Executive Summary

Case Statement:
Anheuser-Busch InBev (AB InBev) stands to lose consumers over the next several
years due to the competitiveness of the beer brewing industry. The introduction of
craft beer by competitors, and the increased health concerns of consumers has
threatened the company’s operating income and revenues.
Mission & Vision Evaluation:
Anheuser-Busch InBev’s mission statement is to “Be the world’s beer company.
Enrich and entertain a global audience. Deliver superior returns to our
shareholders.” The mission statement only meets four of the nine components that
build a strong mission statement. Customers, markets, products or services, and
concern for survival, growth, and profitability are the four components that the
mission statement touches on. AB InBev’s vision statement is strong in what the
company is striving for.
Milestones:
• 1860: Bavarian Brewing Company was started.
• Early 1870s first American brewer to utilize pasteurization.
• 1876: Created Budweiser and coined the “King of Beers.”
• 1879: Company renamed Anheuser-Busch Brewing Association.
• 1901: Anheuser-Busch Brewing Association broke the 1 million barrels of
beers sold.
External Assessment:
Opportunities
• Research partnership focusing on infusing beverages with THC and CBD
oils.
• Use of renewable energy sources.
• Hybrid, bio-diesel, compressed natural gas beer delivery trucks.
• Increase in awareness allows for stronger presence globally.
Threats
• Increased taxes and tariffs on aluminum.
• Underage drinking.
• Changing alcoholic beverage preference.
 • Higher production costs.
Internal Assessment:
Strengths
• Social responsibility.
• Partnering with Lyft and/or Uber for ride-assist programs.
• Marketing to consumers to form an emotional attachment.
• Company branding.
Weaknesses
• Rise of the dollar against foreign currency.
• Legal issues associated with selling alcoholic products in other countries.
• Poor organic growth.
• Lack of attention with respect to craft beer market.
Industry Analysis:
There are several competitors in the beer brewing industry and more develop every
day. Rivalry amongst competitors tends to drive down the profitability of the
beverage-brewing industry. Competitors always find ways to undercut other
company’s in order to gain recognition. New entrants to the industry could be
considered potential threats. In the brewing industry, it is in the best interest of the
suppliers and producers to assist each other through bargaining power of suppliers.
This will assist with negotiations of suppliers. The bargaining power of buyers
tends to drive the competitive advantage when it comes to purchasing or choosing
another product over an old standard that they are used to. Through innovation and
technology improvements AB InBev will retain current customers while drawing
others to the brand.
Financial Analysis:
AB InBev is above the industry standard for five-year net income five-year annual
average increase of 1.9% which is above the industry. The company’s sales
revenue for the five-year annual average is 7.26% which is nearly double that of
the industry standard of 4.01%. AB InBev’s gross margin is currently at 62.73%
which is higher than the industry standard for this category. Due in part to the
purchase of SABMiller in 2016, AB InBev’s current ratio is at 0.67 versus the
industry standard of 1.42. This is expected to change as the company works toward
paying off its loans and deleveraging.
Competitive Strategies:
SWOT Matrix for Anheuser-Busch InBev (AB InBev)
The SWOT Matrix was used for the evaluation of the strengths, weaknesses,
opportunities, and threats due to its ease of use and functionality. With the use of
the SWOT it was a straightforward approach to an end result for each of the
categories and allowed for each of matching to determine the best strategy for AB
InBev. During this process we will be able to potentially decrease the weaknesses
and threats while providing more developmental strengths and opportunities to the
company.
SO Strategies:
• Focus on increased innovation with the highest of ingredients while
incorporating THC and CBD oils into non-alcoholic beverages. S6, S9, O1
• Provide Social responsibility by providing rides to consumers by Lyft or
Uber, every day of the year, not just peak seasons. S4, O3

WO Strategies:
• Develop a stronger craft beer division within the company to include infused
beverages with THC and CBD oils, by joining forces with other breweries
with proven success. W5, O1, O4
• Develop more organic growth options and team with renewable energy
soiurces to provide a more eco-friendly product. W4, O2

ST Strategies:
• Sell off brands that are not easily recognized and that do not turn a profit.
S1, T8
• Develop a program that will help to off-set underage drinking and reduce
consumer health concerns. S4, T2, T5

