The scarcity of jobs in the formal sectors among other factors has led to the promotion of entrepreneurship as a vehicle of creating wealth and employment in many countries. For instance, the government, financial institution and training institutions, non-government organizations and donor agencies have done a lot to inculcate the entrepreneurship culture in underdeveloped countries. Nevertheless necessity entrepreneurs are the majority in the modern world and if everyone makes conscious decisions to alleviate the current plight facing the world, we will open a new and better chapter in the performance of our global economy. In addition, its the devotion of individual entrepreneurial ventures towards achieving their objectives that makes a difference between successful enterprises and unsuccessful ones. In this regard it is prudent for businesses with vision to create a strong network with larger or smaller enterprises. In this way, it does not only create an avenue for publicizing the operations of the business but it also creates a strong foundation on which advertisement strategies can be undertaken thus creating strong customer loyalty. This paper will keenly analyze the historical facts that surround Body shop, one of the worlds popular cosmetics venture. Likewise, the paper will analyze the major strategic decisions undertaken by the firm as well as their implications on the general perspective of entrepreneurship.
Historical facts about Body shop
Body shop international plc is a cosmetics business venture located in UK.Being the second largest cosmetic company in the world after Boticario, a Brazilian firm the shop is headquartered in Little Hampton, England. Body shop was an entrepreneurial initiative by the late Anita Roddick.It was out of her desire to give women the best beauty products. Her business idea was generated from her wide traveling of African and European countries in 1970s. Body shop started its operations in 1976 during when it met a ready market for its products resulting to an upward growth of 50 per annum.It is out of its intensive corporate social responsibilities that the business created a very strong relationship with its customers just after it was established.
In 1984, Body shop shares were floated in the London Stock Exchange during when the price of shares raised by more than 600.This resulted to an increase in the publicity of the company attracting more shareholders and other investors. This was a step forward for Anita and Roddick who had high interest to expand the capital base of the Body Shop (Deakins and Freel, 2009).
In 2006, Body shop was bought by Oreal a well known entrepreneur in UK.This was then turning point of the shop which made Anita and Roddick, the pioneers of the business to emerge with quite good amount of money which put them among the top 100 richest people in UK.
The history of the shop is also clearly attributed to the measures that it has undertaken in conservation of environment and gender equality. For example in 1997, the business came up with a strategy which positively enhanced personal growth of women as well as raising their self esteem. This was a promotion strategy which made the company to achieve higher recognization in 1990s (Schindehutte et al, 2009).
The policy of Body shop not to test their products on animals is also another aspect that made the business to achieve the international recognization.It was out of its positive working ethics that resulted to the firm being awarded a Lifetime Achievement Award in 2009.As a result the business achieved another global recognization which was not only an avenue that surprised the competitors but also it made the company retain the competitive advantage that it acquired during its launching.The contribution of the shop especially in assisting the underdeveloped countries to use utilize their resources, cannot be overlooked. In 1991, the shop undertook macroeconomic strategies which resulted to introduction of a paper industry in Nepal which created employment opportunities for more than 40 people. Through its policy of Trade not aid, the business has campaigned against oppression in the work places, poor working conditions and low salaries for workers. Body shop foundation is also another achievement which was initiated by Anita. The foundation helps the poor countries to come up with projects which act as the source of employment. In addition, the firm uses it as a way of campaigning against violence against animals and environment pollution. Through this initiative, Body shop has gained in comparison to its competitors who have gone global yet they do not put into consideration the importance of environment conservation.
Body shop strategic planning
Strategic planning is a very vital aspect that an entrepreneurial venture such as Body shop cannot overlook. The process entails determining the things which needs to be done in order to achieve the objectives of an entity regardless of its size. Without proper planning, businesses expose themselves to quite a number of negativities including making of high losses as result of lack of direction, vision and purpose. Similarly, strategic planning involves proper management of assets capital contributed by shareholders as well as proper utilization of available recourses including human resources (Barringer and Ireland 2008).In this regard it is important for managers to come up with clear goals and objectives. This can only be achieved by adopting a very dynamic strategic plan. This section highlights the major plans emulated by Body shop in its early years of operation.
Capital contribution
Having been established in 1976 by Anita Lucia, Body shop faced a number of challenges which called for adequate devotion by the Anita and her husband Gordon Roddick. The shop was faced by lack of adequate capital for expansion which limited its operations which were initially limited in the UK market. Due to the need of the shop pioneers (Anita and Gordon), to expand and reconstruct their business they came up with a strategy that involved use of Franchisees. These were the initial capital contributors who saved Body shop from the financial challenges that faced the entity. The plan involved contribution of capital by the franchisees so as to be part of the business although the overall management was vested on Anita and Gordon. The arrangement of their participation in the operations of the business was outlaid in a renewable annual contract which ensured that the franchisees paid a fixed fee per year so as to continue being part of the business. In the same way the Franchisees were given additional duties to service Body shop stores and furniture so as to streamline the activities of the business.
