...Teaching Case ______________________________ Journal of Applied Case Research Sponsored by the Southwest Case Research Association “BUSINESS AS UNUSUAL”: A CASE STUDY ON THE BODY SHOP Subhadip Roy ICFAI University, India Lopamudra Ghosh ICFAI University, India © Journal of Applied Case Research Accepted: September 2008 2 “BUSINESS AS UNUSUAL 1 ”: A CASE STUDY ON THE BODY SHOP “The business has existed for one reason only – to allow us to use our success to act as a force of change, to continue the education and consciousness-raising of our staff, to assist development in the Third World and above all, to help protect the environment. What we are trying to do is to create a new business paradigm, simply showing that business can have a human face and a social conscience”. - Anita Roddick (1991) 2 ANITA RODDICK STEPPED DOWN AS THE BODY SHOP CHAIRPERSON February 2002, the founder of one of the biggest cosmetics companies in the world, Anita Roddick (Anita) stepped down as the chairperson of the Body Shop along with husband Gordon Roddick (Gordon), who was a co-chair along with her. A number of controversies in the mid and end 1990’s had badly affected the company’s image as doing “business with a human face” as opined by Anita in the quote given above. Periods of losses, coupled with poorly motivated shareholders, de-motivated franchisees, unsuccessful restructuring attempts and public propaganda against the company was proving to be too strong for the company...
Words: 6340 - Pages: 26
...The Body Shop International Case Study The Creator- When one read the words The Body Shop one would think of working on cars. Not for Mrs. Anita Roddick, she thought of The Body Shop as a way to give women what they had been looking for in cosmetics. Mrs. Anita Roddick was born in England in 1942, to Italian immigrants. She was a human rights activist and an environmental campaigner; she was also the founder The Body Shop. The Body Shop was a cosmetics company that produces and sold beauty products. The Body Shop was the first company to prohibit its ingredients on animals and one of the first to encourage fair trade in other third world countries. Mrs. Anita intention of creating this company was to make money for her daughters and herself while her husband travels the world instead the company became a multi-billion company. The Body Shop had 1980 stores serving over 70 million customers all over the world by 2004. In 2006 Mrs. Anita sold her multi-billion company to L’Oreal, which caused problems. The problem came because Mrs. Anita would let her company use animals as test subjects and L’Oreal did. She was very active with charity for children and other works. Sales from The Body Shop went down south. The Beginning- Mrs. Anita had several jobs before she decided to create The Body Shop. In 1976 Mrs. Anita founded The Body Shop and it grew rapidly over the years. After being the CEO of her company in May 1998, Anita Roddick stepped down and appointed Patrick Gournay as...
Words: 349 - Pages: 2
...POSITION OUTLINE_THE BODY SHOP DAN VELAZQUEZ Anita Roddick, founder of The Body Shop (TBS), was an eccentric business leader and advocate of participating in moral leadership at the corporate level. Roddick not only established a lasting set of core values for TBS, but also helped set a precedent for the Corporate Social Responsibility (CSR) i initiatives now widely practiced by many international corporations. Bartlett and Ghoshal succinctly summarize the philosophy that Roddick embedded within TBS ii. In more broadly describing the need to go ‘beyond strategy to purpose’, Bartlett and Ghoshal go on to write that “contractually based relationships do not inspire the extraordinary effort and sustained commitment required to deliver consistently superior performance.” In a similar manner, Kouzes and Posner write that “the key task for leaders is inspiring a shared vision, not selling their own idiosyncratic view of the world. What this requires is finding common ground among those people who have to implement the vision.” Roddick was successful at establishing a shared vision at TBS that others not only found common ground in, but were also inspired by. In my mind, the aforementioned concept of inspiration parallels the Golden Circle iii that Sinek describes in his TED talk. Out of all of the material we reviewed this week, Sinek’s video resonated with me the most. It also helped me to tie all of the readings together, including the Core Ideology iv that Collins and Porras...
Words: 749 - Pages: 3
...Words: 1586 Explain the relevance of the Marketing Concept to the 21st Century business of your choice? This essay will explain the relevance of the Marketing Concept to the 21st century business the Body Shop International plc. As well this will observe how Anita Roddick successfully adapted marketing concept to the Body Shop by creating satisfied happy customers and company goal achievement. There have been a growing number of companies over the years which influenced the increasing density of the business, different marketing concept have used to boost the businesses. Many of authors have found different ways to customise marketing concepts and one of the earliest famous people suggested, that the defining characteristic “the marketing concept holds that achieving organisational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do” (Kotler and Armstrong 2010, p.34) The above term shows that without customers, there is no sale. Without satisfied customers, there is no profit. Without delighted customers, there is no repeat business, as “companies achieve their profit and other objectives by satisfying (even delighting) customers” (Jobber 2007, p. 4) To apply this concept, three conditions should be met: 1. Company activities should be focused upon providing customer satisfaction rather than, for example, producer convenience. 2. The achievement of customer satisfaction relies on integrated...
