Heineken’s dilemma

For more than a year now, Heineken Italia has been looking for a buyer for its Pedavena brewery. But in vain. Birreria Pedavena, which was founded in 1897 near the foothills of the Dolomite Alps, has been part of Heineken’s Italian group of breweries since 1974. Until last year, Heineken used to brew its speciality beers at Pedavena. However, in order to cut costs, Heineken decided to close down the brewery at the end of 2004. Unfortunately, finding the right buyer has proven difficult as Heineken did not want to sell the plant to a competitor – potential or otherwise. So far, three brewers have been named as interested parties: Italian brewers Castello and Tarricone, both privately owned, and the Swedish brewer Kopparberg.

Perverse logics

During the first half of 2005 German beer sales in volume grew 0.3 percent. However, when it comes to money – well, in value terms the market declined 2.5 percent over the same period in 2004. As the chart shows, it was not only the beer sales in the discount segment that grew, the discount chains themselves increased their share of total beer sales to 18 percent. The other multiple retailers retaliated in kind by revving up their beer promotions so that the share of beer sales through promotions rose to 17 percent – the highest in recent years.

How to get ahead in advertising

To those budding Coppolas and Scorseses, the König Ludwig Schloßbrauerei Kaltenberg, owned by His Royal Highness Prince Luitpold of Bavaria, will award a prize for the best beer commercial produced by film students. The award, the König Ludwig Trophy, will be presented to the winner on the occasion of the Munich International Film School Festival to be held in November this year. The König Ludwig Schloßbrauerei Kaltenberg has been a generous sponsor of the festival for many years.

The Kozel position

The rollout of SABMiller’s Kozel 11 Medium started this June. Beginning with the on-trade, the new beer has targeted regions where Drinks Union and the above breweries are strong.

One degree better than the rest

In 2002, however, Drinks Union brought back the degree. Drinks Union, a group of regional breweries, made a concerted push onto the national supermarket shelves with a “one degree better” media campaign.

Put it up to Eleven

The Czech beer market has started looking like Spinal Tap, the 1984 mock “rockumentary” about an aging heavy metal band on the verge of spontaneous combustion, writes Lyle Frink from Prague. In the movie, the rock star Nigel points out that the settings on the amplifier could extend beyond the standard 10 mark. Nigel: “Most blokes will be playing at 10. You’re on 10, all the way up, all the way up ... Where can you go from there? Nowhere. What we do is, if we need that extra push over the cliff ... Eleven. One louder.”

More job cuts

Soon they will have to put out the “office space for rent” signs. If InBev is going to push ahead with further restructuring programmes at its glitzy and spanking new Leuven headquarters, they might have to start looking around for new tenants. Having already outsourced the IT department, InBev announced in October that an “effectiveness study” of structures and processes in its global headquarters recommends further job reductions. In best management speak, “the proposed organization aims to create clear responsibilities and to eliminate overlapping or duplicated processes and activities across functions, as well as across Zones and GHQ, taking into account the right match of employee profiles with the new organizational requirements..

Who’s afraid of the WHO?

German brewers have at last woken up to the fact that the World Health Organisation’s plan to reduce the worldwide consumption of alcohol by 20 percent over the next ten years might also pose a threat to their business. Although many of them must have been aware that dark clouds were gathering over their heads, attempts to reduce alcohol abuse so far have been scarce and few in between – at least if compared with what brewers in other countries have done so far. ...

More Faliraki than Florence

It’s a time for Menetekels, Armageddons and other disasters of Biblical proportions. With the change in licensing laws only weeks away – they will change on 24 November – concerned citizens, pressure groups and even the police have voiced their objections to the new pub law with alarmist headlines. According to an internal Scotland Yard report, violent crime including murder and rape will soar when the government’s liberalised drinking laws come into effect. A representative of Alcohol Concern, an anti-alcohol lobbying group, reportedly said that extended drinking hours were more likely to turn town centres into “Faliraki than Florence”. By all accounts, British tourists seem to be interested in two things only: getting drunk and getting laid. Not necessarily in that order, though. ....

Of bulls, bears and golden calves

It’s become a hotly debated issue. How do you read a balance sheet these days? From top to bottom or from the bottom to the top? Delegates at the 4th World Beer & Drinks Forum, which was held in Munich in September, were treated to a piece of new times thinking by John Brock, the CEO of InBev, who told them that “(beer) volumes were broadly irrelevant” today. Instead it was EBITDA, EBITDA, EBITDA – and a bottom to top reading of InBev’s balance sheet. Wolfgang Salewski, the chief of Germany’s Brau Holding International (the JV between Heineken and Germany’s real estate and hotels entrepreneur Stefan Schörghuber in which Heineken has a 49.9 percent stake) was visibly outraged by this and retorted that if you do a proper job, the bottom line would somehow fall into place. ....