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Heineken 1. What is the structure of the global beer industry? Perform an industry analysis using Porter’s Five Forces framework. Which of the competitive forces seem to have the greatest effect on industry attractiveness? Which of the competitive forces have the least effect on industry attractiveness?
Nonetheless, the consumption level of beer has been increasing along with its price (Colen & Swinnen, 2011). The diagram represented below exhibits the structure of the internationally expanded beer market as on 2005 along with highlighting the changes since 1961: Structure of the Global Beer Market Source: (Colen & Swinnen, 2011) From the above figure, the consumption level of beer in the global market can be observed and thus it can be stated that the profit ratio of beer industry is also rising with its demand and consumption in various global markets. It is worth mentioning in this regard that with the passing time, the degree of competition along with the threat of substitute products have increased considerably. In this context, wine can be regarded as a major substitute of beer in the global market (Colen & Swinnen, 2011). With reference to Porter’s Five Forces, the threat of substitute products in the global beer market can be regarded as other alcoholic drinks like wine and various other types of liquors. However, in recent phenomenon, the industry also needs to witness a strong influence from non-alcoholic substitute products such as soft drinks exhibiting a high degree of substitution threat. ...
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