Indian Alcoholic Beverages Industry: A Strategic Analysis

Abstract

The Indian Alcoholic Beverages Industry is under the process of phased liberalization and hence is going through turbulent transformation. The changing environment demands fresh thinking and a re-look at the strategy to gain the cutting edge. This paper attempts to look at the various macro and micro environmental factors operating in the industry to gain a holistic understanding of it. The paper uses the model of strategic analysis by George Day to analyze the bargaining power of buyers and suppliers, the threat of new entrants, threat of substitutes, intensity of rivalry, impact of technological changes, growth & volatility of the market and the influence of government and regulatory interventions. These variables affecting the industry have been categorized as favourable or adverse which accordingly influence the profitability of the industry. The paper also identifies some strategic initiatives, which can be adopted to leverage the favourable forces and protect themselves from the adverse ones. A good understanding of the industry enables management to detect opportunities early and exploit them forcefully.