WT Strategies:
• Collaborate to determine a more cost-effective way of distribution of beer by
potentially reducing use of the aluminum can. W1, W3, T3, T4
• Focus on what younger generations are looking for in an alcoholic beverage.
Research and develop products that are geared toward Milennials. W6, T1
AB InBev will need to take into consideration social responsibility, selling off
brands that do not profit, and innovation and technology in order to raise social
awareness and responsibility, eliminate excess costs and continue to innovate
products based on new technologies.
Raise Social Awareness and Responsibility. AB InBev needs to heighten their
current campaigns in regard to social awareness and responsibility. With the
addition of a ride-assist program that will partner with Lyft and/or Uber initially,
the company stands to be an innovator in this sector of social responsibility.
Stronger marketing to specific target markets and demographics with the initiation
of ride credits for consuming the AB InBev alcoholic products consumers will
benefit and help to reduce the risks associated with drunk or impaired driving. This
will also reduce the amount of fatalities that are related to drunk or impaired
driving.
Eliminate Excess Costs. Since the acquisition of SABMIller, AB InBev increased
the various types of alcohol to over 200 brands. There are several of these brands
that do not make the profit margins that are realistic of continued production. By
the company eliminating the production of these products, this will help their
bottom-line in that it will reduce manufacturing costs, packaging, advertising,
along with other areas associated with the production and selling of such items.
Continue to Innovate Products Based on New Technologies. Although AB
InBev currently does extensive research on its products and is always looking for
new ways to improve their beer brewing processes and tastes, the company needs
to expand in new directions. Through the incorporation of THC and Cannabis oils
being infused into non-alcoholic beverages is something that is coming to the
forefront for the company. Consumers constantly look for new and improved
products, without these aspects, the company stands stagnant and will lose not only
consumers but, profits as well.
Recommended Strategy:
Through increased social responsibility and partnering with ride-assist programs
the company will continue to grow, gain new consumers, and reduce costs of
potential lawsuits. AB InBev will be able to achieve this by emotional marketing
and advertising along with in-depth developments of campaigns and solutions to
the current issues pertaining to health and underage drinking. The company will
also be able to show stronger numbers in the ride-assist program and will be a
forerunner of its competitors for doing so.
The company would be able to determine target markets and demographics to
initially role this program out to the United States initially and then research to
determine the feasibility of taking it globally. AB InBev would issue electronic
coupons for those that consume their beverages. The company is still selling its
product thus, increasing revenues while in the same sense helping the consumer to
get to and from their destination safely. This is also a form of advertising their
product and by collaborating with companies such as Lyft and Uber there is
increased promotional opportunities available.

Ethical & Social Responsibility Dimensions of Recommended Strategy:

The company continues to advertise and have campaigns that provide social
responsibility and awareness of the dangers of the consumption, driving while
intoxicated and the grave potential for death.

Since the company has many dealings with smaller subsidiaries of the parent
company in different countries. It is imperative that they continue to comply with
the appropriate laws internationally as well as not losing the integrity of the
company in the process. Laws change so frequently that the parent company needs
to be engaged in the laws of each of the companies in which it does business, is
producing or shipping from.

Implementation Plan:
Anheuser-Busch InBev will develop an implantation plan which will be all
inclusive of organized company-wide meetings with open communication, to
determine marketing strategies, operational and financial impacts of the
implementation of the ride-assist program. The focus will be the review of the
goals and implementation of key components with instituting the program and how
this type of innovation will promote sustainable growth in the company long-term.
The ride-assist program that is being promoted will be a means to excite and
encourage employees to participate in the founding stages of this program and see
it through implementation.
There will be a division of the tasks by departments in order to achieve the
company’s end result. This process will also ensure that the tasks are being
completed in an aggressive and timely manner. By have the different business
departments (Operations, Finance, Marketing, Research and Development and
Human Resources) working on the project, this will allow AB InBev to reduce
costs while achieving the final goal of the project.
Initial costs are estimated at $121M that will be financed through debt financing.
Once the program is up and running the initial financing will be able to be paid off
and the continuation of the program will be funded through sales of the program.
The outlook for the company with this program is that they will see 10% increases
in alcohol sales over the next three years, with the use of the coupon or rewards
system that is put in place with the partnership of a ride-assist company.