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Five Forces Bottled Water

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1. History

Australian Beverages Limited (ABL), formerly known as Australian Soft Drinks Limited, commenced

operations in 1937. The antecedent company was established by a group of enterprising pharmacists who

had previously made carbonated soft drinks in their pharmacies which were then offered for sale in sealed

bottles. The first manufacturing plant opened in Sydney in 1938. Business began slowly, but the arrival of

American soldiers in Australia in 1942 had a significant impact on both sales and market acceptance of

carbonated soft drinks. Australian Soft Drinks initiated its move into non-carbonated soft drink beverages in

1984 when it began manufacturing fruit drinks. This followed the acquisition of a fruit juice manufacturer in

Victoria. The fruit drinks' business expanded nationally over the next 10 years. In 1990, Australian Soft

Drinks entered the milk drink market with the purchase of manufacturing facilities from a dairy co-operative.

The company officially changed its name to Australian Beverages Limited upon listing on the Australian

Stock Exchange (ASX) in 1996, to reflect the broader beverage base of the business.

In the years since its ASX listing ABL has adopted a multi-beverage strategy wherein its product range has

been expanded to cover all categories of the non-alcoholic beverage market. However, bottled water remains

outside this product range. The company has also moved into the manufacture and distribution of snack food

products through its acquisition of several small businesses in 2004. It aims to strengthen distribution

relationships with the convenience stores and hospitality channels. These developments have resulted in

ABL's revenue composition to change from 90 per cent CSD-based in 1997 to 68 per cent CSD-based

in 2006. The aim is to further reduce dependence on CSDs by 2012. It intends to increase its market share of

non-CSD beverage products so that CSDs will represent less than 50 per cent of company revenue as part of

its multi-beverage strategy.

2. Business strategy

ABL's vision is 'To satisfy Australia's thirst by being a manufacturer of non-alcoholic beverages for every occasion in every location'.

The company aims to achieve this vision by pursuing the following strategic goals for the 2007 to 2012 period:

_ offer a wide range of products in the non-alcoholic



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