Words: 1675 - Pages: 7
...Introduction The Body Shop was established in 1976, selling scented soaps and lotions, made only from natural ingredients. Within 14 years, the company expanded into 39 countries, with over 1200 lines of products today. The founder, Anita Roddick, was known as an avid social activist and she largely promotes and supports causes such as ending animal testing In 2006, The Body Shop was bought by L’Oréal SA for £652m. The Body Shop- Managing Public Relations Anita Roddick was quick to recognise that there was a market for natural-based skin products that were free from chemicals and were not tested on animals. After gaining awareness on public’s position, The Body Shop took steps in building an effective public relations programme. This programme includes marketing its brand as one that is socially responsible, their core values being: against animal testing, support community trade, activate self-esteem, defend human rights, protect our planet. With clearly defined core values, the business was able to influence consumer’s imaginations, and perceive The Body Shop as an ethical business presence. In 1990, upon conducting environmental analysis, Anita Roddick took a different approach in promoting her products, claiming that she was uninterested in seducing consumers with expensive images. Instead, she established the environmental projects and community care department to portray the company as one that is socially responsible. This was part of its business plan of adopting...
Words: 1569 - Pages: 7
...The Body Shop International PLC, known as The Body Shop, has 1,200 products in 2,500 stores in 61[2] countries. The company, which has its headquarters in Littlehampton, West Sussex, England, was founded in 1976 by Anita Roddick and is now part of the L'Oréal corporate group. History In 1970, Anita Roddick (then Anita Perilli) visited "The Body Shop" housed in a car repair garage in Berkeley, California selling naturally-scented soaps and lotions called The Body Shop. The shop run by Peggy Short and Jane Saunders used natural ingredients, and helped to employ and train immigrant women. Six years later, in 1976, Roddick opened a similar shop in the UK, using the same business name, color scheme, and cosmetic lines. In 1987, Roddick offered Short and Saunders 3.5 Mio USD to change their shops name to Body Time. Until 1992 the rename was completed. [3][4][5]From its first launch in the UK in 1976, The Body Shop experienced rapid growth, expanding at a rate of 50 percent annually. The Body Shop stock was floated on London's Unlisted Securities Market in April 1984, opening at 95p. After it obtained a full listing on the London Stock Exchange, the stock was given the nickname "The shares that defy gravity," as its price increased by more than 500%. But the opening of Roddick's first modest shop received early attention when the Brighton newspaper, The Evening Argus, carried an article about an undertaker with a nearby store who complained about the use of the name "The Body...
Words: 599 - Pages: 3
...The Body Shop The Body Shop, one of the 21st Century's most iconic brands, started its first store in 1976. Today, it welcomes over 275 million shoppers to its stores every year, and has over 2,700 stores in 63 countries worldwide. Since its inception the essence of The Body Shop has been selling products made from natural ingredients. The customers found these products unique and were attracted towards the concept. But a major push for the brand came when the company got actively involved in social activism. In 1986 the company launched a campaign together with Greenpeace to save the whale. Similarly, it launched many other promotional campaigns with a social cause at the core. These campaigns gathered a lot of media and public interest. The company also protests firmly against the use of animals for testing cosmetics. Its web site explains that it does not sell or use either finished products or ingredients that were tested on animals after 31 December 1990. Today, The Body Shop is known for its commitment to values: Against Animal Testing, Community Fair Trade, Protect the Planet, Defend Human Rights and Activate Self Esteem. But the organization wants to be just as well known for its beauty credentials and product innovation. That is why it has started a new beauty movement called ‘Beauty with Heart’. The campaign talks about not just looking good, but feeling good and doing good, too. The best way to...
