1. ANHEUSER-BUSCH COMPANIES, INC.
Louise Philbrick
Keith Grant
David Guerra
All pictures from anheuserbusch.com

2. Overview Strategic analysis History SWOT Matrix Who we are today
Space Matrix
Grand Strategy Matrix
BCG
IE Matrix
Strategic Summary
Possible Strategies
QSPM
Decisions
Implementation
History
Who we are today
Vision and Mission
External Audit
EFE
CPM
Internal Audit
IFE

3. History
1852- George Schneider founded Bavarian Brewery in St.Louis Missouri
1857- Adolphus Busch arrived in St. Louis
1860- Eberhard Anheuser acquired Bavarian Brewery

4. History 1870’s Production: 18,000 Barrels
Anheuser Busch became 1st U.S. Brewery to adopt the use of pasteurization
40 Refrigerated railcars
1880’s
Acquired rights to bottle and sell Budweiser( )
Production: 739,951 Barrels

5. History
1881
Adolphus Busch Glass Manufacturing Company began Production

6. History
1901
1st time to break the million barrel mark within a year 1,006,494
1920
Jan 16th National Prohibition took affect
Began production of other goods ex: ginger ale, root beer, ice cream, and malt syrup
1933
Prohibition repealed

7. History 1940- surpassed the three million barrel mark
1953- Clydesdales first appeared in the tournament of Roses Parade
1961- Michelob was for the first time sold in bottles

8. History 1974 1980 The 30 million barrel mark was passed
Anheuser Busch signed a licensing agreement with Labette Brewing Company of Canada to brew and sell Budweiser in Canada

9. History 1991 Federal excise tax doubled on beer 2000
20th Anniversary of companies listing on NYSE
Total global volume million barrels
2001
Bud light became the #1 selling beer in the U.S.
2002
Anheuser Busch 150th Anniversary

10. Who we are Today
Anheuser-Busch Companies business segments consist of: domestic beer, international beer, packaging, entertainment and other.

11. Who We Are Today
The domestic beer segment consists of the Company's United States beer manufacturing and wholesale sales operations.
ABI has 12 deliberately placed domestic breweries to maintain an effective nationwide distribution.
Besides its St. Louis headquarters, Anheuser-Busch Inc. operates breweries in Baldwinsville, N.Y.; Cartersville, Ga.; Columbus, Ohio; Fort Collins, Colo.; Houston; Jacksonville, Fla.; Los Angeles; Fairfield, Calif.; Merrimack, N.H.; Newark, N.J.; and Williamsburg, Va.
ABI sells approximately 2.5 times the volume of its closest domestic competitor

12. Who We Are Today
The international beer segment consists of export sales and overseas beer production and marketing operations, administration of contract and license brewing arrangements and equity investments.
In 2002 global sales reached 8 million barrels
ABI has established business with China, Japan, Brazil, India, Italy, France, Switzerland, and Spain since 1993
They have expanded their international market so much because of all the changes i.e.. growing prosperity in Latin America, and nations shifting their preference from traditional wine drinking towards beer

13. Who We are Today
The packaging segment is composed of the Company's aluminum beverage can and lid manufacturing, aluminum recycling, label printing and glass manufacturing operations.
Anheuser Busch is the world’s largest recycler of aluminum beverage containers

14. Who We are Today
The firms packaging operations are handled through the following subsidiaries
Metal Container corporation
Manufactures cans and lids for ABI
Anheuser-Busch Recycling Center
Recycles aluminum cans at the plant located in CA.
Is the world largest recycler of aluminum cans, also help to reduce production cost

15. Who We are Today Precision Printing and Packaging
Produces more than 25 million labels for ABI and other companies at its location in Tennessee.
Provides 80% of Anheuser – Busch’s labels
Eagle Packaging Inc.
Supplies all ABI liner material.
Longhorn Glass Corporation
Produces over 60% of the glass bottles that are used in the Huston brewery.

16. Who We are Today
The entertainment segment consists of its theme park operations, and real estate operations.
Busch Entertainment Corporation (BEC) operates Busch gardens in three cities, Sea World in three cities, along with Adventure Island, Water Country USA, Sesame Place, and Discovery Cove.

18. Who we are Today
Anheuser Busch subsidiary Busch Properties Inc. (BPI) owns and operates The Kingsmill Resort and Conference Center in Virginia.

19. Competitors The Miller Brewing Company
2nd largest brewery in the US is the
With sales in over 80 countries
Offers over 50 brands of beer
The Adolph Coors Brewing Company
3rd largest brewery in the country
Among Coors product Coors Light is the 4th largest selling beer in the nation

20. Vision Statement
“through all of our products, services and relationships, we will add to life’s enjoyment”

21. Current Mission Statement
Anheuser-Busch’s mission is to ensure the following three goals are met
Be the World’s beer company
Enrich and entertain a global audience
Deliver superior returns to our shareholders

22. Proposed Mission Statement
Anheuser-Busch Companies, Inc. is a global company (3) that is committed to being the leader in both domestic and international beer markets, enriching and entertaining a global audience, and delivering superior returns to our shareholders with strategic real estate investments and packaging operations (2,7). Through technologically improved (4) products and services (4) Anheuser strives to achieve sustainable growth and profits for all stakeholders (5,9). We emphasize responsible consumption, preservation and protection of the environment, and exceeding customer expectations in all our operations (6,8).

