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    Business Ethics in Liquor Industry

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    Mahesh Jagadale
    The document discusses business ethics in the Indian liquor industry. It provides an overview of the industry, noting that it is growing at 12-15% annually and generates Rs. 16,000 crore in revenue. It outlines some ethical practices like health warnings on bottles but also unethical practices like targeting minors and surrogate advertising. It also describes two case studies, one on Kingfisher Beer's sponsorship activities and another on an anti-liquor protest movement led by women in Andhra Pradesh in the 1990s.

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    Business Ethics in Liquor Industry

    Uploaded by

    Mahesh Jagadale
    366 views33 pages
    The document discusses business ethics in the Indian liquor industry. It provides an overview of the industry, noting that it is growing at 12-15% annually and generates Rs. 16,000 crore in revenue. It outlines some ethical practices like health warnings on bottles but also unethical practices like targeting minors and surrogate advertising. It also describes two case studies, one on Kingfisher Beer's sponsorship activities and another on an anti-liquor protest movement led by women in Andhra Pradesh in the 1990s.

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    The document discusses business ethics in the Indian liquor industry. It provides an overview of the industry, noting that it is growing at 12-15% annually and generates Rs. 16,000 crore in revenue. It outlines some ethical practices like health warnings on bottles but also unethical practices like targeting minors and surrogate advertising. It also describes two case studies, one on Kingfisher Beer's sponsorship activities and another on an anti-liquor protest movement led by women in Andhra Pradesh in the 1990s.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    366 views33 pages

    Business Ethics in Liquor Industry

    Uploaded by

    Mahesh Jagadale
    The document discusses business ethics in the Indian liquor industry. It provides an overview of the industry, noting that it is growing at 12-15% annually and generates Rs. 16,000 crore in revenue. It outlines some ethical practices like health warnings on bottles but also unethical practices like targeting minors and surrogate advertising. It also describes two case studies, one on Kingfisher Beer's sponsorship activities and another on an anti-liquor protest movement led by women in Andhra Pradesh in the 1990s.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
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    The document discusses the history, overview and status of the Indian liquor industry. It provides details about major players, brands and their market shares. It also discusses cases of anti-liquor protests and suggestions to control unethical behaviors.

    The Indian liquor industry comprises of Indian Made Foreign Liquor (IMFL) and Country Made Liquor. IMFL's total business is INR 6150 Crores while Country Made Liquor's business is INR 2350 Crores.

    Some key facts about the Indian liquor industry are that it generates Rs. 16,000 crore annually, whiskey accounts for 60% of liquor sales, duty on foreign distilleries is 464-706%, and Maharashtra, Uttar Pradesh, and Tamil Nadu have a liberal alcohol policy.

    Business Ethics in

    Liquor Industry

    Group Members

    Sailee
    Patil

    Utkarsh
    Achrekar

    Mahesh
    Jagdale

    Prasad
    Tarker

    Background
    Origin of "liquor" and its close relative "liquid"
    was the Latin verb liquere, meaning "to be fluid
    Earliest reference to alcohol ( Somras & Sura)
    traced to year 2000B.C

    INDUSTRY OVERVIEW
    Indian Liquor Industry with
    market value of INR 8500 Crs.
    against INR 900 Crs. in 1999 &
    is growing at 12-15% P.A over
    last 2 years.
    The Indian liquor industry
    comprises of
    -IMFL, Indian Made Foreign
    Liquor, and
    -Country Made Liquor
    IMFLs total business in market
    INR 6150 Crs.
    Country Made Liquors business
    INR 2350 Crs.

    Background
    First Indian brewery set up (1805) in
    Kanpur IMFL by Carew & Co.Ltd.
    Excise Committee (1905) to control
    rise in consumption
    Alcohol Advertisement
    -Surrogative ads
    Industry faced criticism for targeting
    young people

    Status Of Alcohol Industry In


    India
    Generates Rs.16,000 crore per annum
    Alcohol sales proceeds account for
    45%of the total revenue collection in
    the country
    Whiskey - 60% of the liquor sales
    Rum- 17%
    brandy- 18%
    Vodka - 6%

    Status Of Alcohol Industry In


    India
    Duty on foreign distilleries = 464706%
    Domestic industry accounts for 99%
    of the market share
    Maharashtra, Uttar Pradesh, and
    Tamil Nadu have a liberal policy

    Major Players And Their


    Market Share

    Market Size
    70 million cases market
    Growth rate :- 10-12 % per annum
    Major market zone:- South and West
    account for bulk (> 75 %) of this market
    Major beer consuming centers :Maharashtra (Mumbai),Karnataka
    (Bangalore), Tamilnadu (Chennai)

    IMFL Categories: Market size (in


    %)

    Major Brands
    Major beer brands (manufacturers)

    King Fisher

    Kalyani Black Label (UB Group)

    Golden Eagle (Mohan Meakins)

    Haywards (Shaw Wallace)

    London Pilsner(Associated Breweries


    and Distilleries)
    Foreign brands

    Strohs

    Fosters

    Company

    Market Size (mn


    cases)

    Brands

    Herbertsons

    Bagpiper

    McDowell & Co.

