Carlsberg Polska Company Profile - Case Study Example

Carlsberg Polska Company Profile Carlsberg Polska is a company that operates as a subsidiary of the larger Carlsberg international brand. Formerly Okoicim Group including all the holdings of Okoicim brewery formerly owned the brand that markets under the Carlsberg brand. Okoicim was founded in the year 1845 by Johann Gotz (Mieczyslaw 3). Carlsberg acquired a stake in the company in 1997band then consolidated its stake in the 2001 by further increasing its shares in Okocim. Total takeover was eminent and in the year 2004, Carlsberg finally managed a 100% stake takeover of Okoicim Group including the Okoicim brewery. Currently, Carlsberg Poland is the third largest brewery company in Poland with an impressive market share of 15%. The company has created job opportunities for over 1300 employees and is looking for avenues to increase the market share and expand its business. Duties as the Head of Management in Marketing I am currently settling in on my new posting as the marketing manager for Carlsberg Okoicim, that is, the Polish subsidiary of the international Carlsberg. My core objectives and duties in the company include the developing marketing strategies and coming up with the right marketing mix to facilitate the company to maintain a larger market share. It is therefore imperative that I am able to proper implement solutions that are ahead of competition in terms of the right marketing mix through extensive research and study of the industry. My current job posting requires a versatile well-versed employee with good managerial skills and good at marketing and execution of strategies. The core objective of my job is to not only increase the market share in the short time, but also to lay down a framework that will increase brand visibility and recognition. The marketing team is also tasked with employing new strategies unique to the Polish culture and way of life in the quest to increase sales and maintain a competitive advantage over other brewing companies. Brewery Industry in Poland The beer industry in Poland is a very competitive industry with over 90 breweries and microbreweries competing for the same market share. Under the era of the Polish communism national reign, most industries were nationalized and free market trading was impeded, thereby stifling growth of the economy of Poland and the respective industries. After the fall of communism, free market economy emerged and the brewery industry has experienced tremendous growth through mergers and consolidations of local beer firms by international brands like Carlsberg. In 2009 Earnest and young compiled a report that showed that Poland is the third largest producers of beer in Europe. Only Germany and Britain out produce Poland. These are impressive prospects considering the size of the country. Currently, statistics show that the brewery industry is heavily dominated by three major companies, which control about 86% of the brewery industry. The brewery industry in Poland is very vibrant and is under a body called the Union of the Brewing Industry Employers in Poland (Związek Pracodawców Przemysłu Piwowarskiego) which controls almost 90% of all breweries in the country(Mieczyslaw 8) . Statistics released by this body show that beer consumption in Poland has been experiencing a steady growth and in 2008, the consumption per capita reached 94 liters per capita. This translates to over thirty five million hectoliters. The average consumption amount of the average Polish beer consumer is about 93 liters of beer every year. These statistics are relatively high and in terms of consumption of beer, Poland only trails the Czech Republic and Germany. Therefore the industry has been favored become one of the best employers with an, employee base of 210 000 people. It has also become the major tax contributor with an annually average tax of 3 billion remitted to the government in form of taxes. Most of the major breweries have undergone complete takeovers by larger international companies or are in mergers with the big international brands. SAB Millers, Carlsberg and Heineken are the top international companies that control the largest market. This was attained through a series of strategic takeovers and mergers of the existing breweries and microbreweries. Market Statistics As stated earlier, Carlsberg Okocim was formed with the acquisition of 100% of shares by Carlsberg. The company currently trades under the name Carlsberg Polska. Carlsberg Polska has a domestic c market share of 14 % and the prospects show the potential increase of this figures are in the likelihood. Carlsberg Polska’s produces five beer brands which are Carlsber, OK Beer, Piast, Ksiaz, Karmi and Harnan (Mieczyslaw 11). Carlsberg Polska also owns the Kaszetelan and Bosman breweries, which on their own a respectable brand of beers under their production line. These beer brands have been well received in the market and consumption is set to go up. For instance in 2003, the company made history in its OKocim brewery by producing two million hectoliters alone (Mieczyslaw 9-13). This attributed to marked increase in the market penetration of the company as well as the improved production process at the modernized Okocim brewery. The main competitors of the company are Kompania Biwowarsk, which has command of the market at 45% .the majority shareholder in this company, is the international company SAB Millers which has been vital in their large market share. The other key competitor is Grupa Żywiec S.A. that has a 35 %stake of the market. Heineken has a 61% stake on the company. Background Information about Poland a) Demography According to the last census that was conducted, the population of Poland stood at 40 million with about 40 5 0f this made up of ethnic Poles. Others ethnicities include German, Russians, Belarussins, Roma and other smaller minority groups. The main dialects in Poland are Great Polish, Kuyavian and Little Polish. These dialects are based on the geographical regions which form the ancestry and thereby the every region has its own dialects. Poland has a rich history, which forms the basis of most of their identity and national heritage. Polish identity is especially embedded in the Roman Catholic Church due to its past affiliations with it. This close ties with the Catholic Church were formed based on political animosity and affiliations of former enemies of the country. For many years, the Russian Orthodox and the increased persecution by Protestants from Germans oppressed Poles. The Catholic Church gave them a unifying platform and many Poles subscribe to Catholic teachings. b) Economy The economy of Poland has seen growth since the abolition of state controls on the economy under the Polish communist party. The advent of free market economy