Business Ethics in

Liquor Industry

Group Members

Sailee
Patil

Utkarsh
Achrekar

Mahesh
Jagdale

Prasad
Tarker

Background
Origin of "liquor" and its close relative "liquid"
was the Latin verb liquere, meaning "to be fluid
Earliest reference to alcohol ( Somras & Sura)
traced to year 2000B.C

INDUSTRY OVERVIEW
Indian Liquor Industry with
market value of INR 8500 Crs.
against INR 900 Crs. in 1999 &
is growing at 12-15% P.A over
last 2 years.
The Indian liquor industry
comprises of
-IMFL, Indian Made Foreign
Liquor, and
-Country Made Liquor
IMFLs total business in market
INR 6150 Crs.
Country Made Liquors business
INR 2350 Crs.

Background
First Indian brewery set up (1805) in
Kanpur IMFL by Carew & Co.Ltd.
Excise Committee (1905) to control
rise in consumption
Alcohol Advertisement
-Surrogative ads
Industry faced criticism for targeting
young people

Status Of Alcohol Industry In

India
Generates Rs.16,000 crore per annum
Alcohol sales proceeds account for
45%of the total revenue collection in
the country
Whiskey - 60% of the liquor sales
Rum- 17%
brandy- 18%
Vodka - 6%

Status Of Alcohol Industry In

India
Duty on foreign distilleries = 464706%
Domestic industry accounts for 99%
of the market share
Maharashtra, Uttar Pradesh, and
Tamil Nadu have a liberal policy

Major Players And Their

Market Share

Market Size
70 million cases market
Growth rate :- 10-12 % per annum
Major market zone:- South and West
account for bulk (> 75 %) of this market
Major beer consuming centers :Maharashtra (Mumbai),Karnataka
(Bangalore), Tamilnadu (Chennai)

IMFL Categories: Market size (in

%)

Major Brands
Major beer brands (manufacturers)

King Fisher

Kalyani Black Label (UB Group)

Golden Eagle (Mohan Meakins)

Haywards (Shaw Wallace)

London Pilsner(Associated Breweries

and Distilleries)
Foreign brands

Strohs

Fosters

Company

Market Size (mn

cases)

Brands

Herbertsons

Bagpiper

McDowell & Co.

17

McDowell no.1,
Diplomat

Shaw Wallace

Directors Special

UDV

Over3

Green Label, Smirn Off

Bacardi

0.1

Bacardi Rum

Seagram

0.8

Royal Stag

Other Players
Ace Continental Exports - Manufacturer of beer
Amrut Distilleries - Supplier of dark rum, brandy
and whisky
Champagne Indage - Producers of still &
sparkling wine
Chateau Indage - Sparkling wines manufacturer
Cobra - Beer manufacturer
Dajeeba Vineyards - Red and white wine
manufacturer
Kem Liquors - Rum and brandy bottling services

Contin..
Liquors India - Manufacturer of liquor
ND Wines - Red, white and appetizer wines producer
Radico Khaitan, Rampur - Liquor manufacturer
Shaw Wallace - Producers of spirits and beer
United Breweries - Kingfisher - A leading brand of
Indian beer from the UB group
Vinbros & Co - Manufacturer of whisky, vodka,
brandy, rum & gin

Ethical And Unethical Ways

Of Business Conduct In
Liquor Industry

Ethical Ways Can Be:Writing on the bottles that liquor is

harmful for health.
Sometimes it is important to use in
medical purpose.
Sponsorship of sports, social and
cultural events that is surrogate
advertising.
Uniform Federal Excise Policy
Strategic tie up with global players

Unethical Ways Can Be: On one hand, govt. says, put a label
saying liquor is harmful to health" to
people on the other side of the fence it
may sound unethical but to
manufacturers or brand owners it is a
necessity because any business which
is allowed under the law has a right to
advertise and market their product.
By denying them that right, we are
transgressing the law.

