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    Robert Mondavi Case Study

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    Krithika Naidu
    Robert Mondavi had three strategic options for growth: organic growth, acquiring local wineries, or acquiring foreign wineries. Organic growth through expanding customer base and products would allow Mondavi to maintain control but be relatively expensive and slow. Acquiring local wineries could diversify brands and increase scale and market share but reduce control. Acquiring foreign wineries could develop global brands and diversify revenue but increase debt and reduce control.

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    Robert Mondavi Case Study

    Uploaded by

    Krithika Naidu
    892 views3 pages
    Robert Mondavi had three strategic options for growth: organic growth, acquiring local wineries, or acquiring foreign wineries. Organic growth through expanding customer base and products would allow Mondavi to maintain control but be relatively expensive and slow. Acquiring local wineries could diversify brands and increase scale and market share but reduce control. Acquiring foreign wineries could develop global brands and diversify revenue but increase debt and reduce control.

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    Strategic Management

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    Robert Mondavi had three strategic options for growth: organic growth, acquiring local wineries, or acquiring foreign wineries. Organic growth through expanding customer base and products would allow Mondavi to maintain control but be relatively expensive and slow. Acquiring local wineries could diversify brands and increase scale and market share but reduce control. Acquiring foreign wineries could develop global brands and diversify revenue but increase debt and reduce control.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    892 views3 pages

    Robert Mondavi Case Study

    Uploaded by

    Krithika Naidu
    Robert Mondavi had three strategic options for growth: organic growth, acquiring local wineries, or acquiring foreign wineries. Organic growth through expanding customer base and products would allow Mondavi to maintain control but be relatively expensive and slow. Acquiring local wineries could diversify brands and increase scale and market share but reduce control. Acquiring foreign wineries could develop global brands and diversify revenue but increase debt and reduce control.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    Robert Mondavi Case Study

    Examine, from the perspective of Mondavi, the pros and cons of each of the three strategic
    options.
    a. Organic growth
    b. Acquisition or merger with local wineries
    c. Acquisition or merger with foreign wineries
    Organic Growth: Organic growth is the process of businesses expansion due to increasing the
    customer base, output per customer, and/or through new sales.
    Organic growth
    - Mostly for its
    premium brands
    - Deliberate
    geographic
    expansion, high
    quality products,
    detailed
    consumer
    research and
    attention to
    customer needs
    and preferences

    Acquisition or merger
    with local wineries

    Acquisition or merger

    Pros
    Better control and
    coordination: Firms
    maintain controls
    whereas external
    methods lead to loss of
    control and ownership
    Relative inexpensive:
    Source comes from
    retained earnings, less
    risk as the amount of
    capital involved is
    relative lower than
    external
    Ability to maintain
    corporate culture: No
    problems related to
    culture clash that
    might rise in
    acquisition
    environments
    Safer as it involves
    adapting a familiar
    business model

    Domestic brand
    diversification (build
    brand portfolio in the
    premium wine market
    in terms of price
    points, niche)
    Economies of scale
    would help to reduce
    secondary costs
    Acquisition of more
    land
    Greater market share

    Cons
    Harder due to increasing
    competitive landscape, market
    consolidation, large market
    cap
    Diseconomies of scale:
    Hierarchical structures may
    increase communication probl
    ems, and there may be slow
    decision making.
    Need to restructure: When
    a firm grows, there is a need to
    restructure (requires times,
    effort, money),
    communications will need to
    be handled with more care,
    and there is a need for
    training/retraining/updating
    the set of skills for staff.
    Delegation of decisionmaking powers to managers
    (reducing control of original
    owners) will take place.
    -

    Using long term debt


    to finance acquisition

    with foreign wineries

    Able to develop global


    recognition for
    Mondavi brands
    Diversify revenue
    stream
    Able to grow its
    financials

    References:
    https://www.boundless.com/business/textbooks/boundless-business-textbook/types-ofbusiness-ownership-6/corporate-growth-54/organic-growth-268-5574/
    http://www.slideshare.net/KRDickson/Mondavi
    http://www.slideshare.net/fullmoonded/robert-mondavi-and-the-wine-industry-case
    (For resources on capabilities and tangible/intangible assets)
    http://custom-essay-cheap.com/robert-mondavi-and-the-wine-industry/
    http://metersolution.com/wp-content/uploads/2013/02/3835-15324-1-PB-1.pdf
    http://www.slideshare.net/JohnnySchaefer/case-study-mondavi-winedoc

    - SWOT Analysis

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