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Source: CT 1 – Události
Date: August 26, 2002
Title: Sale of Czech Beer Behind Belgian Beer Jupiler
Journalist:
Text:
Bohumil KLEPETKO, moderator
The Belgian police have arrested one person and confiscated four hundred
fifty-litre kegs of Czech beer which resellers were masquerading as Belgian beer. The beer
concerned is Ferdinand, brewed in the Czech town of Benesov, and was selling in Brussels
based pubs, restaurants and coffee shops under the trademark of Jupiler. Investigators
determined that the resellers were selling the Czech beer in this fashion for at least the
last two months. The management of the Benesov brewery declined to comment on the
situation. Our journalist Jiri Frantisek Potuznik is on site in Belgiam and questioning
the local police.
Jiří František POTUŽNÍK, journalist
The Belgian police confiscated towards twenty thousand litres of Czech beer
Ferdinand in the Brussels quarter of Haren which were earmarked for relabelling to Belgian
beer Juliper. Resellers were apparently importing towards four hundred fifty-litre kegs
per week for at least the past two months.
Yves BARBIEUX, journalist for Het Nieuwsblad
They bought these kegs in Belgian restaurants and filled them in the Czech
Republic with light beer.
Jiří František POTUŽNÍK, journalist
In all probability, the Czech beer was transported to Belgian via transport
vehicles and the smugglers only needed to make it across the German border.
Yves BARBIEUX, journalist for Het Nieuwsblad
There’s no more borders to worry about once you make it into Schengen.
Jiří František POTUŽNÍK, journalist
According to some eye witnesses, a small group of blacks were emptying the
contents of the trucks by hand at night. The police are determining whether the gang is
part of a larger network of resellers and are trying to determine whether only the
supplier knew of illegal trade in the Czech Republic or whether the brewery knew about it
as well. They are also investigating whether any of the restaurants and coffee shops knew
about the scandal. It seems that as much as four thousand kegs might have illegally poured
out the taps of the Belgian metropolis. One fifty litre keg of light beer, costing about
one thousand crowns in the Czech Republic, would have been sold by three times this value
in Belgium under the name of Jupiler.
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Source: CTK
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Source: Týden
Date: September 23, 2002
Title: Price of Beer Here is Too Low
Journalist: Michal Uryc-Gazda
Text:
Only in Czech and Japan do local brands have the best reputation. Tony Desmet at the helm
of Czech’s number two brewery concern – Prague Breweries. Defending the
controversial Staropramen commercials and not too keen on the low price of Czech beer.
Beer camps, boys keep together… do you not think that the Staropramen ads
degrade Czechs to a bunch of brainless drinkers? Would you use such commercials in
Belgium?
In Belgium, one of the most popular beers on the market uses the "male
beer" commercial, which is targeted exclusively for the male population. Or in other
words, I have two daughters aged 25 and 27. Neither of them live here, but when I showed
them the ad, both of them said it was perfect. The ad was masterminded by a Czech
advertising agency.
Mark/BBDO?
Yes. I have seen a lot of commercials made by beer brewers all over the world and
ours certainly is not the most mundane. You don’t believe me? Okay, here’s one:
one male was complaining to another that his wife chewed him out because he forgot to go
shopping. But everything ends happily once both of them sit down for a glass of beer.
Maybe good taste is not suitable for beer commercials.
These beer camp commercials have earned back a bit of credit to Staropramen. Even
those who don’t drink this beer have praised its commercials as funny. You would be
surprised to learn how many people have started to take this beer seriously. And
you’d also be surprised to learn that these advertisements are ranked as the best
among the viewing audience.
Why is Prague Breweries still wallowing in losses? Was it due to poor management by
its previous owner – Bass?
I do not want to compare the brewery’s present management with the previous
one. It was a different situation at that time. We must also be aware that the lowest beer
prices in Europe can be found here in Czech. In a bar, the price of mineral water costs
more than beer, which is rather unusual. Furthermore, Bass put combined three breweries:
Branik, Smichov and Ostravar.
That is a weak argument.
There is still one more thing. Around 1997, Bass wanted to invest a substantial
amount into the brewery, but this was prevented. It was under complex negotiations with
its minority shareholders: the National Property Fund and other investment funds. We
managed to come to an agreement with them and we ended up buying out their shares for not
a crown more than their market values.
So now you control pretty well 100% of the shares?
To be exact, ninety seven percent. This enabled us to put a stop to several legal
disputes which Bass was waging against minority shareholders. Then we started focusing on
the causes of the losses, investing and still planning to invest hundreds of millions of
crowns into better equipment. Now all we need to do is focus on our portfolio of beers.
