Study and Analysis of a Multinational Enterprise Heineken

Table of Content


A transnational endeavor ( MNE ) besides called multinational company is concern entities that operate in more than one state. ( wiseGeek, 2010 ) Multinational endeavor usually has central offices in one state, known as place state, while other installations are based in locations in other states, known as host state.

Heineken is decidedly a transnational endeavor. The company carries out production and distribution activities in states other than its place state. In footings of direction orientation and scheme, the Heineken Corporation does a batch of things that show it is the nature of multinational. First of wholly, the corporation alters its operations to run into local demands. The company markets on a state by state footing. In add-on, the Heineken Corporation has professional spouses who help to run the operation and do non describe straight to the company on twenty-four hours to twenty-four hours affairs. Furthermore, the company relies to a great extent on teamwork by all involved parties.

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2.0 Company Background

Heineken is the 2nd largest brewery group in the universe and is dedicated to staying independent and strong. Heineken is available in about all state on the Earth and is the universe ‘s most valuable planetary premium beer trade name. Heineken has relied on keeping a assorted trade name portfolio, which included more than 120 trade names to keep a stalls of international, regional, local and forte beer trade names around the Earth. Their celebrated trade names include Amstel, Europe ‘s third-largest merchandising beer, Ochota, Tiger, Star, Birra Moretti, Zywiec, Murphy ‘s and Cruzcampo.

Heineken N.V headquartered is located at Netherlands. Netherlands is among the top 5 beer beer makers globally and the largest in Europe. Heineken trade names are good set up in profitable and mature markets, while the repute of the beers is lifting daily in energetic beer markets such as Russia, China, and Latin America and etc. At the terminal twelvemonth of 2007, Heineken has the widest being of all international beer makers in more than 65 states in worldwide and have 50 0004 employees ( Heineken N.V. 2008 ) . Heineken and Amstel have been formed as nucleus. The company has do a determinations on each of its trade name regional, international and local incorporate selling scheme and packaging merchandise related invention ( Heineken, 2008 ) .

2.1 SWOT Analysis

2.1.1 Strengths

Heineken is the 2nd largest beer maker in the universe. They manufacture 5.6 billion litres of beer every twelvemonth. This gives them economic systems of graduated table and a platform for farther enlargement of their market capitalisation.

The relish of Heineken beer is typical. In 1886, the barm that is used in the production of Heineken beer boulder clay today was developed. Therefore, the relish and peculiarity of it has been at that place for a hundred old ages.

Heineken trade name is perceived as premium trade name and has established a trade name image successfully in some market place like USA and Hong Kong.

The trade name was acknowledged as a superior quality or lighter beer expressed in attractive packaging across all markets.

2.1.2 Failings

The corporation has restricted its range to the European and the Western states. There still lies a range for scaling up in states like India where the beer is merely imported and therefore doing it impossible to come in deep down.

In some state, trade name image of Heineken was excessively marrow and this makes the trade name seen like appropriate for particular occasions merely.

Difference in trade name image across planetary market make the consumers confuse about sellers ‘ features, the merchandises ‘ properties, benefits, and etc.

The local Heineken trade name directors had the financess to develop their commercials which were non ever consistent to the Heineken trade name image that the directors of central offices wanted to project.

2.2.3 Opportunities

Population in Russia and Asia increasing dramatically make Heineken have opportunity to gain great market portion.

Latino consumers in U.S. industry are turning quickly

Introduction of low Calories beer as the society is forcing for a ‘healthy ‘ beer.

2.1.4 Menaces

Amalgamations and acquisitions of other breweries cause them to go much larger than Heineken ‘s brewery.

Trouble in maintain market portion when rivals increasing market portion.

Addition in minor imbibing and bibulous drive Torahs.

Plague Analysis

Plague analysis has been used by Heineken to analyse external environment of their concern. With simple analysis consist of considerate the corporation political, economic, societal and technological, house can take it indicant when they be aftering for an investing or concern expand.


Government policies

For many states, Heineken is foreign company, but they have to obey the authorities policies where they run their concern activities. For illustration, when they invest in Malaysia, Malaysia authorities will back up them because Malaysia authorities has welcomed investing by western investor with provides many inducements for those companies runing in Malaysia.

Political stableness

Political stableness will make chance for Heineken to spread out their concern worldwide because it is leader in the beer industry in universe broad. Thus this is besides an of import political factor. For political stableness companies, represents an attractive enlargement chance. This will assist to increase net income of Heineken every bit good.



Income is an of import economical factor for Heineken. This factor decides which category Heineken is traveling to aim. In the early clip of Heineken, they concentrating on the upper category but they introduce some beer through with different trade name ‘s name to aim the center and the upper degree every bit good.

If there is economic growing in the state and per capital income is increasing due to an addition in GDP will make an chance for Heineken. Buying power of the people will increase and they can pass more on buying. There is a down autumn in the economic system of many states. Turning rising prices rate and unemployment rate has reduced the buying power of the clients.



