Dmitry Nekrasov’s Philosophy — on the Past, Present and Future of Ukrainian Brewing IndustryA meeting with Dmitry Nekrasov always turns into a training course: “Introduction to brewing business“. We are talking to a clever “playing trainer“ a person that can be called a godfather of the Ukrainian craft. He has a dozen of successful projects to his name. Dmitry told us about craft beer in Ukraine, on market cycles, on specifity of operating in retail and HoReCa, on union of Ukrainian brewers and certainly, how a brewery of his own, First Dnipro Brewery is doing.
The market of import beer in Russia: review and databasesThe market of import beer is rapidly growing and changing. But while in the past years it was growing due to brands variety, in 2019 major and affordable brands from TOP-10 were developing actively. It seems that the fact of a brand origin from far abroad counties, even if it is not well known but has moderate price and good distribution provides for million liters of sales in the territory of Russia. Among distributors AB InBev Efes was far behind, yet the role of Baltika and suppliers of the second row got more important. The boom of German brands was followed by stagnation of import from other traditional regions (and Belarus) instead the supplies from Mexico, Lithuania and Asian countries grew considerably.
Russia: Positions of Brewing CompaniesThe review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.
Ukrainian beer market 2019: companies and brandsIn 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.
Brewing industry in Kazakhstan 2019During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.
The trend of complication of Russian beer market is going on and in several directions at the same time. The range has got wider, the import and small segments are growing, namely craft beer, alcohol-free beer and special flavor beer. At the same time, all ex-mega brands and light lagers by Russian brewers are experiencing a decline of their shares. AB InBev Efes, Heineken, MBC and Pivzavod Trekhsosenskiy have exceeded the market, Carlsberg was developing slower than the market and Ochakovo as well as some other mid-sized breweries have been cutting down their volumes. To a big extent brewers’ performance was connected to their ability to reach agreement with networks, sacrifice their margin and enter new markets. Craft brewers are facing a serious danger of producers’ registration introduction – de facto licensing. ...
Myanmar Beer adjusting to increasing competition on Myanmar beer market
These days there is more variety, thanks to the arrival of Denmark’s Carlsberg and its Dutch rival Heineken, which began brewing in Myanmar this year as economic reforms uncorked a market protected under military rule.
Now, Myanmar Brewery Limited (MBL), the military-linked producer of the old favorite Myanmar Beer and four other brands, faces stiff competition from global giants for a rapidly growing consumer market set to lift beer consumption from among Asia’s lowest.
Just months after opening, Heineken is doing so well it plans to double capacity at its Yangon facility to 50 million litres from 25 million litres, said Lester Tan, managing director at the APB Alliance Brewery Company which produces Heineken.
The company has accelerated an expansion plan it had expected to execute after three or four years, he said.
“Heineken volumes have just gone through the roof, it has taken us all by surprise,” Tan said.
Heineken’s economy brand Regal Seven is “slowly chipping away” at Myanmar Beer’s competitive advantage, he said.
Still, Myanmar Beer commands about two-thirds of the country’s beer market by volume. And the company has not sat complacently on its market dominance – like other state-backed firms, MBL has moved swiftly to overhaul both its image and products to appeal to Myanmar’s new consumers.
“There are a lot of the challenges in the market,” said Hiroshi Fujikawa, who became MBL managing director this year after Japan’s Kirin purchased a 55 percent stake for $560 million from Singaporean firm Fraser and Neave (F&N).
“One is that Heineken and Carlsberg came into this market this year and launched premium and local beer products. So the competitive situation in the market will definitely be changing and be more and more fierce.”
While Heineken and Carlsberg were building their breweries, MBL rolled out a sleeker bottle, ramped up its promotional efforts and began targeting a younger generation by sponsoring hip-hop and electronic dance music concerts, a work around to the country’s strict ban on alcohol advertisements.
The history of investment of foreign brewers in MBL – even during sanctions – has helped keep it in contention. Kirin’s purchase came following a dispute between F&N and Myanma Economic Holdings Limited (MEHL), a military-backed conglomerate that holds a 45 percent stake in the brewery. F&N had been involved in the firm since the mid-90s.
As in other industries in Myanmar’s emerging economy, one of the biggest challenges to growth for the brewers is finding skilled workers.
“If I take a look at the individuals, the workers here, there is a lot of potential to be improved,” Fujikawa said of MBL and MEHL. Kirin has started taking staff to Japan for training, he added.
MEHL is one of the country’s two major military-backed conglomerates with sprawling interests in industries ranging from gem production to supermarkets. Its profits help fund pensions and welfare for members of the armed forces and their families.
MEHL is targeted by U.S. sanctions, which prohibit U.S. businesses from working with the group.
Japan’s firms have not been subject to similar restrictions, but Fujikawa said that he was aware there was reputational risk for Kirin in working with the group.
MBL posted a net income of $51 million on sales of $201 million in 2014.
Research firm Euromonitor International estimates the $375 million market will quickly grow to be worth $675 million in 2018. The country’s 51 million population consumed an average of 3.2 litres per person in 2013, a tenth of the volume washed down in neighboring Thailand.
Capturing the loyalty of the growing number of young drinkers will be as important as keeping the existing customer base, said Fujiwaka.
“We have to be innovative,” he told Reuters. “They do not want to drink what their fathers drank.”
MBL plans to introduce a new premium beer to compete with Carlsberg and Heineken’s play for the pricier market.
MBL is not alone in responding to the threat from challengers who until recently were locked out of the country.
State-owned telecoms provider Myanmar Posts and Telecommunications (MPT) struck a deal with Japan’s KDDI Corp and Sumitomo Corp last year to compete against foreign telecoms firms in the newly opened sector.
MPT plans to start selling pre-loaded SIM cards to tourists for a couple of dollars, unthinkable just a few years ago when a SIM cost hundreds of dollars and mobile phones were a rarity.
State-run Myanmar Airways rebranded itself as Myanmar National Airlines last year. It has upgraded its fleet and added international routes.
One of the few reminders of the company’s past is its airline code, UB, a throwback to the country’s former name, Union of Burma.
24 Дек. 2015