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The Body Shop Strategic Analysis

3601 words - 14 pages

The Body Shop InternationalCASE ISSUES:Market Saturation/Loss of Sales (CI#1) - Growth Strategy is no longer working for The Body Shop. Their store growth has diminished since the mid-1990s, and by 2002 the company's profit was shrinking, and sales were not growing proportionally to the rapid expansion of stores. Having entered a retrenchment phase, they need to focus on profitability without rapid expansion.Is Anita Gone? (CI#2) - Though Anita Roddick stepped down as CEO in 1998, and resigned as Executive Chairman in 2002, it is unclear how much influence she has on day-to-day operations and strategy.Core Values (CI#3) - By changing top management and governance, The Body Shop runs the risk of losing their identity and their core values. Losing touch with these values could cause a loss of reputation, however, clinging to them above shareholder's value is also detrimental.Loss of Image (CI#4) - The Body Shop's image seems to be undergoing another makeover. With Anita Roddick being at least a less visible member of the organization, The Body shop no longer practices eccentricity for eccentricity's sake. However, changing their image has also meant they have lost their uniqueness among their competitors.I. CURRENT SITUATIONA. CURRENT PERFORMANCEThe Body Shop achieved an overall solid performance for the year 2004 especially with strong sales in the USA (+ 4%), the Middle East (+4%), the Nordic countries (+4%) and most part of Asia pacific (+2%). However, these encouraging numbers were offset by weak sale in the United Kingdom (-13%), Canada (-10%) and parts of Europe (-7%).This growth occurred while the growth of stores slowed. This may signal a shift away from the extreme growth model to a focus on quality.B. STRATEGIC POSTUREMissionsØ To dedicate their business to the pursuit of social and environmental changeØ To balance the financial and human needs of their stakeholders: employees, customers, franchisees, suppliers and shareholders.Ø To ensure that their business is ecologically sustainable: meeting the needs of the present without compromising the futureØ To contribute to local, national and international communities in which they trade, by adopting a code of conduct which ensure care, honesty, fairness and respect.Ø To campaign for the protection of the environment, human and civil rights, and against animal testing within the cosmetics and toiletries industry.ObjectivesØ Drive customer loyalty "focus on customer' satisfaction by providing them with the best global practices and services among the four regions we are running our brand".Ø Launch a $100 million expansion program which aims to: expand operations, open new channels, and install new infrastructureØ Developing innovative and credible productsØ Keep price affordableStrategiesØ Move the brand to a "masstige" positioning by developing original products at affordable price. (CI#4)Ø Launch marketing...

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