The second strategic plan that was adopted by Body shop was training of its staff members. Bearing in mind the business was just in its early stages with a limited market share, Anita recognized the need to train the newly recruited employees so as to equip them with appropriate marketing strategies that would oversee the expansion of the business in the UK and foreign countries. The responsibility of training the members of staff was also vested on the Franchisees. This resulted to a high level of motivation by the employees which lead to increased productivity hence radical expansion of the business in the 1980s.In regard to its expansion strategy of its stores, the managers gave the Franchisees duties of identifying the viable locations where the business constructed more branches in the UK and abroad (Burns, 2007).
Distribution strategies
In its early distribution of the cosmetics products, Body shop utilized the services of Franchisees to reach its consumers. However, in order to be awarded exclusive rights to be the distributors, Franchisees were required to display high level of competent and organization whish are vital aspects for proper distribution of any product in the market. This was undertaken by first giving them a chance to manage their own shops whose operations, profitability and competency were closely monitored by Anita and Gordon. This was an early strategic plan that was initiated in order to safeguard loss of products as a result of improper channel of distribution or fraud. It is imperative to note that in during its operations, Body shop managers were not very concerned with adopting their own distribution avenues but their aim was to streamline the activities of the Franchisees as their own distributors. Based on the fact that the distributors were also part of the business it has positive effects in that it reduced costs of distribution and at the same time it resulted to efficiency since the Franchisees and the managers shared the common goal of maximizing profits. However, due to the high demand and the need to give its customers quality services, Body shop diversified its distribution channels by investing in lorries which transported the products from the company manufacturing point to the warehouses, and then to the retailer shops. This was as result of the expansion of the business which led to increased level of transaction forcing the company to have a well specialized distribution network instead of relaying on the Franchisees alone. It is based on this background that it became possible for consumers to get their products within 24 hours from the time they placed their orders. This was a great achievement for Body shop being a newly established business venture.
Marketing strategies
Marketing strategies refers to the techniques that are adopted by business entities in order to reach their consumers. Thus it entails advertising, promotion, pricing, distribution and public relations. Without proper marketing initiatives, entrepreneurial ventures may not have enough strength to face the current cut throat competition in the business world. In its initial stages, Body shop did not have any plan to spearhead advertising campaigns (Bjerke and Hultman, 2002).This may seem to be a strategy that was not appropriate but the most important issue was the management alternative strategies to increase the awareness of products in the minds of their consumers. In order to enhance customers loyalty, Body shop under the leadership of Anita took a particular dimension which entailed application of Public Relations as a marketing tool. Specifically, the shop became more concerned with the repercussion that it brought on the environment. This resulted to the company culture of environmental conservation and sponsorship of beauty contests which are still being used up-to-date by the Body shop marketing department. To be more effective in its strategies to create positive relationship between the consumers and the company, the shop put in place employees training programs which educated them on how to conserve the environment.
Evaluations of Body shop strategies and their impact on my entrepreneurship skills.
The raising of capital strategy that was adopted by Body shop was appropriate based on the fact that the company was at its initial stages of operations. Being an entrepreneurial venture that was aiming at increasing profits and minimizing costs, the business took the opportunity of engaging franchisees so as to acquire a strong financial position. This has enhanced my perception of entrepreneurship in the sense that it is prudent to utilize the strengths of other individuals or firms in order to achieve business goals.Secondly, it has taught me that in order to succeed in business we need to have good policies which include division of labor, positive relationship with the competitors and lack of bureaucracy in business (Bridge et al, 2009).
The strategy adopted by Body shop in terms of distributing its products is another aspect that enterprises should emulate. One of the major costs that results to reduced profits and sales is the distribution costs. This is attributed to the high charges and commissions paid to the brokers and middlemen in their duties as distributors. Body shop realized this negative impact and engaged Franchisees to distribute its products. As mentioned earlier, the interest of the company distributors was to maximize profit and sales which made the Franchisees to improve their distribution strategies. This approach has rekindled my entrepreneurship skills in that it I realize that it is imperative to avoid middlemen in the distribution of products. This is based on the fact that most of them are aiming at maximizing their own profits without much interest on the performance of the business. The monitoring approach adopted by Anita was a good management technique that every enterprise should put in place. This is vital in order to avoid laziness by employees or any form of financial fraud that may arise in the process of operating business.
In regard to marketing strategies which were adopted by Body shop, it is important to note that though the aim was to attract more customers the firm valued the effectiveness of its marketing techniques. Contrary to many companies which spend huge amount of money in advertising and promotion, Body shop did not spend any money through advertising. The shop valued environmental conservation as a way of attracting the attention of the community and the potential customers. This marketing strategy has taught me the importance of utilizing marketing opportunities that are not used by other enterprises. This ensures increased number of customers who are not very attracted by the advertisements but by the value the company and the products add to their live.