Heineken put a difficult attempt in making research to understand client ‘s civilization and tendencies to bring forth a suited beer to aim clients. This creates an chance for them. There is ever altering of client demands such as altering of healthy life-style and increased in tendency of healthy merchandise. There is a bead in gross revenues for beer company late because many people aware of importance of healthy.

Beer industry might make a immense influence for the host societies in positive and negative side. Positive consequence includes developing friendly relationships by understanding every civilization and imposts through positive attitudes towards each other.


Pace of alteration:

Pace of alteration means rate of alteration. Technology is really of import for the success for every company. Heineken is utilizing modern engineering to bring forth beers to acquire the competitory advantage. High engineering can assist to bring forth high quality merchandises.

Research and Development:

Research and development is besides an of import factor I order to success in runing a company. Heineken is much focal point on research and development. Its market research is inefficiency. For illustration, Heineken can easy come ining the worldwide market due to understanding their civilization, demands and tendency through engineering information.


There is much legal jurisprudence in state or oversea states that affect houses runing. There is really of import to obey legal Torahs in order to run a concern. In Malaysia, legal alterations can impact beer industry in house ‘s cost ( case: when new system or processs is developed ) and demand.

Below are the different classs of Torahs:

Consumer Torahs are used to protect consumers against unjust patterns such as misleading.

Competition jurisprudence is used to protect little houses from strong-arming by larger houses and will non corrupt by other houses with monopoly power.

Health and safety legal ration is used to guaranting workplace is safe for practical utilizing with appropriate proviso of safety equipment.

Heineken Group is really cautious about the stairss it takes because of the political environment which might set down it in problem. Heineken has played smart in doing a societal networking web sites so that its purpose of selling is besides solved and it did n’t traverse the line of the jurisprudence as the Torahs are different for different provinces.


Environmental factors include the conditions and clime alteration. Heineken increases publicities during summer clip as the clime is by and large warm in state such as India.

4.0 Impact of globalisation

The impact of globalisation is merchandises become more standardised globally, which lead to a rise in the overall quality of alcoholic drinks available. Global distribution webs might be more efficient economically, concept chances for economic systems of graduated table in production and in selling. Furthermore, planetary merchandises can profit from the planetary division of labour, utilizing the comparative advantage possessed by some states to develop planetary selling runs, locate fabrication, get ingredients, and develop new merchandises. The formation of planetary webs enhances employment and diffuses technological progresss from more to less developed states, although in pattern control over much of the engineering tends to stay in the custodies of the planetary corporations. ( Room R. , Jernigan D. , 2000 )

Globalization can steer to an addition in international trade even though most alcoholic drinks are consumed in the state which they are produced, but this seldom benefits developing states. Global trade figures suggest that overpowering bulk of planetary trade in alcoholic drinks occurs among the developed states themselves, with really few centers or low income states ( e.g. Chile, Mexico ) interrupting into the ranks of the taking exporters. ( Jernigan D.H. , 2001 )

This degree of globalisation and attending besides lead to extraction of monopoly net incomes and monopoly pricing, every bit good as making much superior political and economic histrions within every national context. The fact that the company is besides major advertizers increases their visibleness at the national degree. Heineken ranks among 100 largest advertizers in planetary. Globalization besides leads to quick transportation of invention from one market to another. These inventions can be in the kingdom of production engineering, selling, public relation, merchandise design and distribution. The function of planetary intoxicant manufacturers as chief advertizers points to the critical disparity among globalized and other types of intoxicant. Global intoxicant is marketed, and this is the dominant characteristic of its planetary production web. ( Jernigan D.H. , 2000 ) Fabrication of alcoholic drinks, and particularly of beer, is delegated easy. In Malaysia, for illustration, a joint venture between Guinness and Heineken produces both beers under the supervising of a Heineken brew maestro.

Globalization of selling and production webs has permitted Heineken to raise planetary integrating of selling and production, every bit good as to distribute sophisticated engineerings for selling and bring forthing its merchandises rapidly around the universe. It has besides formed a little group of immense corporations who are capable to advance their points of position expeditiously in planetary forums, such as the World Health Organization and the World Trade Organization.

Another impact of globalisation is on branding and selling. Companies in brewery industry progressively compete with each other on a planetary graduated table. They find themselves holding to commune their merchandises to planetary audience. Heineken ‘s challenge is that being a planetary trade name it has to hold communicating scheme that maintain its consistence so as to guarantee that a message is conveyed yet it has to take into history the local civilization and step of different markets. The end and the challenge of communicating for Heineken will be to convey the nucleus values of the trade name and modify the message as to plead to its different markets, spiel into local tendencies and leveraging that information to bring forth a association with the audience so that they build an emotional tie with Heineken.

Political factors might hold direct or indirect factor on the public presentation of the corporation. Several declarations made by the federal authorities of the U.S. have influence negatively on the concern of Heineken. For case, legal suits brought against in 2001 and decided to cut down production and selling of high public presentation computing machines is considered a menace to U.S. national security. These have had tremendous impact to the corporation. Every corporation is affected by economic factors such as currency exchange rates, financial policy rates, consumers ‘ factors, involvement rate policy, etc. It is likely that the U.S. economic system ‘s clime dominates how the client behaves in the society. The assurance of the client will automatically change if the economic system is recessing, dining or retrieving.

