumer drinking habits. Diageo also opens TRC(Technical Research Centre) in many regions. These TRCs are focusing on wine development, packaging and technology process as well as running first-class research and development program.
Innovation is an important strategy of DIAGEO. It has been a strong guarantee of the company's continued growth.
Opening Chinese market
China is a promising market, with a large consumer base and a deep wine culture. DIAGEO positively opens the Chinese market. In 2002, DIAGEO Great China headquarters was established in Shanghai, China. Then, DIAGEO successfully purchased 49 percent stake of Sichuan Chengdu Quanxing Group Co., Ltd. DIAGEO has a considerable reputation in China.
Weaknesses
Short history
Diageo is a really young company - It was only established in 1997. The short history means a small reputation. In spite of the fact that DIAGEO has many well-known brands of wine, many people only know the brand of wine and don’t know that they are belong to DIAGEO.
Business of DIAGEO develops fast, but its advertisement still needs to be strengthened. In…