    17

    McDowell no.1,
    Diplomat

    Shaw Wallace

    Directors Special

    UDV

    Over3

    Green Label, Smirn Off

    Bacardi

    0.1

    Bacardi Rum

    Seagram

    0.8

    Royal Stag

    Other Players
    Ace Continental Exports - Manufacturer of beer
    Amrut Distilleries - Supplier of dark rum, brandy
    and whisky
    Champagne Indage - Producers of still &
    sparkling wine
    Chateau Indage - Sparkling wines manufacturer
    Cobra - Beer manufacturer
    Dajeeba Vineyards - Red and white wine
    manufacturer
    Kem Liquors - Rum and brandy bottling services

    Contin..
    Liquors India - Manufacturer of liquor
    ND Wines - Red, white and appetizer wines producer
    Radico Khaitan, Rampur - Liquor manufacturer
    Shaw Wallace - Producers of spirits and beer
    United Breweries - Kingfisher - A leading brand of
    Indian beer from the UB group
    Vinbros & Co - Manufacturer of whisky, vodka,
    brandy, rum & gin

    Ethical And Unethical Ways


    Of Business Conduct In
    Liquor Industry

    Ethical Ways Can Be:Writing on the bottles that liquor is


    harmful for health.
    Sometimes it is important to use in
    medical purpose.
    Sponsorship of sports, social and
    cultural events that is surrogate
    advertising.
    Uniform Federal Excise Policy
    Strategic tie up with global players

    Unethical Ways Can Be: On one hand, govt. says, put a label
    saying liquor is harmful to health" to
    people on the other side of the fence it
    may sound unethical but to
    manufacturers or brand owners it is a
    necessity because any business which
    is allowed under the law has a right to
    advertise and market their product.
    By denying them that right, we are
    transgressing the law.

    Unethical practices in LIQOUR


    Industry
    Unauthorized stocking of Liquor
    Not acquired appropriate licenses for the sale of liquor
    Sale of liquor on dry days
    Surrogate advertising to mislead the common man
    Selling liquor to minors over the counter at wine shops
    No stringent standards maintained at the time of

    manufacturing liquor
    Selling of expired stock to addicted people at cheaper

    rates
    Sale of unauthorized liquor (desi ,khamba ,tharra)

    RESTRICTIONS ON LIQUOR CONSUMPTION


    (1)Legal Drinking Age
    (2)Drunk Driving Law
    (3)Advertisements
    (4)Dry Days
    (5)Dry Days by State

    CHALLENGES
    High taxation
    State wise regulations
    Social taboo
    Consequences of men often
    spending large portions of
    their meager daily wages on
    liquor while their families go
    without food & shelter
    Support to the prohibition of
    alcohol by some womens
    social groups

    CHALLENGES
    Ban on advertising
    Counterfeit
    Point of sales and unorganized
    retail
    Aggressive official anti-alcohol
    abuse initiative through
    advertisements & campaigns

    ADVANTAGES OF BEER
    Source of vitamins, minerals and
    flavonoids
    Coronary heart disease (CHD)
    Cholesterol
    X-Rays radioprotection
    Cheaper

    DISADVANTAGES OF BEER

    Beer belly
    Heartburn
    Blood pressure.
    Intoxication & Dehydration
    Impairment of drivingrelated skills

    Case Lets
    Case 1 Kingfisher Beer
    Case 2 Anti-Liquor protest &
    Govt.

    Case 1 Kingfisher Beer


    Kingfisher -solid beer brand in south and west India
    which are major areas of beers consumption.
    Liquor advertising is banned in print and electronic
    media, liquor companies have resorted to surrogate
    advertising, which are soon to be banned by govt.
    As a result, liquor industries could promote
    themselves only through sponsorship of sports
    events, contests and fashion shows.
    Kingfisher already has stopped surrogate
    advertising.
    In Kingfisher Derby which is held in Bangalore every
    July, kingfisher beer brand is promoted.
    also, Mr. Mallaya sponsored Kingfisher Fashion
    Awards , presenting Ritu Beris Collection in Paris.

    Case 2 Anti-liquor Protest & Govt.


    In 1990, the women of Dubagunta, a small village
    in the Nellore district of the south Indian state of
    Andhra Pradesh began an anti-liquor protest.
    They pressurized men to swear that they would
    stop drinking, physically restrained habitual
    drinkers, attacked liquor shops and godowns and
    fought with the police, liquor mafia and the
    drunks.
    The movement spread like wildfire to 800 villages
    throughout the state.
    Women in these 800 villages not only prevented
    the entry of liquor into their villages, but also
    prevented district collectors from holding liquor
    shop license auctions.

    Explaining that those women are tortured to


    intolerable limits by the abuse and beatings of
    drunk husbands and the hunger and poverty in
    which their children grow and die, women have
    taken up the step.
    It was reported that the women were beaten with
    rods, sticks, boots and rifle butts by the liquor
    contractors' henchmen as well as the police force.
    Non-bailable cases were filed against agitators
    who were then imprisoned.
    There were even reports that many women
    activists were raped and murdered.
    These events became a matter of national debate
    and eventually led to the then Congress
    government of Andhra Pradesh announcing a
    statewide ban on the sale of liquor from October
    1993.

    The AP government lost $ 362 million in annual


    revenues after the prohibition. Despite new taxes
    on vehicles and consumer goods, the state's
    budget deficit rose to $ 242 million.
    Prohibition continued in the state till 1997.
    In the same year, the new CM Chandrababu
    Naidu lifted the ban on liquor, claiming that he
    was forced to do so because of the state's
    financial problems.
    This move met with unprecedented criticism in
    the media. Critics claimed that the state could
    have easily avoided unnecessary expenditure on
    many other fronts, such as salaries and various
    subsidies.

    Suggestions To Control
    And Minimize Or Eliminate
    Unethical Behaviors In
    Liquor Industry

    Unethical Behavior
    * Abuse of inmate
    * Inappropriate relationships with inmates
    * On-duty misconduct
    * Off-duty misconduct
    * Introduction of contraband

    How To Avoid Unethical


    Behavior
    The Initial Complaint
    Confidentiality
    Interviewing Witnesses/Obtaining
    Documentary Evidence
    Polygraph
    Photo Lineups
    Positive Action
    Law and public policy

    Thank you..!

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