Digital transformation and merger integration lift consulting bill of Heineken

30 March 2018 Authored by Consultancy.uk

Heineken ramped up its central consulting spending by more than 20% in 2017, according to its latest financial statements. The firm has been seeking to reposition itself, as its competitors strengthened their arms via acquisition campaigns, as well as pushing for a digital transformation agenda to consolidate profits in the long-term.  

Consultants involved with Heineken will be toasting the beer-brewing giant, after news emerged of a bumper year in consulting fees paid out by the company. Heineken has consistently sought the advice of the consulting sector amid a changing market, with advisory specialists aiding the firm in matters including the succession planning of what is still considered a ‘family business’, and a rejected takeover bid from SAB-Miller in 2014.

Heineken is the Dutch market leader in the beer industry, and remains one of the top three largest breweries in Europe, as well as a major exporter to the United States. However, after Britain’s high-ranking London-listed SAB-Miller, was the subject of a mega-deal merging two of beer’s Big Four – being purchased by Belgian brewing conglomerate Ab-InBev – Heineken has been keen to expand its own capacity, against heightened competition.

Consulting spend of Heineken (€ / million)

In order to do this, the famous brewery has upped its annual consulting spend to its highest rate since 2014, in a 21% boost on last year’s advisory bill. According to the company’s latest financial statements, Heineken spent €169 million on consulting industry expertise in 2017 – mainly for pushing its digital transformation agenda and for integration work following acquisitions of brewing company Lagunitas, Japanese brewery Kirin, and the Punch Taverns pub portfolio, among others.

The €169 million total averages out at the rough equivalent of €2,100 per employee being spent on consulting services. The current level of expenditure is comparable with 2011 and 2013 when €166 million was spent on advisory services – a bill with similar motives behind it, as Heineken spent a large sum on consultants when it took over Asia Pacific Breweries.

The climb in consulting spend is emphasised further as it comes on the back of a two year reduction in spending on external expertise at the group. Heineken’s consulting bill fell by the same margin that it has climbed this year, back in 2015. It spent a further 1% less last year, with €140 million being paid to management and technology consultancies, as well as independent consultants in 2016.

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