How should your profits look this year?
Looking at the first six months of the year, it seems that we should end in the
black. However, we are suffering from losses incurred by the flooding, which should run at
about one hundred and fifty million CZK.
But didn’t the brewery make a lot more money?
There are two ways how one can make money in the beer brewing industry: one is to
have more than one premium brand; the other is to export. Prices on international markets
are usually several times higher than Czech prices. Furthermore, an exported brand carries
with it a better image.
But this does not apply here.
You are correct. The second exception to this rule is Japan, where beers such as
Carlsberg or Stella Artois do not stand a chance against the reputation of domestic beers
there. The same is the case here.
But Guinness and Carlsberg do have a good reputation.
The group of consumers trying out foreign beers drink about fifty thousand
hectolitres of such beer annually, for which reason it does not make much sense to
concentrate on them.
Do you pay the large retail chains to have your beers in the "first isle"?
No. Our consumers will find our beer and the competition depends on price. And
because the prices are so low, not much remains for promotion. For example, in France,
breweries pay for special racks. There are not enough funds for that here.
However, breweries seemed to have scraped together enough money to pay out hundreds
of thousands of crowns to furnish pubs.
That depends on the circumstances. We provide to many restaurants. Sometimes an
owner is only interested in our beer, other times also in tap equipment, and sometimes in
cash for new furnishings in their pub, which can cost as much as two hundred thousand
crowns. But offering this to them requires that they dispense our beers over a period of
let’s say five years. I should mention though that our beer is also served in pubs
into which we did not have to invest one heller.
Some pubs are buying your beer under the table so as to avoid taxes. Apparently
someone within your organisation had betrayed these breweries, who were reprimanded for
it.
This is not the case at all. The entire order is always written on our invoices.
If a pub shows a different invoice to the financial authorities, it is out of our control.
Do you agree with tax benefits to small breweries?
I don’t have any problem with this. This can represent the only single way
how a small brewery can survive, and it is quite apparent that this is truly the case for
most domestic breweries. The problem would be if breweries of the same size would have
different tax breaks.
***
Tony Desmet (53)
General manager and executive board director of Prague Breweries. He graduated from
the prestigious Catholic University in Leuven of Belgium. When he started working at the
Belgian brewery concern of Interbrew fourteen years ago, the company was the twentieth
largest brewery concern in the world. Now it holds a third place position. With its
fourteen percent control of the Czech market, the company maintains a second position
here. Desmet worked for Interbrew in different countries around the world, such as in
South Korea. In December of 2000, he started working at Prague Breweries, which Interbrew
acquired from Bass. He did not throw out anyone, and senator and lobbyist Josef Zieleniec
remained on the company’s board of directors. Desmet is convinced that the days of
foreign managers working in Czech companies is slowly coming to an end.
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Source: CTK
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Source: CTK
Date: November 4, 2002
Title: The EU Ended Cartel Investigations of Carlsberg and Heineken
without Result
Journalist: hp
Text:
The European commission concluded without results its investigations concerning its
suspicions of cartel agreements made between Danish brewery Carlsberg and Dutch brewery
group Heineken. The executive arm of the EU today announced that it had not found evidence
proving that an agreement had been made between the two companies dating back as far as
1995. The commission blamed both brewery concerns of coming to an agreement between each
other and stipulating that they will not try to penetrate each others markets, an
agreement which was allegedly to apply between the years of 1993 and 1996. But the
commission could not find evidence to such an agreement after May of 1995. EU rules give
the commission power to impose fines on companies found guilty of signing cartel
agreements and which they were proven to have fulfilled to the latest five years prior to
commencement of the investigations. In this case, the investigations had started in the
year 2000. Both of the companies sent statements to the commission denying any agreements
made concerning division of the market or any other form of cooperation. In August, the
commission stormed the companies’ headquarters, but did not manage to find any
evidence of such agreements following 1995.
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Source: CTK
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Source: CTK
Date: November 25, 2002
Title: Le Soir Concerning Expansion of the EU: Belgians and Czechs
Share a Passion for Beer
Journalist: sd
Text:
Czechs and Belgians share a common passion: beer. So reported today the journal Le
Soir on its series concerning the characteristics of future state members. The journal
commented that Belgians drink on average 90 litres of beer a year, where Czechs drink 160
litres. "Here everyone drinks beer," says Ivan Slechta from Prague Breweries.
