It is Narrow-minded approach to a marketing situation where only short-range goals are consideredorwhere the marketing focuses on only one aspect out of many possible marketing attributes. Because of its shortsightedness, marketing myopia is an inefficient marketing approach. According to TheodoreLevitt company should have a radar view rather than tunnel view to its business and when we talk of UBL it is not at all myopic because it has foot falls not just in breweries industry by products likedistilleries, beer , wines, but hasalso entered into airlines, footwear, fashion, apparels, sports.Company’s brand
isnot new to any one and has showed its presence in every sector it is in.Company has also gone for backward integration and has various collaborations and JV’s with suppliers.
One of the most and well reckoned stepthat UBL has taken in order to reduce the rising cost anddecreasing prodution(Appendix)of raw material barley over the year. Higher prices and short supply of key raw materials like malt, hops and barleycan reduce the profit marginand affect Any price increasein this two commoditieshave a direct bearing in reducing the overall operating margin. Due to priceincrease of barley by over 33% and increase in bottling cost, during FY2008 the net profit marginfell by26%.
In states like Uttar Pradesh, Rajasthan and Madhya Pradeshwhich, account for 80.34% of barleyproduction in India, the area under cultivation is shifting to other crops like sugarcane. As can be seen inthe adjoining diagram, the barley production has declined by over 60% from 3135 KMT to 1220KMTfrom 1975 to 2005. To hedge the risk on rising raw material prices, UBL has entered into long termarrangements for sourcing of the vital inputs. In addition it has extended its own contract farminginitiatives in the state of Punjab. The 51% Equity stake in Maltex Malsters Limited, a manufacturer of malt, is also an initiative for vertical integration.
The Indian beer industry has been witnessing steady growth of 10 -17% per year over the last ten years.The rate of growth has increased in recent years, with volumes passing 170m cases during the 2008-2009 financial year. With the average age of the population on the decrease and income levels on theincrease, the popularity of beer in the country continues to rise.In modern times, beerbegan to be exported to Indiain the early days of the BritishEmpire—the early 1700s. The first modern brewery in India was set up in Kasauli, in the Himalayamountains, near Shimla, in the late 1820s by the Englishman Edward Dyer . The Indian beer industry haswitnessed a big change during the last five years. The industry was previously dominated by competitionbetween the Vijay Mallya-controlled United BreweriesGroup and the Manu Chabbria-controlled ShawWallace. The scenario changed, however, with the entry of SABMillerin India. The international beergiant started by acquiring small breweries in the south but then completely changed the landscape with