The Competitive Strategies of Beer Industry in Taiwan: An Application of Game Theory

• Main Authors: Chia-i Huang, 黃嘉怡
• Other Authors: Alex K. H. Chang
• Format: Others
• Language: zh-TW
• Published: 2007
• Online Access: http://ndltd.ncl.edu.tw/handle/07652766290775188069

碩士 === 國立屏東科技大學 === 企業管理系所 === 95 === Taiwan market consumes around five million hectoliters of beer per year. Eighty percent of them are “Taiwan Beer” produced by Taiwan Tobacco and Liquor Corp.(TTL). The other 20 percent are shared among “Tsingtao Beer” of Taiwan Tsing Beer Corp. and other imported beer brands. However, TTL’s 4 beer breweries have a total annual production capacity of six and half million hectoliters, and the Longquan beer brewery of Taiwan Tsing Beer Corp. has an annual output of one million hectoliters. The combined output obviously far exceeds market demand, and severe competition of beer market is expected. There are many studies on Taiwan beer industry in the past, but few analyze the competitive strategies and behaviors based on the Game Theory. This thesis will use Game Theory as the major analytical tool to look into the strategies taken by major beer manufacturers in a dynamic and highly competitive market. This thesis conducts case studies on Game Theory to interpret the status of each competitor. The Ice Cream Selling Model will be used to explain the maneuvers of each beer brand prior to the era of monopoly. The Entry and Deterring Strategies will be applied to explain the end of monopoly and the lifting of the government’s ban on private beer breweries. Rasmusen’s Product Quality Game Theory and the Overlapping Generation Model of Markov Equilibrium and Customer Switching Model are applied to study how the quality of beer and the cost of customer switching affect the industry as well as each player’s strategies. At the end of the thesis, based on the results from the above analysis, an individual company’s decision making pattern will be examined, and the conclusions and implications will be provided for the decision makers’ reference.