"Even children try beer there," added the paper. Le Soir stated that the Belgian
brewery of Interbrew began operating in the Czech Republic before waiting for any
expansion. "The aim is to penetrate markets which were up until now the exclusive
domain of Pilsner: a light beer based on fermentation originating, as the type of beer
implies, in Plzen," writes the paper. Starting the beginning of last year, Interbrew
has had the final say in Prague Breweries. Le Soir also commented about Bernard beer, from
the family owned brewery of Stanislav Bernard and which is supplied to the Czech
Parliament, saying that Czech politicians are not distinguished by whether they are left
or right but rather by whether or not they are beer drinkers. A proof of this is the
popular Pivrncova pub decorated with comic cartoons from Petr Urban. Czech politicians
often like posing with a glass of beer, as a means to presenting themselves as closer to
the people. This also applies for the former premier of Vaclav Klaus and for the existing
president of Vaclav Havel, so writes the journal, and touched on the inclinations to
alcohol of the former parliamentary speaker, Milos Zeman.
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Source: Lidové Noviny
Date: November 26, 2002
Title: Czechs are Faithful to their Own Beer and are not Interested
in Foreign Beers
Journalist: Zuzana Picková
Text:
LUNCH WITH LIDOVE NOVINY
LUNCH WITH... Tony van Kralingen – General Manager of Pilsner Prazdroj
When the South Africans acquired Pilsner Prazdroj, Czech beer drinkers were
banging their breasts. After all, no one else knows how to brew beer than us. Tony van
Kralingen started running the brewery in the year 2000 and his comrades back home feared
it is not possible to do business in post-communist Eastern Europe.
This the present director of Pilsner Prazdroj comes from the province of Natal in South
Africa, a region where he started his career as a businessman, after attaining a degree in
psychology. "I wanted to become a psychologist and I was interested in how people
think and how the mind works," justifies Kralingen concerning his rare educational
background for business. "But I gradually came to realise that it wasn’t the
right area for me and I started to focus on business." Kralingen’s first job was
in a brewery. "I was fascinated by beer and it is a very popular drink among the
younger population. I used to work in a restaurant as a student, so this relationship was
there as well," he continues while seated in the Pilsner brewery’s restaurant,
Na Spilce. He attained his first experience as a "trainee", which is a special
position for fresh graduates. Trainees are able to work in different branches within a
company – from marketing to finance. In the end, marketing was what captivated
Kralingen the most and it didn’t take long before he became the director of four
smaller breweries. He later worked in marketing at SAB (South African Breweries), which in
2000 acquired Pilsner Prazdroj. In 1997 the question was put forward at SAB whether or not
it should become a global brewery concern. "The question arose as to which brands we
should have, if we indeed wanted to become a global player. That is why from 1997 we
started studying the behaviour of consumers on all continents and in 19 countries –
both developed and less developed. We were primarily interested in their relation to
premium brands." In July of 1998 Pilsner Urquell showed up on the list of interesting
brands, and we gained control of it within eighteen months. It goes without saying that
speculation developed in Czech as to whether the South Africans are capable of
"running something as traditional as Prazdroj" and whether they will remain in
the company over a longer period. "In South Africa we control a majority of the
market and we make more money there than here, because there the market consumes 23
million hl. of beer annually and here only 16 million. Also, there you will find
everything you need," says Kralingen, adding that in South Africa similar food and
drink is consumed as is in Europe. "From the beginning we tried to convinced Czech
consumers and our own employees that we are aware of the tradition that Prazdroj bears,
that we realise the jewel we have acquired and that we must take care of it. My task is to
make sure that this will be sustained and I believe I have been successful at it,"
evaluates Kralingen.
I Did not Feel I Needed an Education in Economics
Considering the fact that Kralingen studied psychology, I was curious whether he
lacked an education in economics. "Business is about people. If you can understand
them, your job is made easier. I never felt a lack of economic education, even though I
actually considered attaining an MBA. You can learn about numbers as you go. I had to
resolve many problems during my career, and this is the best form of education of all.
When problem solving, you learn about issues comprehensively, which is better than
learning about things in theory." Kralingen adds that, in industry, there are many
common principles which can be applied anywhere, be it in the beer brewing industry or in
telecommunications. "Much depends on whether you are able to convince someone to buy
your product. You must have an open mind, understand your customer, and prove to them your
knowledge and experience – this is in fact a psychological element." Besides
attaining good economic results, Kralingen’s goal for Prazdroj is to convince the
young to go and work for him. "Everyone, in particular young people, would like to be
associated with success. We would like to offer young people perspective and a career
within an international environment. I hope that they may find the opportunity to learn
much and to try out different things. Above all, I want all my employees to get up in the
morning and not dread having to go to work, but rather that they look forward to working.
Czechs are a nation of beer drinkers and are very fixed on their own, traditional beers.