Words: 412 - Pages: 2
...Body Shop Case Study The Body Shop #1 1. In this case, how does The Body Shop address the four components of social responsibility? In the Body Shop, what tensions among these components were at work? Economic- The Body Shop used inexpensive ingredients in the products offered. There was also a recycle program where the customers could return used bottles and receive a discount which would save the company money by not having to buy more supplies. The Body Shop also created a company with strong values that customers stood by which was the reason their success. Legal- the Body Shop avoided animal testing and used all natural ingredients to avoid any lawsuits. They knew the products were safe since people have been using them for years. Ethical- Anita Roddick, owner of The Body Shop, reflected her personal ethical beliefs into her work. She was against animal testing and made a great effort to make sure her company and the suppliers also felt the same way. She also wanted her employees to fit a certain image and hired accordingly, some could argue this can cause some ethical problems. Philanthropic- The mission statement of The Body Shop is “To dedicate our business to the pursuit of social and environmental change” and the entire company was based around this. They contributed a part of their earnings to environmental change. Roddick shared her information about certain products with other companies in hopes of reducing animal testing. She preached to her customers about...
Words: 3268 - Pages: 14
...The Body Shop Stakeholder Panel Review 31 August 2008 Mission Statement ‘Dedicate our business to the pursuit of social and environmental change. Creatively balance the financial and human needs of our stakeholders: employees, customers, franchisees, suppliers and shareholders. Courageously ensure that our business is ecologically sustainable, meeting the needs of the present without compromising the future. Meaningfully contribute to local, national and international communities in which we trade by adopting a code of conduct that ensures care, honesty, fairness and respect. Passionately campaign for the protection of the environment, human and civil rights, and against animal testing within the cosmetics industry. Tirelessly work to narrow the gap between principle and practice, whilst making fun, passion and care, part of our daily lives.’ The Mission Statement of The Body Shop requires us to run our business in a way that balances economic, social and environmental needs. As well as assessing ourselves against our Mission Statement we also ask for comment from those outside the business with whom we share common objectives. In June 2008,The Body Shop International held a stakeholder panel review meeting The aim of the panel was to invite NGO’s to comment on current social and environmental performance within the business and help shape the future of The Body Shop sustainable development agenda. The 2008 stakeholder panel consisted of representatives from the British Union...
Words: 3102 - Pages: 13
...25 Finance Student 5010 South Robertson St. New Orleans, Louisiana 70115 (908)-752-2924 January 20, 2015 Anita Roddick, Founder: The Body shop International PLC 2001 Re: Case C: Chapter 8: The Body Shop International: An Introduction to Financial Modeling, Years 1 – 3 Observed Value of The Body Shop International as of February 28, 2004 = 2,000,000 GBP Dear Mrs. Roddick: As you requested, I have forecasted pro-forma statements and ratio analysis factors of The Body Shop International for Years 2001 through 2004, using the information presented in Bruner and the forecast assumptions on the Case Studies in Finance pages 120-126. I used these forecasted pro-forma statements as an Initial Scenario to analyze the interactive quality of the forecast assumptions made, and I adjusted the forecasted assumptions to I found the Borrowing amount for The Body Shop International as of 2001 (the beginning of Year 1) to be = $5,904,000. 1) & 2) I derived my forecast by taking a random growth rate percentage and the COGS/Sales ratio that the book had provided. As I plugged in higher growth rates the company debt began to grow larger. However the Retained earnings began to grow as well. The COGS/Sales ratio showed to have a similar affect but with a far greater increase in company debt. Whether there is an Increase in growth rate or and increase in the ratio of COGS/Sales, they both present an extreme increase in New Debt. If the COGS/Sales...
Words: 627 - Pages: 3
...CSR of the Body Shop The Body Shop International PLC, known as The Body Shop, is one of the largest cosmetic franchises in the world, which was founded in 1976 by Anita Roddick and is now part owned by L’Oreal. They are known for selling natural beauty products inspired by nature. It has a range consisting of 1,200 products, including cosmetics and make-up. The Body Shop is a good example of a business that has a very strong sense of Corporate Social Responsibility. They promote their business and products through social and environmental campaigns, as well as strong believers in community trade, and against animal testing. Over the years, The Body Shop has become a powerful force for change, and it is now recognized as trailblazers in serving customers with high-quality ethical beauty products. By the end of 2013, it has 2,900 stores across 63 markets, and more people than ever before are joining The Body Shop community. The Social and Environmental Responsibilities The Body Shop is committed to activate self-esteem, which means running a business that makes people who encounter the company feel good about themselves. The Body Shop promotes diversity in its employment practices through global equal opportunities standards. It enables personal development for its employees through volunteering, training, and personal development plans. This is because with these activities, The Body Shop could successfully reduce employee turnover which represents a significant cost saving...
