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The Body Shop strategy.

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CORPORATE STRATEGY AND DECISION MAKING THE BODY SHOP STRATEGY INTRODUCTION "The world of Business has taught me nothing ... I honestly believe I would not have succeeded if I had been taught about business" (Roddick: 1989) On March 26th 1976 a young lady of 33 by the name of Anita Roddick who had a deep rooted passion for environmental activism and no prior business knowledge decided to open a small store in Brighton by the name of The Body Shop selling natural based, self mixed beauty produce that she had discovered from her travels throughout the South Pacific and Africa. Her main aim at the time was to support her husband who was travelling around America and their 2 young children. With the advice to try and earn �300 a week from Gordon her husband she set about The Body Shop's raise to global fame and influence. With just 25 hand mixed products in her Brighton store in 1976 and each product having 5 different bottle sizes to simply bulk up the shops shelves she has managed to transform the organisation to be harbouring over 1,954 stores world wide today. (Mintel : 03) The question has to be asked how has a woman with no prior business knowledge or education managed to achieve such a feat? Is Business knowledge meaningless? Were Body Shop simply headless and happen to stumble along the correct path? Or has The Body Shop operated cleverly and adopted unique strategies to differentiate themselves away from the norm? Throughout the following text we will discover the way in which The Body Shops historic strategy brought about its rise to world wide status and then later its decline. We will see the way the company has adjusted its strategy to try and halt this. This will then be followed by the evaluation of how both Porters five forces and SWOT analysis models may account for their success and the way in which they deal with the esoteric aspect of the body shops way of doing business. ...read more.


So how The body Shop differentiates itself, manages its weaknesses and exploits its opportunities is a now dilemma that Body Shop must face. "Five forces analysis is a means of identifying the forces which affect the level of competition in an industry" (Johnson, Scholes: 1998) M. Porter sees competition "as the core of the success or failure of firms" (Wit, Meyer : 345) and that the essence of formulating competitive strategy is by relating a company to its environment (Porter: 3) Therefore he designed a frame workforce to that shows state of competition in an industry which is based around five forces. We can see these five forces and what they involve in figure 4. As we can see it is in a rather simplified format regarding the amount of the detail it goes into. Porter actually goes into more depth and detail regarding his texts, therefore simplified models of the five forces are not as informative as it could possibly be so should be considered as a framework for further analysis. However for use in the case of Body Shop and the word constraint it still can provide us with a useful knowledge of the environment that Body Shop is facing and how it accounts for it success and failings Firstly considering the threat of substitution for Body Shop products we can consider this to be high. Body Shop is in direct competition with the beauty industry both natural and unnatural. As competition in its niche market increases substitution becomes a bigger threat. This is certainty is a hindrance to Body Shop currently. However the threat of substitutes has actually helped in this case, Porter asks the question of "whether or not a substitute poses the threat of obsolescence to a firms product or service, or actually provides a higher perceived benefit or value" (wit, meyer : 120) This covers the case of the Body Shop actually providing beauty products but actually only providing natural ones. ...read more.


For example we have understood the strengths and core competences among Body Shop International over the past 27 years. We also understand the challenges facing the company, and what actions may be appropriate to counteract them. These types of models not only provide an overview for ourselves but also an overview and understanding for the Body Shop to observe themselves from the outside in. Strategic models are designed for the process of influencing and aiding decision making and from using such models as SWOT analysis companies are able to assess themselves and if necessary change direction or continue to drive themselves forward. We gather from the essay that this is certainty the case with Body Shop changing its direction in 1998 toward a more cost minded approach. The impression is that the models provide a solid frame work from which to aid decision, however frameworks can be simplified, static or simply too opinion based. Such as is the case with SWOT. Therefore when considering esoteric strategies models can sometimes be less than accommodating as with such examples as shown in the case of the five forces SWOT. I conclude that frameworks are good for guidance and a foundation to build upon but are less than perfect for calculating entire decisions. As for the success of the Body Shops current strategy of more traditional strategic thinking whilst still supposedly keeping its older core competence we can only wait and see. Although it must be said if The Body Shops prime concern is for its ethical and social stance and as Anita claimed "Businesses should not be judged on profit" (Mintzberg, Quinn, Ghoshol : 99, 457) then why is it that they have allowed themselves to change to a cost based function as well as change its ethics from environment to environment. Do they or have they really had an esoteric way of doing business or is a simply a strategic marketing pitch? Word Count: 3224 Corporate Strategy and Decision Making - 1 - ...read more.

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