Beer Market In Norway Essay, Research Paper

Beer Market in Norway

By Nathan S Hosley

The beer industry is an of all time present and turning industry in Norway. The people of Norway have a long history of imbibing beer. Even though the revenue enhancement on beer is the 2nd highest in the universe Norwegians continue to imbibe abundantly. Norwegians spend more money on beer per capita than any other nationality. ( Turborg P1 )

Norsemans are really proud of their state and it is non an easy undertaking to vie with local merchandises ( Tuborg P1 ) , therefore, there is non a heavy market impregnation of imported beer in Norway. Heineken, Guinness, Beck & # 8217 ; s, Mac Ewan & # 8217 ; s, Newcastle Brown ale, Carlsberg, Tuborg and a few others are available but largely in bottles, barely of all time on pat. ( Burzlaff P1 )

The imported beer industry is at that place and seems ripe for person like our company to travel in on. But before leaping in we must inquire ourselves some really of import inquiries. Is at that place traveling to be adequate net income to justify a all-out run? Are the people of Norway excessively proud of their ain state & # 8217 ; s merchandises to buy much U.S. imported beer? Is the hereafter of beer gross revenues in Norway turning or worsening? Is the competition in Norway excessively fierce with the few imports already at that place being major participants in the European market? What about the state itself? Is it stable and what about its substructure?

In the following few pages I will seek to turn to these inquiries and give a personal point of view on whether or non to try to come in this market with a U.S. merchandise.

Is at that place traveling to be adequate net income to justify a all-out run?

The people of Norway spend more per capita than any other state on beer. But, the authorities besides charges the 2nd highest revenue enhancements on beer in the

World. Pripps-Ringnes, the largest beer manufacturer in Norway, claims that on a

Single bottle of beer sold for 11.55nok 7.40 goes to revenue enhancements, 1.05 goes to lodge and merely 3.10 is left for disbursals and net income. ( Pripps-Ringness P1 ) This means that merely a little per centum of income is available to pay for the store & # 8217 ; s tag up, ingredients, packaging, production, distribution, rewards, selling etc. Still, we must besides recognize that the intoxicant ingestion in Norway is lifting and is about at an all clip high with 1987 as the lone twelvemonth higher than last twelvemonth. ( Ssb P1 )

Are the people of Norway excessively proud of their state & # 8217 ; s merchandises to buy much imported beer?

The Norwegians are a really proud people with strong ties to local trade names. Almost every town in Norway has its ain brewpub and locals are really loyal. Until 1976 importers could merely sell their beers to the Norse Court and Embassies. ( Tuborg P1 ) The people of Norway are spread out and live largely in rural countries where new things tend to take a piece to make and even so the people don & # 8217 ; Ts like to alter the manner they have been making things for old ages. That is one of the chief grounds there are so few imports in the state and why the 1s that are at that place aren & # 8217 ; t making good or progressing in market portion. The 1s that are successful are the really big multinational corporations.

The largest section of people in Norway are age 25 to 35 with a high figure of singles between 25 and 30 and a much lower figure between 30 and 35. ( Ssb P1 ) This is a immature, professional market of people who want to travel out and demo off, so to talk, run into people and party before they settle down and it & # 8217 ; s excessively late.

The mean income of households aged 30 to 35 with little kids has grown 21 per centum in the last 10 old ages. ( Ssb P 1 ) This shows a greater buying power which could be transformed into beer gross revenues at both bars and at place. This shows that it might non truly be a deficiency of involvement in foreign beer but perchance the deficiency of foreign beer itself and the old absence of excess income to justify the more expensive imported beer.

Is the hereafter of beer gross revenues in Norway turning or worsening?

There seems to be a strong and turning market for beer gross revenues in Norway. Beer ingestion is about at an all clip high and contrary to rates in most European states it is lifting. Lone Norway, Unit

erectile dysfunction Kingdom, Holland,

Luxembourg and Denmark have a lifting rate of intoxicant ingestion in Europe over the past 10 old ages. ( Alcoweb P1 ) Wine gross revenues are besides down in these states which might be a factor in the addition of beer gross revenues. Overall, though, the tendency appears to be lifting and keeps rise. As far back as the Vikings, the overall civilization of Norwegians has been to imbibe beer so I don & # 8217 ; t anticipate a autumn in the degree of ingestion on the skyline.

Is the competition in Norway excessively fierce with the few imports at that place all being major participants in the European market?

One of the major disadvantages of come ining the Norse beer market is the competition already at that place. The beer industry giants of Europe are all at that place and seeking to derive market portion mundane. The job is non merely that they are already at that place but that they have distribution channels and a known name already in topographic point. The market is mostly under the control of the Norse beer companies with small room left for fledglings. The giants have already filled the room that is left. It would take a immense investing to infiltrate the market.

However, the beer market is one that tends non to be set in rock. If a company is content with its portion of the market and focal points someplace else, that leaves an chance for a rival to leap in and this might be the instance with Ringnes. Ringnes is the biggest beer manufacturer and distributer in Norway and right now is seeking to infiltrate the eastern European market, chiefly in the Baltic States and Russia. While their attending is turned eastward it could be a immense opportunity to derive land in the Norse market.

What about the state itself? Is it stable and what about its substructure?

The state of Norway is really stable. The pay rate in Norway is higher than in most states, which gives them a high criterion of life and free wellness attention. Monetary values are besides higher than most states for the same grounds so in the terminal it balances itself out. The state of Norway is non portion of the European Union and doesn & # 8217 ; Ts have programs to come in it until the state as a whole ballots in favour of going a member. This could do jobs at boundary lines with cargos acquiring held up in imposts, etc. This is besides something that must be considered in the hereafter if we enter the market and wish to come in other European markets every bit good.

The state & # 8217 ; s substructure is really good as the Norwegians are an advanced society. The roads and trains are first-class plus Norway has big entree by sea. Political hazard in Norway is minimum. They have been governed by a constitutional monarchy since 1905. The economic system is stable and boasted a big addition in existent GDP in the last few old ages. Norway is a big exporter of natural stuffs and imports about all of their nutrient. This besides means that the channels used to import beer are easier than in most states because so much of their nutrient must besides come through them. Market entree is good and although there are high revenue enhancements it is an even playing field because the local companies are capable to the high revenue enhancement every bit good. The Norse authorities has one of the highest mean revenue enhancement burdens in the universe at 46 % . The Norse Krone is rather stable and can be converted easy to dollars without job. As of October 21 1998 the exchange rate was 10 Krone for every 1.35 U.S. dollars.

There is a monolithic gap in Norway for a U.S. based company to assail. The state loves to imbibe and is willing to pay. I believe that the move should be made rapidly while Ringnes is prosecuting other markets. The people of Norway need to be shown that there are other outstanding beers and the U.S. produces some of the finest. My recommendation is to go on researching and get down developing a program of action to come in the market.

Plants Cited Page

hypertext transfer protocol: //www.ssb.no/www-open/english

hypertext transfer protocol: //pekkel.uthscsa.edu/beer/nor.html

hypertext transfer protocol: //www.alcoweb.com/english/gen_info/a? co_aspects/consumption/europe/europe.html

hypertext transfer protocol: //breweryage.com/7imporv.html

hypertext transfer protocol: //www.tuborg.com/norge.html

hypertext transfer protocol: //brewers.ca/prices.html

hypertext transfer protocol: //www.prippsringnes.com/eng/