Words: 1196 - Pages: 5
...The Body Shop had been successfully introduced into a new market and established itself as a differentiated cosmetics supplier with a conscious. What started off as a humble entrepreneurial venture in Brighton, England grew into a dominant player in a very saturated industry. After the franchising of the English stores and their subsequent implementation in Canada, The Body Shop gained renown success and began growing at an unprecedented rate. Unfortunately the company’s operational goals have become diluted and Margot and Betty-Anne Franssen no longer keep up with intense customer demand. Although the casual and informal business model had worked in the United Kingdom and to some extent in Canada, the Franssen sisters are faced with the tough task of formalizing and updating her business and franchises. In order to continue to succeed in Canada and examine the possibility of an additional expansion into the United States, Franssen must address two pressing issues that are inhibiting The Body Shop’s success: Mismanaged growth and a problematic organizational structure. Mismanaged Growth Many organizations strive to become successful as quickly as possible but there are times when well-run companies begin to fail because they grew to quickly. Preparing for growth is a crucial step in ensuring the sustainable development of a firm. There are a number of symptoms that clearly indicate the growth of a company is being mismanaged. In the case of The Body Shop, they include owner/employee...
Words: 1838 - Pages: 8
...I. STATEMENT OF THE PROBLEM Body Shop has been so successful while defying industry norms. It is now questionable for the business to survive as it enters the highly competitive market with its different kind of retailing approach. II. STATEMENT OF OBJECTIVES a. To defend itself against the wave of new competitions b. To maintain the growth, as well as the profitability of the business III. AREAS OF CONSIDERATIONS STRENGHT Brand Innovative products High brand loyalty Successful leadership skills Opportunities Growth in men's skin care products Increasing number of online buyers Aging population Weaknesses Declining stage. Lack of advertising. Losing trust from different stakeholders. Threats No marketing department and no advertising department. Environmental management system is not certified to an efficient standard. Improve operational efficiency Reduce inventory holding cost IV. ALTERNATIVE COURSES OF ACTION 1. Improve the brand image of the business • ADVANTAGE: A. Will attract more consumes and investors. B. Will gain the trust of the public. • DISADVANTAGE: A. It will incur cost. B. It will gain more responsibility to the public. 2. Enhance operational efficiency • ADVANTAGE: A. It will reduce product cost B. It will inventory holding cost C. Achieve reduction in overhead cost. • DISADVANTAGE: a. It creates shortage in their inventory b. It could affect the quality of the product. c. Productivity...
Words: 512 - Pages: 3
...CORPORATE STRATEGY EXECUTIVE ANALYSIS THE BODY SHOP The following analysis investigates how the organization assesses its own business whilst taking into account its different key stakeholders and their various interests and expectations by looking deep into a case study of The Body Shop. On the final note, it will determine what learning benefit the case of The Body Shop provides as well as whether its principles can apply to other situations. Introduction: The Body Shop In 1976, The Body Shop was established in Brighton by Dame Anita Roddick. The Body Shop International now has over 2,900 stores across 63 markets with a range of over 1200 products. The Body Shop story is not only of an eminently successful market-oriented manufacturer and retailer of toiletries and cosmetics. Like its founder, the whole organization is committed to issues such as respect for human rights, animal and environmental protection. The organization has arranged and supported national and international campaigns on animal testing in the cosmetic industry and women’s rights. All business organizations need to make a profit to survive but the emphasis at The Body Shop is on profit with a wider social responsibility. The Body Shop Mission Statement * “Dedicate our business to the pursuit of social and environmental change. * Creatively balance the financial and human needs of our stakeholders employees, franchisees, customers, suppliers and shareholders. * Courageously ensure that...
Words: 1709 - Pages: 7
...1. The forecast of the financial statements for Body Shop in the period 2002-2004 is developed based on the the historical data in Body Shop financial report in the last three years (1999-2001). From 2002 to 2004, the income statement and balance sheet is conducted using the percentage-of-sales method which initially forecasts firm’s sales then estimates all other accounts based on its relationship with sales. There are many assumptions which are used for conducting the firm’s income statement and balance sheet. However, the key assumptions are about sales, cost of goods sold to sales ratio, operating expense to sales ratio. * Sales: The growth rate of 13% is used for the next three years (2002-2004) as the sales growth rate of Body Shop increased significantly in 1990s because of there was only few competitors in the market. In addition, the growth rate of cosmetic and beauty industry in America and in over the world was a bit low during that time. Therefore, in the future, Body Shop’s sales growth rate should decrease to meet the average growth rate of this industry. Furthermore, it is difficult for Body Shop to improve their sales growth since there are more new entrants in this market in the next few years; and this potential market must be shared among these companies. Also, company tends to keep this growth rate at stable level for the next few years before deciding to make any change. The sales growth at 13% can also be derived from the opening of more than one hundred...
Words: 1039 - Pages: 5