In add-on, the manner Heineken has sold its merchandises was affected by the powers within the society such as friends, media and household. Majority of the clients have been given the incorrect feeling about merchandises made from America are high quality. This means that corporation such as Heineken have benefited a batch. Social factors affect client involvements, attitude, and sentiments on the manner they view merchandises from certain corporations. As engineering alterations, the manner Heineken operates its concern has changed. For case, the cyberspace has helped corporations such as Heineken to run into up new markets and widen its planetary outreach. It has had a profound influence on the selling mix schemes of legion companies. In this of all time altering universe, every concern supposed to maintain in touch with modernisation and altering engineering.

The globalisation of Heineken has negative effects to little breweries in states where it take to construct breweries. The minor companies are happening it difficult to vie with big transnational companies such as Heineken. Globalization besides pushed Heineken to alter their merchandises and trade names, which are their bequest to merchandises that will be accepted worldwide.

5.0 Schemes use to react to the impact of globalisation

As a planetary corporation, Heineken attempt to run more affiliate since the universe move into 21 century. The corporation ‘s sustainable development is the integrating of the new method of ‘green ‘ vision of all facets of its concern. Heineken place the function it should play and has paying attending on several countries:

5.1 Continuous development of its environmental impact

Amongst the ends the company has set is a lessening of indirect and direct C dioxide emanation in the industries by at least 40 per cent and ingestion of H2O by at least 25 per cent in 2020. In add-on, Heineken has besides developed enterprises to cut down the C footmark throughout the value concatenation. As an initial measure, all replacing iceboxs issued to clients would be based on ‘green ‘ engineering get downing from 2010. ( Sustainability Report 2009 )

5.2 Authorization of communities and people

The Heineken Company will convey in a series of enterprises. For case, the investing of an extra EUR 10 million ( sum of EUR 20 million ) during the Heineken Africa Foundation, leting up to EUR 1 million per twelvemonth to be squarely invested in local undertakings in 2010. Besides, they target to enlarge the local footing of natural stuffs within Africa to 60 per cent by 2020. In add-on, they set a end to do certain all dependants and employees have admittance to basic and liberate of charge health care. The others enterprises of Heineken Company are the preface and audit of new employee rights policy. ( Sustainability Report 2009 )

5.3 Continuing to make a positive impact on the function of beer in society

Heineken Company will reenforce its acknowledged, positive attack to responsible ingestion by increasing its programmes to on and off premiss. Furthermore, Heineken program to do certain that all markets have partnership that assist the company play its portion in plumping intoxicant maltreatment. Furthermore, the company will spread out its trade name related duty messaging and magnify its attempts working with the industry on this cardinal issue. ( Sustainability Report 2009 )

5.4 Supply concatenation duty

In footings of moralss and the environment, betterments in value concatenation are holding a positive result on their cost base every bit good as on the aims they set within sustainability docket. An established and of import attack inside Heineken is working together with providers to assist construct betterments in their value concatenation. They work together to turn to both ethical considerations and the environment. It is the cardinal component in set uping a joint committedness to sustainability with their providers. They believe their attack to provide concatenation duty aid in distinguish Heineken from its rivals. ( Sustainability Report 2009 )

5.5 Quality harvests at a just monetary value

Heineken brew beer with natural ingredients. They use the preponderantly barley, highest cereals, for brewing, and hops for spirit and resentment. They need to entree to high quality, equal natural stuffs at an acceptable monetary value. Their spouses, maltmans that malt the barley and the husbandmans that grow the harvests need to be convinced that Heineken pay out them at a just monetary value and back up them over the long term. Making a dedication towards superior local sourcing and supplying agricultural preparation and support, authorizes local husbandmans economically ( greater guaranteed gross revenues and better harvest output ) and diminish both the cost and environmental impact for Heineken. ( Sustainability Report 2009 )

5.6 Responsible ingestion

When it is abused or misused, society is normally confronted with the negative aspects of intoxicant. They are dedicated to playing their portion in dunking alcohol-related injury. Wherever they can, they do so in happenstance with NGOs, constabulary forces, industry groups, retail merchants, authoritiess, Horeca proprietors, 3rd parties, legislators and community groups – every one of which have their function to play. They believe that working together to cover with specific facets and happening of maltreatment is the lone method to efficaciously decide the negative impact that has on persons and society. ( Sustainability Report 2009 )

6.0 Decision

Heineiken merchandises are selling worldwide. However they still have a infinite to spread out their concern. Most of the consumers are concerns about green environment. Heineken can come out with new gustatory sensation of beer with environmental friendly packaging to aim clients and contribute to environmental protection duties. In add-on, scientific discipline and engineering is more advanced comparison with last clip. Heineken can utilize engineering tendency to come out with good selling communicating to aim consumers and settle the negative force of jobs in their concern. With first-class concern direction, Heineken can make more good cognize trade name name internationally and gaining more net income for its company.

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