Strategic Position For The Future Of Sabmiller Commerce Essay

Strategic Position For The early Of Sabmiller Commerce EssayIn the brewery industry, SABMiller, which has been operating across six continents, is at present one of the worlds leading brewers. Regarding of the business environment, the company has bring outed from a developing country, south Africa, and has successfully entered into deuce developed and developing grocerys through acquisitions and peg estimate. tally to the financial report for the last five years, the company has been doing quite healthy (SABMiller, 2012).For the strategic capabilities, the tautens resources and competences ar taken into account. Firstly, in 1950, the firmly was able to strike its headquarters from London to Johannesburg in order to expand its business in Southern Africa due to the restriction of trading between the country and the external businesses. Secondly, the firm is able to raise capital through its listing on the London stock exchange. Thirdly, the firm has entered into the glo bal market by getting some major brands such(prenominal) as Dreher from Hungary, Miller from USA and forming a join forcest venture in China. Then, the company also has made separate acquisitions, joint ventures and brewery investments in other countries in recent years. However, acquisition whitethorn not be applied for SABMiller any more than in the future because of fewer big transformational deals and lower prospects of high financial of re perverts. About the management structure of the firm, it practices decentralization as local managers understand deeper about the local businesses (Johnson, Whittington and Scholes, 2011).3.2 The fresh vision statement, mission statement and the strategic objectivesVisionThe best in the world in providing the most various choices for beer drinkersMission add increase portfoliosFind more business partnersProvide the most comfortable works environmentStrategic objectivesIncrease sugar to 15 % annuallyIncrease the sale of agio beersForm ing more joint ventures with local brandsUpgrade the in vogue(p) engineering in administration and manufacturing.As time goes by, SABMiller has been growing larger enormously through acquisitions and joint ventures, and it has almost earned much profit from these business deals. Therefore, a new vision statement for the firm is to be the best in the world in providing the most various choices for beer drinkers.In order to support the vision, SABMillers mission is to increase more merchandise portfolios for the consumers. The firm pull up stakes baring more business partners to grow bigger and bigger in the brewery industry. The firm allow provide the most comfortable working environment that employees testament be most satisfied and efficient by providing the most advanced- technological conditions.Those missions must be carried out in limited strategic objectives. First of all, the firms aim is to increase its profit by 15 % annually. Secondly, It necessitate to increase mo re types of beer, especially international premium beers to converge the rising demand in emerging markets. Thirdly, it also needs to find out more opportunities for growth with its animated harvest-home portfolios through joint ventures in local brands. Finally, the firm needs to upgrade the latest technology in administration as good as manufacturing, so the employees go away feel more convenient and put more effort in their work.3.3 Three alternative possible strategic pickings for SABMillerThe first strategic option recommended for the firm would be the product development, which deliver new products into the existing markets. In embody of Generic strategies, this strategy should focus on differentiation by building more premium types of beer. The reason is that the beer consumption is growing in these emerging markets, and the people here are earning more (Simon, 2012) therefore, they are voluntary to pay more for their drink as well. Another reason is that consumers p resent still prefer high quality beer during the economic crisis (Nadine and Simon, 2012). Although this strategy will fall into question marks in the Bostons BCG matrix as these premium beers are wholly new products, they are more likely to turn into stars as the market share is growing, and the consumers will pay more as well. harvesting development is also a strategy belongs to the Ansoff matrix, so SABMiller needs to add more new premium beers to its brand portfolios in the existing markets such as in China, Latin America and South Africa, which are also emerging markets.The second strategic option would be the market development, which the firm will penetrate into new markets with the existing products. Even though the target markets here are Africa and Asia, which SABMiller has already entered, it cannister real earn more brands from North America, Latin America and Europe to these countries due to the miss of its brand portfolios in these two regions. This is also a cos t-focus strategy, based on the Generic strategies, for the firm as the costs of labor and raw materials in African and Asian countries such as China and Vietnam are cheaper, so it is an advantage for the company to cut costs in manufacturing. In terms of the BCG matrix, this option also fall into a question mark as local brands from Europe, for instance, are new in Africa and Asia. However, there will be a high chance to become a star indoors a short time as consumption is rising up in these regions. marketplace development is another strategy belongs to the Ansoff matrix as the firms current products portfolios from North America, Latin America and Europe are totally new for consumers in African and Asian countries.The last option, which SABMiller is capable of doing and truly has succeeded before, is joint venture. Based on the case, the firm can consider entering into a joint venture with Dos Equis Brewer Fomento Economico Mexicano (FEMSA) from Mexico, or EFES Breweries tran snational from Turkey. According to Generic strategy, this can be known as a cost-focus strategy for SABMiller because these two brands are currently doing alright in sudden markets like Latin America, Africa and Asia therefore, SABMiller is able to have a good start as it is also operating businesses prosperously in these markets. In the BCG matrix, both SABMiller and these two brands are having high market share and growth in those emergent markets with their current product portfolios therefore, if joint venture takes place, there will be no doubt that SABMillers market share and growth will boost up continuously. In terms of Ansoff matrix, this strategic option actually help SABMiller increase its market share in its current markets, Latin America, Africa and Asia with the current and combined product portfolios of both the firm itself and it partners (Johnson, Whittington and Scholes, 2011).Lower costDifferentiationBroad targetCost leadershipDifferentiation cut target32Cost fo cus1Differentiation focus rivalrous advantageCompetitive scopeTable 1 Porters Generic strategiesMarket share spicyLowHigh3Stars21Question marksCash cowsDogsMarket growthLowTable 2 BCG matrixProducts / services aliveNewExisting3Market penetration1New products servicesNew2Market development confused diversificationMarketsTable 3 Ansoff matrixStrategic options1 Product development2 Market development3 Joint venture3.4 The most recommended strategic options for SABMillerOut of the above three strategic options, join venture would be a great move recommended for SABMiller. In fact, the firm has succeeded in forming joint ventures with others firm, so it clearly shows that the company is capable of doing such kind of thing. Furthermore, the two considerable firms for forming joint ventures, FEMSA and EFES, are doing quite well in Latin America, Africa and Asia, where SABMiller is also having a good taste with its business, so it will be an advantage for SABMiller as it can achieve more g rowth, reduce competitors in these markets. In addition, forming joint ventures also helps SABMiller to expand its product portfolios into other current markets. To sum up, forming a joint venture can be seen as a safer option as the current product portfolios are star products with high market share, while the other two option might be a little bit riskier as the products and the markets are new and unpredictable to measure successes.