Craft beer brand jump-starts China growth with new investors
A German craft beer brand was struggling to accelerate their growth in China after entering the Chinese market two years earlier.
The Chinese beer market is highly saturated with increasing competition joining each year. In order to further expand, the company turned to ARC Consulting to identify a strategic funding partner and facilitate the transition.
China has one the of world’s largest beer markets with high growth in the craft beer segment.
The beer industry in China is also going through a widespread consolidation process dominated by a few market leaders. As a result, profit margin in the craft beer segment is narrowing, and market share growth is becoming increasingly challenging.
The client has successfully built their presence in China with a deep focus on channel sales development and digital presence.
The client brought AP on board to expedite the expansion by identifying a new strategic partner and helping to ensure a successful deal.
The project was rolled out in four steps:
The team started by establishing a market overview of all the relevant categories that could yield potential investors/partners.
Then, the team outlined in each category the main targeted companies and their contact details.
Based on the master list created and shared with the client, ARC Consulting jointly formulated target strategies for each of the categories, introducing the benefits of the partnership and the potential structure for the partnership in China.
After a detailed selection process and weekly updates to the client, meetings were scheduled with three strategic investors. The client was accompanied by ARC Consulting to support and assist in the negotiations during these meetings.
ARC Consulting advised the client throughout the project cycle. Recommendations were provided based on potential investors’ feedback.
The client had a better understanding of the main types of investors active in the market, their preferences when choosing target companies, and the commercial attributes they are seeking.
The client achieved substantial organic growth with the new partner’s involvement. New funding support further increased the company’s footprint and brand recognition in the Chinese market.