Based on the above analysis it is clear that the two critical virtues that all entrepreneurs must embrace are patience and perseverance. As all successful business people would attest, many of the obstacles which they experience when well handled, become enormous business opprrtunity.Just as the Roddicks worked hard, successful entrepreneurs are energetic and they are able to seek and exploit opportunities which come their way. This gives them and edge and earns them customers in the competitive world of business.
Historical facts about Body shop
Body shop international plc is a cosmetics business venture located in UK.Being the second largest cosmetic company in the world after Boticario, a Brazilian firm the shop is headquartered in Little Hampton, England. Body shop was an entrepreneurial initiative by the late Anita Roddick.It was out of her desire to give women the best beauty products. Her business idea was generated from her wide traveling of African and European countries in 1970s. Body shop started its operations in 1976 during when it met a ready market for its products resulting to an upward growth of 50 per annum.It is out of its intensive corporate social responsibilities that the business created a very strong relationship with its customers just after it was established.
In 1984, Body shop shares were floated in the London Stock Exchange during when the price of shares raised by more than 600.This resulted to an increase in the publicity of the company attracting more shareholders and other investors. This was a step forward for Anita and Roddick who had high interest to expand the capital base of the Body Shop (Deakins and Freel, 2009).
In 2006, Body shop was bought by Oreal a well known entrepreneur in UK.This was then turning point of the shop which made Anita and Roddick, the pioneers of the business to emerge with quite good amount of money which put them among the top 100 richest people in UK.
The history of the shop is also clearly attributed to the measures that it has undertaken in conservation of environment and gender equality. For example in 1997, the business came up with a strategy which positively enhanced personal growth of women as well as raising their self esteem. This was a promotion strategy which made the company to achieve higher recognization in 1990s (Schindehutte et al, 2009).
The policy of Body shop not to test their products on animals is also another aspect that made the business to achieve the international recognization.It was out of its positive working ethics that resulted to the firm being awarded a Lifetime Achievement Award in 2009.As a result the business achieved another global recognization which was not only an avenue that surprised the competitors but also it made the company retain the competitive advantage that it acquired during its launching.The contribution of the shop especially in assisting the underdeveloped countries to use utilize their resources, cannot be overlooked. In 1991, the shop undertook macroeconomic strategies which resulted to introduction of a paper industry in Nepal which created employment opportunities for more than 40 people. Through its policy of Trade not aid, the business has campaigned against oppression in the work places, poor working conditions and low salaries for workers. Body shop foundation is also another achievement which was initiated by Anita. The foundation helps the poor countries to come up with projects which act as the source of employment. In addition, the firm uses it as a way of campaigning against violence against animals and environment pollution. Through this initiative, Body shop has gained in comparison to its competitors who have gone global yet they do not put into consideration the importance of environment conservation.
Body shop strategic planning
Strategic planning is a very vital aspect that an entrepreneurial venture such as Body shop cannot overlook. The process entails determining the things which needs to be done in order to achieve the objectives of an entity regardless of its size. Without proper planning, businesses expose themselves to quite a number of negativities including making of high losses as result of lack of direction, vision and purpose. Similarly, strategic planning involves proper management of assets capital contributed by shareholders as well as proper utilization of available recourses including human resources (Barringer and Ireland 2008).In this regard it is important for managers to come up with clear goals and objectives. This can only be achieved by adopting a very dynamic strategic plan. This section highlights the major plans emulated by Body shop in its early years of operation.
Capital contribution
Having been established in 1976 by Anita Lucia, Body shop faced a number of challenges which called for adequate devotion by the Anita and her husband Gordon Roddick. The shop was faced by lack of adequate capital for expansion which limited its operations which were initially limited in the UK market. Due to the need of the shop pioneers (Anita and Gordon), to expand and reconstruct their business they came up with a strategy that involved use of Franchisees. These were the initial capital contributors who saved Body shop from the financial challenges that faced the entity. The plan involved contribution of capital by the franchisees so as to be part of the business although the overall management was vested on Anita and Gordon. The arrangement of their participation in the operations of the business was outlaid in a renewable annual contract which ensured that the franchisees paid a fixed fee per year so as to continue being part of the business. In the same way the Franchisees were given additional duties to service Body shop stores and furniture so as to streamline the activities of the business.
The second strategic plan that was adopted by Body shop was training of its staff members. Bearing in mind the business was just in its early stages with a limited market share, Anita recognized the need to train the newly recruited employees so as to equip them with appropriate marketing strategies that would oversee the expansion of the business in the UK and foreign countries. The responsibility of training the members of staff was also vested on the Franchisees. This resulted to a high level of motivation by the employees which lead to increased productivity hence radical expansion of the business in the 1980s.In regard to its expansion strategy of its stores, the managers gave the Franchisees duties of identifying the viable locations where the business constructed more branches in the UK and abroad (Burns, 2007).
