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The friendly traveller: Alfred Heineken: 1948 -2002

By Onome Amawhe

Heineken premium beer is the great beer brand that has made its way around the world. The Dutch lager was first brewed by the Heineken family in 1864 when Adriaan Heineken convinced his mother that there would be fewer problems with alcoholism in Holland if the Dutch could be induced to drink beer instead of gin.

Adriaan also felt that because beer brewed in Holland was of such poor quality he saw it as a personal obligation to produce a high quality beer. Adriaan Heineken’s mother bought him an Amsterdam brewery known as De Hooiberg {The Haystack] which had been established almost 300 years before.

 

Alfred Heineken
Alfred Heineken

In 1882, Heineken was only 22 years old when he took control of the De Hooiberg. He achieved so much success within four years that he built a new lager brewery and closed the original facility. His business continued to grow rapidly.  In 1874, he purchased a Rotterdam brewery to add to his operation. Heineken incorporated his company as Heineken Beer Brewing Company in 1873.

New cooling technique

During this time, he had started using a new cooling technique and gained the ability to brew year round at a high and consistent quality level. Heineken was thus one of the first breweries in the world to eliminate the brewers’ traditional dependence on seasonal ice.   Heineken began to export 12 years after the De Hooiberg purchase, with regular shipments to France.

Through Van Munching’s distribution system, Heineken became the dominant beer import in most parts of the United States. While many imports were available only in metropolitan areas or other limited geographical regions, by 1980s, Heineken was available in 70% of the national retail outlets handling alcoholic beverages. The majority of Heineken beer destined for the United States was brewed at the company’s brewery, where special production lines accommodated the varied labelling requirements of the different states.

Heineken beer also became the leading import in Japan, Canada, and Australia. In 1931, the company entered the first of many joint brewing ventures in countries to which it had previously exported.  That year, the Malayan Brewery was formed in Singapore in association with a local partner. This was closely followed by the establishment of a brewery in Indonesia.   Heineken’s entry into Africa dates back to the early 1900s but operational activities would not commence till 1924.

Africa has been a particularly appealing market for Heineken over the years as its presence has seen it increase its stakes in some of its major African investments. With a continent-wide production amounting to 1.6 million hectolitres {2007} Heineken is the second largest beer brand on the African continent with its availability in 51 of the 53 countries in Africa.

Heineken beer found its way into the Nigerian market in 1946 when Heineken Netherlands provided a loan facility for the establishment of the first of the five breweries in Nigeria. Since the founding of the IGANMU HOUSE Nigerian Breweries four other brewing plants {Aba Brewery, 1957; Kaduna Brewery, 1963; Ibadan Brewery, 1982; Enugu Brewery, 2003}, Heineken has been rendering technical and management support to brewing company.

In December 2000, Heineken acquired majority shares in Nigerian breweries converting its $700 Million loan to equity bringing the Dutch brewers stake in Nigerian Breweries from 43.3% to 52.4%.

Extensive investment programme

The convertible loan stock, made open to NB’s shareholders was approved by the Annual General Shareholders Meeting of Nigerian Breweries in June 2000. Heineken’s sole aim of converting its loan to the company to equity was to help finance NB’s extensive investment programme – redesigning of all departments and business processes to meet Heineken’s international standards.

Nigerian Breweries, which focuses on the premium end of the market, with a broad portfolio of international and local brands, produces 5.7 million hectoliters and controls 56% of the Nigerian beer market with its flagship brands Star and Gulder taking the lead in the Nigerian beer market.

The two beer brands are major competitors for the Heineken beer brand in Nigeria. Nevertheless, Heineken stands out as a true global brand representing social standing: a premium beer you drink in  better establishments and hotels. In the late 1940s, Henry Heineken resigned from the executive board of the company, and was appointed delegate member of the company’s supervisory council.

Shortly after, Henry Heineken sold off family stake in the business and sent  his son, Alfred Heineken; the man responsible for Heineken’s global success, to New York to learn about Van Munching’s marketing operations. While in New York, Alfred took advertising and business courses in the evenings and spent his days canvassing New York on foot with Munching’s sales staff. While learning in New York, he wrote his father a partly prophetic letter:

 “I have my mind set on restoring the majority of the shares in Heineken back into the hands of the family. It is not my plan to become very rich but I think that it is a matter of pride that my children should inherit a stake in Heineken, like I did from you and as you did from your own father”. Upon return to Holland in 1948, he secretly bought back his family’s stake in Heineken with borrowed money-acquiring the majority of the shares in the company.

This marked the beginning of a new era in the company’s strategy, setting out onto the world with a clear objective of developing his heritage into a global brand. His flair for marketing was brought to the fore when he designed the famous green Heineken bottle and the logo with the red star and black banner bearing the brand name.

He also came up with the idea to slightly tilt the e’s in the Heineken brand name to make them look smiling and happy. Every single Heineken commercial throughout the world was approved by Mr. Heineken himself and his habit of vetoing most campaign ideas earned him the nickname ‘Dr. No’.

In 1971, Alfred Heineken was appointed Chairman/ Chief Executive.  In the 30-year period that he was at the helm of affairs of the company, he made Heineken beer a household name, turning the local Dutch beer into a billion dollar business. The following year, the company changed its name from Heineken Bierbrouwerij Maatschappij N.V to Heineken N.V. With the reputation of being one of the wealthiest men in the world, Alfred Heineken remained down to earth.

If he was not in the office, he could be found in the old café Hoppe in the centre of Amsterdam sipping Heineken. One day while on vacation in Jamaica, he was strolling by the seaside and was surprised to see a number of beer bottles littering the beach.

Environmental pollution

As a result, he envisioned a “world beer bottle’ which would be imported for drinking and then kept for construction. He believed the square shaped “world beer bottle’ could be used as brick to help solve environmental pollution and housing shortages in developing countries.

The Heineken management disagreed and rejected the ‘world beer bottle’ idea. In 1983, the beer magnate and his chauffeur were kidnapped and chained to concrete cells for three weeks before Dutch police freed them. A ransom said to be more than $10 million dollars was paid. Afterwards, Mr. Heineken became protective of private life.

In 1989, he relinquished control of the brewing company but continued to play a role in its running. Alfred Heineken was born in Amsterdam on November 4th 1923. He died in the early evening of January 3rd 2002 surrounded by his family. His daughter Charlene De Cavalho took over the family’s controlling interest.

 


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