Market Analysis:

China is the world’s number one beer producing nation according to China’s
Beer Association. China has maintained its position as the world’s biggest beer
producing nation with more than 410 million hectolitres in 2008, which is four times
the volume produced in Germany. China also recorded the highest growth in output of
all countries in 2008, with more than 17 million hectolitres. Germany, with beer
output of about 103 million hectolitres, is now in fifth position in the world rankings,
behind China, the USA, Russia and Brazil.
As the intentions and emphasis of Chinese government which was originally
based on Mineral extraction process has drifted over to brewing industries, this is the
right time for Eager’s beer to hit the Chinese market. This could be directed by
implementing modern and updated production techniques.
By analysing the pros and cons of Chinese beer market we can come to a
conclusion that though the beer market is saturated with a good number of brewing
companies which can give a tough competition, the market is still in a greater need of
a kind which can manufacture competitive drinks at competitive prices with
implementation of its newer and cutting edge technologies.
Keeping in mind that our company is going to operate in a monopolized
market our marketing strategy would play a vital role as it has to fit itself between our
production abilities, the benefits it will yield and the expectation of Chinese beer
market. Thus Aire Valley is expected to have a warm welcome.

PEST Analysis of Chinese Beer Market:

Political:
WTO membership in 2001 opened Chinese spirits market.
MODERNISATION: Focusing on Internationalization by making move in the
western market.
COUNTERFEITING: Use of fake labels and bottles with cheap foreign spirit were
sold to inexperienced customers.
Government Control & Political Instability: China is a Communist State and, as such,
can exercise complex regulatory controls favouring certain industries. Instability is al
ways simmering beneath the surface and fast growth often means significant growing
pains

Economic:
ECONOMIC GROWTH: Real GDP growth is expected to increase after slowdown from
8.50% in 2009 to 9.01% in 2010
MARKET SIZE: Sales of spirits must grow from 12% to 14%
TAXATION: Spirit Consumption Tax is a combination of 20% ad valorem tax and unit tax at
1yaun/kg.
Rise in earnings of the middle and low income groups and pensions for retirees.
Social:
Population growth rate is 0.655 in 2009 with average life expectancy of 73.47yrs.
Spirits consumption is higher during festive holidays and people are getting aware of
health aspect of alcoholic drinks.
older population of china

Technological:
MEDIA: Communications through symbols is preferred in local markets.
INTERNET:"Great firewall of china" controls and tracks websites to situate with the
policies of Chinese government.
DISTRIBUTION: Limited to Chains of supermarkets and specialist retailers.