The document contains financial information and ratios for 4 Japanese beer companies (Kirin, Asahi, Sapporo, and Suntory) for the year 1990. It also includes industry growth rates, suggested targets for 1991, and forecasts for sales, assets, investments and resources needed to achieve strategic goals for market share and growth. Key assumptions and considerations are outlined in footnotes for applying the strategic plan across multiple years and businesses within each company.
The document contains financial information and ratios for 4 Japanese beer companies (Kirin, Asahi, Sapporo, and Suntory) for the year 1990. It also includes industry growth rates, suggested targets for 1991, and forecasts for sales, assets, investments and resources needed to achieve strategic goals for market share and growth. Key assumptions and considerations are outlined in footnotes for applying the strategic plan across multiple years and businesses within each company.
The document contains financial information and ratios for 4 Japanese beer companies (Kirin, Asahi, Sapporo, and Suntory) for the year 1990. It also includes industry growth rates, suggested targets for 1991, and forecasts for sales, assets, investments and resources needed to achieve strategic goals for market share and growth. Key assumptions and considerations are outlined in footnotes for applying the strategic plan across multiple years and businesses within each company.
The document contains financial information and ratios for 4 Japanese beer companies (Kirin, Asahi, Sapporo, and Suntory) for the year 1990. It also includes industry growth rates, suggested targets for 1991, and forecasts for sales, assets, investments and resources needed to achieve strategic goals for market share and growth. Key assumptions and considerations are outlined in footnotes for applying the strategic plan across multiple years and businesses within each company.
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Figures for 1990
Net profit Sales Total assets Shareholders' Equity (or Net assets)
ROE, % ROS, % S/A A/E
Industry Growth Rate, %
Suggested Ratios for 1991
ROE, % S/A A/E ROS, %
Change in cost as percentage of sales, %
Forecasts for Sales, assets, investments and resources
Sales, 1990 Beer sales as percentage of total sales Beer sales, 1990 Market share Planned annual rate of growth of market share, % Target growth rate 1990-1991, % Beer sales, 1991 Beer assets, 1991 Beer assets, 1990 Investment required, 1991 Profit in 1991 Additional debt capacity; 1991 Total new resources available; 1991 Resources available less investment required
* The 1990 ratios (that is, ROE, ROS, S/A and A/E) are for the whole company and not for the beer business alone. For lack of information, we assume that these ratios are same for all businesseses of the firms. For Kirin, Asahi, and Sapporo, the beer business accounts for more than 80% of the revenue, so the assumption, if incorrect, would result in relatively small error. But, for Suntory, whose beer business accounts for about a quarter of its sales, this assumption, if wrong, could result in larger error. ! This assumes that the target growth in sales could be achieved by the same percentage growth in assets. In reality, however, investment could be lumpy. To take that into account we will have to prepare the plan for several years. # This assumes that the entire cost saving is implemented within one year. In reality, that could take several years. The assumption is justified here only for an academic exercise where we do not want to make financial projections for multiple years. $ A positive number indicates that the stratregy appears to be financially feasible. The company will have the resources to meet the investment required. @ Here, for Suntory, I have suggested ROE equal to the industry rate of growth. But you should try out different ratios. What happens when suggested ROE is less than industry rate of growth? Do you have enough resources to implement your strategy? % For Kirin, I have suggested an ROE that is equal to its current ROE which happens to be higher than the industry rate of growth. One could suggest a lower ROE, but management and other stakeholders may not accept. A higher ROE may require reduction in cost. & Here I have suggested firm's rate of growth equal to that of the industry. This means that firm's market share should remain constant. A lower rate of growth would mean loss of market share. Such a strategy is easier to implement financially, but may not be desirable. A higher rate of growth would mean increase in market share, but would be very expensive. ^ Here I have taken planned annual growth of market share as 0%. But you can try out different numbers. If market share is planned to grow at a positive non-zero rate, you will see an increase in investment required. If market share is planned to go down, investment required will also go down. You should also understand that if a firm plans for an increase in market share, the market share of some competitor(s) must go down. Kirin Asahi Sapporo Suntory (Figures in ¥ mil) (Figures in ¥ mil) (Figures in ¥ mil) (Figures in ¥ mil) 35841 6119 4006 4865 1355787 730800 492628 796445 1205260 1167200 562849 1006224 493064 270967 124315 220507
