Big Lion Small Cage
BIG LION, SMALL CAGE
South African Breweries dominates its home market, because the firm is capable of meeting the market’s abnormal demand. Several foreign companies have tried to enter the market, but failed because of SAB’s low-price strategy.
It has increased productivity by cutting 7.000 jobs in the past ten years and by hard negotiations with the inflexible trade unions. Despite rough roads and bad electricity supply, SAB’s distribution net is highly developed …
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…by volume, it hasn’t yet succeed in turning into a global player with global brands. SAB tried to enter the „first-world-beer-market“ by acquiring a British brewing group but failed at the price. Because buying a brewery involves many bidders, brands, already established in the market, can offer a higher price, for the chance to swallow a competitor.
One opportunity to enter the global market is sill left over: to be a takeover target itself.
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