Question

If Heineken Brewery expanded in the United States and Mexico. How would this be beneficial to the company?

Answer 1

Heineken Brewery has plans to oepn their new brewery in Meoqui, Chihuahua in Mexico. This will have a production of 6 million hectolitres per year and will produce all the leading brands beer. The production will be for Mexico as well as for exports. In this way the Company can increase its production as well as expand its presence everywhere. The countries like Mexico and United States are rich in culture and has dynamic economy. Fast development and growth is seen in almost all sectors in these countries which will help to drive constant growth in the national beer market.

Moreover, the company can create a significant economic advantage to the area which will be a reference to the state and an incentive for other industries. Also the government is helping them to create ties with the private sector to advance projects that drive progress and the fuel the local economy. The Company can get a additional potential here due to the fast developing economy, a rich geographical and demographic diversity and a flourishing beer sector. The company is also setting up the new unit keeping in consideration all the necessary rules to conserve the environment, waste water management, conserving electricity etc so the government of these countries are also helping them to set up their brewery.

Also all the Heineken beers are brewed and bottled in the Netherlands and shipped via the sea to various demand points in the United States. This involves a lot of expenses and undue wastage of money, energy and time. If a brewery is opened in the U.S. then these expenditure can be reduced and the time involved in exporting these beer will also be reduced. Rather it will be produced in the U.S only and those funds can be instead used to increase the production and make more profits. Also the company can get cheap local workers.

In this way, Heineken Brewery will be benefitted in many ways if it gets expanded in the U.S. and Mexico.