Going Global & Managing Global Businesses Case Study

Inbev’s Growth Strategy in China: Targeting Clustered Territories

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Abstract:
Global brewer InBev's acquisition of China's Fujian Sedrin had been a part of its strategy to establish itself in the fragmented beer market of China. China's position as the world's largest beer market in terms of volume and growth justified InBev's decision. Moreover, InBev's alliances in south-east China since the late 1990s made the US$750 million acquisition vital and completed InBev's network in south-eastern China. However, InBev's foregoing of the north Chinese market triggered debates and their strategy to target the clustered territories did seem to be a farsighted one. The case aims to discuss the rationale on the part of InBev from two main perspectives: the enormous potential of the Chinese beer market and the high degree of fragmentation in the market. The

Pedagogical Objectives:

• To potential of the Chinese beer market and its appetite for competition
• To reasons that made InBev target the clustered territories in China
• To synergies of the acquisition of Fujian Sedrin
• To whether InBev would be able to establish itself as a national player overcoming the hurdles.

Keywords : Beer market; Clustered territories; Alcoholic beverage industry; Local breweries; Fragmented beer market; Global partner; Strategic alliances; China, developing market; Acquisition; Fujian Sedrin; InBev, growth strategy; Zhejiang, Guangdong, Hunei, Hunan; Operational synergy; Developing economy; Premium brands