has spurred growth n almost all industries as well as attracting investors and multinationals to invest in the country. The shift from a state controlled economy to a free market has enabled the rapid increase in privatization, which has contributed immensely to creating employment opportunities to a majority of the population. Estimates show that over 70 % of the employed are currently under the private sector and contribute an impressive 67 %to the GDP of the country. Industries in Poland are thriving at an impressive rate and the major ones are steel works, shipbuilding, brewing, and processing of food and beverages as well as coal mining. Technology has played a key role in the growth of the various industries due to improved efficiency and accuracy thereby cutting the costs of production while increasing the rate of production. The brewery industry has been one of the core propagators of growth spurred but great investments by large foreign multinationals. Poland’s regional trade has seen a deliberate shift from the former trading partners affiliated with the former Soviet Union to more leanings towards new partners particularly members of the European Unions. c) Political and Social Aspects Poland is a class-based society whereby majority of the high class wield most of the power, in both business as well as the political scene. The country is also reeling from a bad political leadership under communism era whereby politics there was widespread discrimination and antagonism based on class and political affiliations. As much as the country has a close-knit society, the issue of class has always been seen to take a dormant dimension. Typically there are six strata of classes spurning from the peasants to the nomenclatura, who are the ruling strata. In between the extremes, there are the intelligentia, the workers as well as the szlachta. The political system has started gaining track recently due to years under the communism rule where different views and ideologies were not entertained. The government of Poland is the most powerful institution that is charged with the mandate of enacting and implementing laws. It follows the commonwealth system of governance where the president is the head of state with the division of the government into three arms; legislature, executive and judiciary. Culture a) Social Planning The paradigm shift of the country to move towards heavy industrialization has had a corresponding impact on the society. More women are becoming more independent and most are becoming keen on advancing their careers while putting marriage on hold. This is having an impact on the family structure and reproduction whereby few newborns are recorded each year. The society has also shifted its focus on the services they receive and are becoming more vocal. The close-knit society is also disappearing based on the migration of locals and new arrivals from other countries due to the opportunities available. The population is first becoming dependent on its older generations and this could be problematic in the future due to lack of people to sustain the achievements attained. b) Economic Planning The best economic planning strategies should be based on ideas that foster the growth and expansion of the economy and not merely basing it on the current social needs of the population. Growth of cities and large metropolis will entail the creation of zone specific economic activities that will be able to spur economic growth in their various districts and sub districts. This also calls for the mandatory cooperation between public and private sectors in the realization of such projects and increasing infrastructural facilities. c) Political Aspects in Regard to Cultural Planning As stated earlier, politics has become more of a preserve for the rich class who are mostly business people and moguls in their professions. The cultural gap is left void in politics due to the automatic exclusion of cultural based professions such as artists and writers. The rampant monetizing of every aspect of the Polish life will have a negative impact on the overall culture if the nation and subsequently the overall cultural panning that is needed to help speed the economic outlook and spur growth. Carlsberg Polska Strategy The core objective of Carlsberg Polska is to be the fastest growing company in Poland as well as increase the brewery market share by capitalizing on our competitive advantages. Forging ahead with the strategy, the company will execute three strategic moves that will facilitate faster growth, increased market penetration as well as attaining the framework of sticking to the cultural strategic planning, which is the core for the marketing department. The first approach will be to structure the portfolio of our products to enhance sales and revenue. The company will therefore seek to replace some of the slow moving local products with more in demand international brands. This strategy will be based on consumer survey and the changes that will be made will be solely dependent on customer survey. Market Expansion To increase our market segmentation, Carlsberg Polska will have, a new structured approach on distribution has to be developed. This will include increasing brand awareness as well through increased visibility of our products in retail outlets. This will also entail an increased attention to the marketing advertisements and paid commercials to increase the reach. New Market Strategy Apart from consolidating our existing market, Carlsberg will also seek to acquire new market through new branding and packaging techniques. This is geared towards attracting the local average Polish drinkers to enjoy more of the international brands as well as the local brands. Research shows that there are some consumers who exclusively enjoy local brands but completely ignore the international brands this is group is a potential new market for our international brands. Other strategies for Carlsberg Polska include the following: Strengthening Sales of Selected National Brands Strengthening the local brands Improving our services through further training of human resource Reducing cost of production and increasing efficiency Works Cited Mieczyslaw Bak .The Carlsberg Breweries A: A Case Study of Investment in Poland Copenhagen Business School. CBS. Center for East European Studies. CEES. Center for East European Studies. CEES 2005, 22 pages. Jens Gammelgaard, Christoph Dörrenbächer. The Global Brewery Industry New horizons in international business. Edward Elgar Publishing, 2013.Illustrated.352 pages. Matthias Reichhard. European spirit, adaption to market economy and national identity in Poland and Ukraine: National culture and its influence on the European Integration, advertising and entrepreneurship; Diplomarbeiten Agentur, 2008. 284 pages Read More