The tobacco industry is a multi-billion-dollar industry and is dominated by a handful of companies. The five leading tobacco companies of the world are China National Tobacco, Philip Morris International, British American Tobacco, Imperial Tobacco and Japan Tobacco. The combined profits of these companies are equivalent to the combined profits of Microsoft, Coca-Cola and McDonalds. These companies produce more than 6 trillion cigarettes each year and the global sale of cigarettes has increased by more than 8% between 2000 and 2014. The tobacco industry generated revenues of US$744 billion in 2014 as noted by (Cheatsheet, 2015).
According to (Smith, 2015), British American Tobacco has been so successful along with few other tobacco companies …show more content…
The four main plans behind the success of BAT and to achieve its vision are based on growth, productivity, responsibility and building winning organisation. The policies for the growth of BAT is to enter new emerging international markets through mergers and acquisitions. Similarly, BAT focuses on the organic growth of tobaccos which will establish it as a premium brand in the long run. It wants to enter the ‘Global Drive Brand’ category where it can expand in the field of ‘value for money’ and ‘low price segments’. BAT focuses on direct store sales of its products with which it can establish a profitable and long-term relationship with its potential customers. The production strategy is based mainly on using its available international assets to increase earnings and gather furthermore capital for investing in the company again. It reduces cost through reducing its supply chain, whereas it continuously improves its product quality by developing its workforce and capital effectively. One example of such is the closure of manufacturing plant in Southampton in 2005 to reduce the incurring costs and supply chain problems (British American Tobacco,
According to (Smith, 2015), British American Tobacco has been so successful along with few other tobacco companies …show more content…
The four main plans behind the success of BAT and to achieve its vision are based on growth, productivity, responsibility and building winning organisation. The policies for the growth of BAT is to enter new emerging international markets through mergers and acquisitions. Similarly, BAT focuses on the organic growth of tobaccos which will establish it as a premium brand in the long run. It wants to enter the ‘Global Drive Brand’ category where it can expand in the field of ‘value for money’ and ‘low price segments’. BAT focuses on direct store sales of its products with which it can establish a profitable and long-term relationship with its potential customers. The production strategy is based mainly on using its available international assets to increase earnings and gather furthermore capital for investing in the company again. It reduces cost through reducing its supply chain, whereas it continuously improves its product quality by developing its workforce and capital effectively. One example of such is the closure of manufacturing plant in Southampton in 2005 to reduce the incurring costs and supply chain problems (British American Tobacco,