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Brandwerk Ltd. Macau Business expansion
|Keyword:||Brandwerk Ltd. Macau Business expansion,FMCG,Alcohol beverages,Spirits,Beer,distribution business,|
Brandwerk Ltd. Macau Business expansion,FMCG,Alcohol beverages,Spirits,Beer,distribution business,
|Publication Year :||2019|
SAR Macau is a special administrative region of the People’s Republic of China on the western side of the Pearl River estuary in southern China. As part of the Great China region, Macau is one of the most densely populated region in the world that has approximately has 500,000 people(based on IMF data) in an area of 32.9 square kilometres.
After a long downturn and heavy restriction of financial access for gambling activities and money laundry among Chinese communist party officials and leaders of China’s national corporations’, Macau’s economy returned to growth starting in 2017.
Beer, liquors, spirits and in particular Scotch and Cognac category boost growth in an overall demand despite 4 years downturn.
Alcohol beverage category in Macau segmented and based on inbound and outbound consumption. Tourists are the main drivers for an alcoholic beverages consumption. Strong interest among visitors of Macau in on-trade and off-trade consumption are led by young male and female that are in particular visiting or passing through the territory daily and also by heavy gamblers that gained to have an access to Macau. Significant growth of tourists seen on long weekends and national holidays in Hong Kong, Taiwan and China.
Macau remains second most important port of entry to China after SAR Hong Kong, therefore big multinationals are paying high attention to this market, but due to the low taxation & high-risk of trading goods into China, investments into Macau stays limited that led smaller distribution business having a chance to occupy and grow this market.
Economy: The economy still heavily dependent on gambling revenues.Chinese government is urging Macau to diversify its industry to bring in more revenue from mainstream tourism and other sources.
Demographic: Population in Macau is growing slowly and ageing rapidly. The territory’s Portuguese heritage is an evident in the strength of mix between traditional Portuguese and Macanese culture that had massive influence on a high demand for Portuguese products.
Brandwerk Ltd. has started as an independent distribution business in Hong Kong in 2006 and over the 10+ years became a valuable partner for many family owned breweries & distilleries from Europe, America and Australia in markets such as Hong Kong, Taiwan and China.
The key differences between Brandwerk and other dominant players in the market are reliability, constant innovations, cost- and value-orientation, transperancy and the most important delivery of the results.
Macau remained for us a main territory of distribution that was outsourced to the sub-distributor and now we are ready to allocate finances and grow our presence in there.
The intention is to begin with core distribution portfolio of Brandwerk and add-on products that will show a rapid growth.
The business start up costs are mainly funded by retained earnings that was accumulated in other markets and independent director’s investments. Financial projections are very conservative, over estimating costs and assumptions of the worst-case scenario with regards to revenue forecasts.
Five-year financial projections reflects healthy growth year-on-year. Using a weighted average assuming a 1:1 sales mix for each variety, the break-even point has been estimated at 27516 units which translates to $4,318,708 MOP in annual sales. At current projections it will be achievable starting from Year 3 onwards.
|Appears in Collections:||管理學院企業管理專班(Global MBA)|
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