What interests me is what this may represent for a company like SAB. "We consider
Pilsner Urquell as a premium brand and we value it greatly. Gambrinus is sold the most
here and from which our marketing is built on. Gambrinus is a beer you drink when in
larger numbers – when you are together with your friends. On the other hand, Radegast
and Kozel are regional beers." The point is that Czechs are often very faithful to
their local beer, such as Moravians are to Radegast. SAB does not plan to acquire any more
breweries in the Czech Republic and are satisfied enough with Radegast, Kozel, Prazdroj
and Gambrinus. "The merger was approved last year in September and now we must work
towards a unified company culture and adopt many changes which will lead to the creation
of a uniform brewery group. Just think of how Radegast used to compete against Gambrinus,
but now these are brands which belong in a single company’s portfolio. They can no
longer complete against one another." In all confidence, Kralingen declares that he
wants Prazdroj to become the most-liked company in the Czech Republic. So far Skoda has
maintained that position. "We want to become a company of reference, meaning a place
where others will frequent and watch how we do business." Kralingen also mentioned
that he expect further increases in the sales of "his" beer, so I was interested
in determining how he planned to accomplish this: he explained by an "increase in
market share", explaining it as follows. "First of all, we must provide a
quality service, because consumption of beer here will no longer increase. We must have
the best facilities and make sure that all our deliveries of beer is perfectly timed. It
is a different matter to supply the hypermarket from supplying the little store on the
corner, where a lot of people may frequent in the afternoon, meaning that you must supply
the shop in the morning. Satisfied customers always translate into profits for us."
We Will Not Focus on Women
I asked Kralingen whether he planned for sales of other beers of SAB on the Czech
market, considering that beer drinkers are so conservative here. "We are not planning
for this. We will not try to attempt something which customers essentially do not
want." Not even flavoured beer? "We have such beers in our own portfolio, but we
will not introduce them on the market in that there is simply no demand for it here,"
concludes Kralingen. Prazdroj’s competition addressed the female consumer, which is
why it interested me if Prazdroj was going to do something of the similar. "Probably
not. Women consume a maximum of 40 litres per year, which is much less than men do. We do
not expect any increase in this figure, even though beer is a rather healthy drink. So we
resign to the fact that beer is primarily a male’s drink, drunk mostly in the pub,
and our policies reflect this." What is your relationship to beer? "I prefer
most Pilsner Urquell. I knew it even before I came here. It is an unforgettable product
and I like to have it with my beer, depending on the occasion." Kralingen admits that
he does not visit only luxurious establishments but that he tries to drink his beer where
the most customers are. He drinks about four beers a day, but always according to the
occasion. The calories he intakes from beer he tries to jog off, and he likes to play
tennis or even golf. Besides Czech beer, Kralingen also likes Czech cuisine, which is
testified by the fact that he ordered beer and brewery goulash for his lunch in Plzen.
***
Tony van Kralingen declined an invite by Lidovy Noviny but rather insisted on inviting the
journalist himself to the Na Spilce restaurant, which belongs to Prazdroj. He ordered pate
(liverwurst) with salad as an appetiser and brewery goulash with dumplings as the main
meal, drinking this down with, inevitably, Pilsner Urquell.
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Source: CTK
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Source: CTK
Date: November 26, 2002
Title: Owner of Prague Breweries Strengthening its Position in
Germany
Journalist: irl
Text:
Interbrew, the third largest brewery concern in the world, is continuing its expansion
into Germany with the planned acquisition of Brauergilde Hannover. The Belgian company
today managed to overcome the greatest barrier to the acquisition when it obtained
approval to the acquisition from one of the company’s shareholders, the city of
Hannover, as was reported in a statement made public by the company today. The city
maintains a ten percent share in Brauergilde, which is the parent company of Gilde
Brauerei, the fifth largest brewery concern in Germany and one of whose beers is
Hosseroder. Two weeks ago, Interbrew made a 523 million Euro offer for Brauergilde and now
plans to use the acquisition to strengthen its position on the fragmented German beer
market. Brauergilde shareholders offered more than 50% of shares up for sale, but the
city’s share was not included. Originally, the city planned to appeal against the
German company in the courts because it apparently did not gain enough votes from
shareholders for the company’s sale. Interbrew won out in the tender process above
its main rivals, Heineken and SAB Miller. In Germany, the Belgian company also owns
Beck’s and Diebels, which it had acquired more than a year ago, so reported Reuters.
Interbrew operates in 20 countries and supplies its beers to more than 120 countries. It
is made up of 65 breweries worldwide and was founded in 1987. Since 1991 it made more than
33 acquisitions or mergers. Interbrew is the majority shareholder of Prague Breweries.
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