AB InBev is further scaling down its business in Germany. According to information which was first revealed by inside.getraenke two weeks ago and which were now confirmed, many jobs at AB InBev’s German headoffice in Bremen will be cut.
Initially about 60 jobs were threatened, now it is apparently only around half. Twenty of the thirty people employed in AB InBev’s Customer Service Center will apparently lose their jobs. Some of these activities are to be relocated to countries with lower wages, namely Hungary.
The so-called event service no longer seems to be affected. This work area bundles the support of larger events - a business that has come to a complete standstill due to the Corona crisis. Against this background, AB Inbev planned to cut around 25 jobs, but in previous talks with employee representatives and the trade union the company could be convinced to assign the employees concerned to other work areas for the time being.
The Bremen workforce has been confronted with the outsourcing of administrative processes for several years. Standard activities such as financial accounting and payroll accounting have been outsourced from Bremen to the group's own “Shared Service Center”, some of which are located in Eastern Europe.
Since entering the German market with the overpriced purchase of the Beck's brewery in Bremen nearly 20 years ago, AB InBev has unsuccessfully looked for strategies to make the corporate beer palatable to German customers. During this time, 12 managers took a turn at the wheel of AB InBev’s German business unit. The last in line for around a year is 31-year-old Belgian Michel Pepa. (inside.beer, 24.10.2019)
Last year, AB InBev had to admit that the sale of two of its four breweries in Germany had failed because no serious investor was left over to buy Hasseröder Brauerei and Diebels Brauerei which account together for more than two million hectoliters. (inside.beer, 20.3.2019)
In December 2019, AB InBev unexpectedly canceled the launch of its flagship brand Budweiser in Germany due to unresolved problems with its brand name. The world’s leading brewer reportedly planned to spend EUR 10 million on a marketing campaign and had already agreed on listings and promotions with national retailers. People close to the matter said at that time that the way, AB InBev had planned the launch was “amateurish”. (inside.beer, 30.10.2019)
Benoit Bronckart, who took office as Business Unit President - Central Europe at AB InBev in August, will have a hard task to achieve the ambitious financial goals of the headoffice in Leuwen, Belgium. Since growth in a declining beer market like Germany is difficult to achieve and AB InBev's brands have lost their luster over the years, there is not much more to do than cutting costs and lowering the sales price to sell bigger volumes.
So far, AB InBev had only run price promotions for their brands Hasseröder, Fransziskaner and Diebels at the end of each year in order to achieve the volume targets. Beck's as the leading brand was largely spared. This year everything is different here too. Beck's price reductions below the level of the competition are now having the desired effect and are bringing double-digit sales growth in retail.