23. External Audit Opportunities
Governmental restrictions are much lower in the countries that Anheuser-Busch is expanding to
There has been a noticeable shift in consumer preferences toward beer in traditional wine-drinking countries.
An expected increase in the domestic number of beer drinkers over 21 should contribute an additional 1% annual gain in beer sales for the next few years
Demand for American brews in Asia, Latin America, and Europe is growing
Quickly growing populations in developing international markets
Americans have experienced annual increases in disposable income since 2000.
Threats
The domestic beer marketplace is highly regulated
There have been sharp increases in federal excise taxes on alcoholic beverages
International breweries and microbreweries expanding into the USA
Domestic population only increases at an annual rate of about one percent. (limited growth potential for domestic beer and entertainment operations)
Changes in people’s disposable income may have unfavorable effects

24. EFE Matrix Key External Factors Weight Rating Weighted Score
Opportunities
1. Governmental restrictions on beer exist in countries into which A-B is expanding
0.25 4
1.00
2. Noticeable shift in consumer preferences towards beer
0.05 3
0.15
3. An expected increase in the domestic number of beer drinkers over 21 should contribute additional 1% annual gain in beer sales for the next 3 years
0.075 2
4. Demand for American brews in Asia, Latin America, and Europe is increasing
0.1
0.4
5. Quickly growing populations in developing international markets
0.3
6. Americans have experienced annual increases in disposable income since 2000
0.025

25. EFE Matrix Threats Weight Rating Weighted Score
1. The domestic beer marketplace is highly regulated
0.25 2
0.5
2. There have been sharp increases in federal excise taxes on alcoholic beverages
0.025
0.05
3. There have been sharp increases in federal excise taxes on alcoholic beverages
0.075
0.15
4. Domestic population only increases at an annual rate of about one percent. (limited growth potential for domestic beer and entertainment operations)
5. Changes in people’s disposable income may have unfavorable effects 3
Total
1.00
2.9

26. Competitive Profile Matrix

27. IFE Matrix

28. Financial Ratio Analysis

29. SWOT Matrix S-O Strategies W-O Strategies S-T Strategies
1. Reinvest in core business to improve
efficiency and add capacity as needed
1. Increase preventative education
expenses to maintain good public image
2. Increase equity investment in Tsingtao of
China and CCU of Chile
S-T Strategies
W-T Strategies
1. Adjust pricing strategy to offset excise
taxes
1. Adjust policies and procedures regarding derivatives and hedging in the event of potentially negative foreign currency exchange
2. Continue dominating market share through extensive advertising

30. Space Matrix
Conservative
Aggressive
Competitive
Defensive

31. BCG Matrix

32. IE Matrix

33. Grand Strategy Matrix RAPID MARKET GROWTH Quadrant II Quadrant I
WEAK COMPETITIVE POSITION
STRONG COMPETITIVE POSITION
Strategies
1. Concentric diversification
2. Horizontal diversification
3. Conglomerate diversification
4. Joint venture
Anheuser-Busch
Quadrant III
Quadrant IV
SLOW MARKET GROWTH

34. Net Worth Analysis SE + Additional paid in capital + retained earnings
$3.052B + $1.025B + $12.544B $16.62B
12/31/02 Net Income x 5
$1.934B x 5 = $9.67B
Share Price (1/1/02) / EPS (1/1/02) x avg. net income (3 years)
$45.21 / 1.91 x 1.73B $4.09B
Number of shares outstanding x share price
866M x $48.40 = $4.19B
Method average = $8.64B

35. Strategic Summary Alternative Strategies IE Space Grand Total
Forward Integration X 2
Backward Integration
Horizontal Integration
Market Penetration
Market Development
Product Development
Concentric Diversification
Conglomerate Diversification
Horizontal Diversification
Joint Venture 1

36. Possible Strategies
Increase presence in Asian, eastern European, and Latin American markets
Unload less profitable theme parks and possibly expand the more profitable parks
Continue to dominate market share with extensive advertising
Increase education on responsible consumption to maintain good public image

37. QSPM

38. QSPM

39. Decisions Primary Possibilities
Increase presence and awareness in Asian, eastern European, and Latin American markets
Possibilities
Continue to dominate market share with extensive advertising
Increase education on responsible consumption to maintain good public image
Unload less profitable theme parks and possibly expand the more profitable parks

40. Implementation
Invest $182 million over three years in Tsingtao Brewery Company, Ltd. Of China. This investment will increase Anheuser-Busch’s equity interest to 27% of Tsingtao.
Invest if needed $165 million in Compania Cervecerias Unidas S.A. (CCU), the largest brewery in Chile. This investment would increase Anheuser-Busch’s equity interest in CCU from 20% to 30%, and would make Anheuser-Busch products more available in the Latin American markets.

41. Anheuser-Busch in the Media