SAN MIGUEL

CORPORATION
Araling Panlipunan 10 Submitted by Dirk Mathew Gatdula The Master's School
 introduction
With revenues equaling nearly 4% of the Philippines' GDP in 2020, San Miguel Corporation (SMC) is one of the region's most
extensive and diverse corporations. SMC was first established in the Philippines in 1890 as a single-product brewery. Today, SMC
has highly integrated operations with ownership in market-leading companies and investments in various industries, including
beverages, food, packaging, energy, fuel, and oil, infrastructure, property development and leasing, cement, car distribution, and
banking services. SMC has a variety of businesses that are integrated into the Filipino economy and benefit from and advance the
country's development and economy.

San Miguel Corporation 2023

 OLIGOPOLY
Beer is the most consumed drink in the Philippines and sums up a 70% portion of the domestic alcoholic beverages in the market in
footings of volume. The Philippine Liqour Industry is oligopolistic in nature. SMC Beer products compete in the premium,
popular/mainstream, and economy market segments in the Philippines. The popular/mainstream segment continues to be the key
driver but the share of the premium or upscale brands has been increasing since 2000.

San Miguel Corporation 2023

 STRENGTHS

SMC has focused its resources on industries it considers to be attractive growth areas that are
consistent with the expansion and growth of the Filipino economy since implementing its
business diversification policy in 2007. In order to achieve a more diverse mix of sales and
operating income, SMC believes that continuing this strategy and pursuing growth plans
within each business will be beneficial. This will also put SMC in a better position to access
capital, present various growth opportunities, and lessen the effects of downturns and
business cycles.

San Miguel Corporation 2023

 WEAKNESSES

There is always the risk of other companies that produce the same product or service. This is
considered a weakness because the market’s demand changes drastically, especially if they
find the competitor’s product to have better quality. According to the information in the
Reinventing the San Miguel Corporation case study (2018), SMC can still not fully utilize
technology in its front-end procedures, despite incorporating it into its back-end operations.
This could greatly affect their production. This can lead to poor public relations, customer
backlash, and loss of potential partnerships in other countries.

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 OPPORTUNITIES

Considering how large SMC is in Asia, they are in an excellent position to seize such chances and
increase their market share. Growth in the overseas market can also allow SMC to diversify the risk
since it will be less reliant on the home market for revenue, say Roberto Galang and Andrew Delios.
Another opportunity that the corporation has is its use of advanced technology. The e-commerce
business strategy can assist SMC in forming partnerships with regional vendors and logistics
service providers in the global market. Growth in social media can assist SMC in lowering the cost
of entering a new market and reaching clients with a much smaller marketing spend.

San Miguel Corporation 2023

 THREATS

Related to the corporation’s weakness stated above, there is a threat to the target market’s
change in preferences. In order to make their brand and products more appealing, companies
must take into account the preferences of their target market. There is also the case rising of
prices in the market due to inflation. SMC works in a sector where there is a tradition of high
prices. Roberto Galang, Andrew Delios, and the Rethinking the San Miguel Corporation case
study claim that this may prevent the company from raising prices to the level that its
premium prices merit.

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 CONCLUSION
SMC has a portfolio of businesses that are integrated into the Philippine economy and benefit from and contribute to the country's growth
and economic advancement. With an extensive portfolio of goods, including beer, spirits, non-alcoholic beverages, poultry, animal feeds,
flour, fresh and processed meats, dairy products, coffee, various packaging products, and a full range of refined petroleum products, SMC
has established itself as a market leader in its businesses in the Philippines. The majority of these goods are market leaders in their
respective categories. Additionally, SMC supports a network of hundreds of independent suppliers and advances downstream businesses.

San Miguel Corporation 2023