Unethical practices in LIQOUR

Industry
Unauthorized stocking of Liquor
Not acquired appropriate licenses for the sale of liquor
Sale of liquor on dry days
Surrogate advertising to mislead the common man
Selling liquor to minors over the counter at wine shops
No stringent standards maintained at the time of

manufacturing liquor
Selling of expired stock to addicted people at cheaper

rates
Sale of unauthorized liquor (desi ,khamba ,tharra)

RESTRICTIONS ON LIQUOR CONSUMPTION

(1)Legal Drinking Age
(2)Drunk Driving Law
(3)Advertisements
(4)Dry Days
(5)Dry Days by State

CHALLENGES
High taxation
State wise regulations
Social taboo
Consequences of men often
spending large portions of
their meager daily wages on
liquor while their families go
without food & shelter
Support to the prohibition of
alcohol by some womens
social groups

CHALLENGES
Ban on advertising
Counterfeit
Point of sales and unorganized
retail
Aggressive official anti-alcohol
abuse initiative through
advertisements & campaigns

ADVANTAGES OF BEER
Source of vitamins, minerals and
flavonoids
Coronary heart disease (CHD)
Cholesterol
X-Rays radioprotection
Cheaper

DISADVANTAGES OF BEER

Beer belly
Heartburn
Blood pressure.
Intoxication & Dehydration
Impairment of drivingrelated skills

Case Lets
Case 1 Kingfisher Beer
Case 2 Anti-Liquor protest &
Govt.

Case 1 Kingfisher Beer

Kingfisher -solid beer brand in south and west India
which are major areas of beers consumption.
Liquor advertising is banned in print and electronic
media, liquor companies have resorted to surrogate
advertising, which are soon to be banned by govt.
As a result, liquor industries could promote
themselves only through sponsorship of sports
events, contests and fashion shows.
Kingfisher already has stopped surrogate
advertising.
In Kingfisher Derby which is held in Bangalore every
July, kingfisher beer brand is promoted.
also, Mr. Mallaya sponsored Kingfisher Fashion
Awards , presenting Ritu Beris Collection in Paris.

Case 2 Anti-liquor Protest & Govt.

In 1990, the women of Dubagunta, a small village
in the Nellore district of the south Indian state of
Andhra Pradesh began an anti-liquor protest.
They pressurized men to swear that they would
stop drinking, physically restrained habitual
drinkers, attacked liquor shops and godowns and
fought with the police, liquor mafia and the
drunks.
The movement spread like wildfire to 800 villages
throughout the state.
Women in these 800 villages not only prevented
the entry of liquor into their villages, but also
prevented district collectors from holding liquor
shop license auctions.

 Explaining that those women are tortured to

intolerable limits by the abuse and beatings of
drunk husbands and the hunger and poverty in
which their children grow and die, women have
taken up the step.
It was reported that the women were beaten with
rods, sticks, boots and rifle butts by the liquor
contractors' henchmen as well as the police force.
Non-bailable cases were filed against agitators
who were then imprisoned.
There were even reports that many women
activists were raped and murdered.
These events became a matter of national debate
and eventually led to the then Congress
government of Andhra Pradesh announcing a
statewide ban on the sale of liquor from October
1993.

 The AP government lost $ 362 million in annual

revenues after the prohibition. Despite new taxes
on vehicles and consumer goods, the state's
budget deficit rose to $ 242 million.
Prohibition continued in the state till 1997.
In the same year, the new CM Chandrababu
Naidu lifted the ban on liquor, claiming that he
was forced to do so because of the state's
financial problems.
This move met with unprecedented criticism in
the media. Critics claimed that the state could
have easily avoided unnecessary expenditure on
many other fronts, such as salaries and various
subsidies.

Suggestions To Control
And Minimize Or Eliminate
Unethical Behaviors In
Liquor Industry

Unethical Behavior
* Abuse of inmate
* Inappropriate relationships with inmates
* On-duty misconduct
* Off-duty misconduct
* Introduction of contraband

How To Avoid Unethical

Behavior
The Initial Complaint
Confidentiality
Interviewing Witnesses/Obtaining
Documentary Evidence
Polygraph
Photo Lineups
Positive Action
Law and public policy

Thank you..!