Heinekens Global Reach

Heineken’s Global Reach

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Question 1

Market Analysis – Competitive Position

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Question 2

Advantages of exporting • No Asymmetric Information • No establishing new subsidiary • Avoiding Host Country’s laws & regulation of producing the good • Probably tax benefits • Keeping the status as a unique imported good 3

Question 2

Disadvantages of exporting

• “Ramping Up” : - Allocate personnel for travel - Organization and Supervision of travel - Modifying product and package for travel • Longer business cycle • Expenditure of work • Export licenses

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Question 3

International Licensing Agreements • Method to expand international activities • Europe – France, Spain, Italy, Ireland and Greece – Started with export, because of highly competitive European market – 1980’s using of market knowledge to expand with licensing agreements

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Question 3

International Licensing Agreements • Africa – Bought sole brewery of Egypt – Ensured access to new market – 1.3 billion Muslims – Constraint: Islam forbids the consumption of alcohol • Avoiding risk: brewing non-alcoholic risk 6