Distribution strategies
In its early distribution of the cosmetics products, Body shop utilized the services of Franchisees to reach its consumers. However, in order to be awarded exclusive rights to be the distributors, Franchisees were required to display high level of competent and organization whish are vital aspects for proper distribution of any product in the market. This was undertaken by first giving them a chance to manage their own shops whose operations, profitability and competency were closely monitored by Anita and Gordon. This was an early strategic plan that was initiated in order to safeguard loss of products as a result of improper channel of distribution or fraud. It is imperative to note that in during its operations, Body shop managers were not very concerned with adopting their own distribution avenues but their aim was to streamline the activities of the Franchisees as their own distributors. Based on the fact that the distributors were also part of the business it has positive effects in that it reduced costs of distribution and at the same time it resulted to efficiency since the Franchisees and the managers shared the common goal of maximizing profits. However, due to the high demand and the need to give its customers quality services, Body shop diversified its distribution channels by investing in lorries which transported the products from the company manufacturing point to the warehouses, and then to the retailer shops. This was as result of the expansion of the business which led to increased level of transaction forcing the company to have a well specialized distribution network instead of relaying on the Franchisees alone. It is based on this background that it became possible for consumers to get their products within 24 hours from the time they placed their orders. This was a great achievement for Body shop being a newly established business venture.
Marketing strategies
Marketing strategies refers to the techniques that are adopted by business entities in order to reach their consumers. Thus it entails advertising, promotion, pricing, distribution and public relations. Without proper marketing initiatives, entrepreneurial ventures may not have enough strength to face the current cut throat competition in the business world. In its initial stages, Body shop did not have any plan to spearhead advertising campaigns (Bjerke and Hultman, 2002).This may seem to be a strategy that was not appropriate but the most important issue was the management alternative strategies to increase the awareness of products in the minds of their consumers. In order to enhance customers loyalty, Body shop under the leadership of Anita took a particular dimension which entailed application of Public Relations as a marketing tool. Specifically, the shop became more concerned with the repercussion that it brought on the environment. This resulted to the company culture of environmental conservation and sponsorship of beauty contests which are still being used up-to-date by the Body shop marketing department. To be more effective in its strategies to create positive relationship between the consumers and the company, the shop put in place employees training programs which educated them on how to conserve the environment.
Evaluations of Body shop strategies and their impact on my entrepreneurship skills.
The raising of capital strategy that was adopted by Body shop was appropriate based on the fact that the company was at its initial stages of operations. Being an entrepreneurial venture that was aiming at increasing profits and minimizing costs, the business took the opportunity of engaging franchisees so as to acquire a strong financial position. This has enhanced my perception of entrepreneurship in the sense that it is prudent to utilize the strengths of other individuals or firms in order to achieve business goals.Secondly, it has taught me that in order to succeed in business we need to have good policies which include division of labor, positive relationship with the competitors and lack of bureaucracy in business (Bridge et al, 2009).
The strategy adopted by Body shop in terms of distributing its products is another aspect that enterprises should emulate. One of the major costs that results to reduced profits and sales is the distribution costs. This is attributed to the high charges and commissions paid to the brokers and middlemen in their duties as distributors. Body shop realized this negative impact and engaged Franchisees to distribute its products. As mentioned earlier, the interest of the company distributors was to maximize profit and sales which made the Franchisees to improve their distribution strategies. This approach has rekindled my entrepreneurship skills in that it I realize that it is imperative to avoid middlemen in the distribution of products. This is based on the fact that most of them are aiming at maximizing their own profits without much interest on the performance of the business. The monitoring approach adopted by Anita was a good management technique that every enterprise should put in place. This is vital in order to avoid laziness by employees or any form of financial fraud that may arise in the process of operating business.
In regard to marketing strategies which were adopted by Body shop, it is important to note that though the aim was to attract more customers the firm valued the effectiveness of its marketing techniques. Contrary to many companies which spend huge amount of money in advertising and promotion, Body shop did not spend any money through advertising. The shop valued environmental conservation as a way of attracting the attention of the community and the potential customers. This marketing strategy has taught me the importance of utilizing marketing opportunities that are not used by other enterprises. This ensures increased number of customers who are not very attracted by the advertisements but by the value the company and the products add to their live.
Based on the above analysis it is clear that the two critical virtues that all entrepreneurs must embrace are patience and perseverance. As all successful business people would attest, many of the obstacles which they experience when well handled, become enormous business opprrtunity.Just as the Roddicks worked hard, successful entrepreneurs are energetic and they are able to seek and exploit opportunities which come their way. This gives them and edge and earns them customers in the competitive world of business.
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