Brl Hardy: Globalizing an Australian Wine Company

Case Study 1 : BRL Hardy: Globalizing an Australian Wine Company

To: Chris Day, Group Strategic Planning Manager (BRL Hardy)

From: Strategic advisor

Re: Evaluation of BRL Hardy’s strategy for today and tomorrow

Table of Contents:

1. Report Objectives

2. Executive Summary

3. Industry Background

4. BRL Hardy Background

5. Issues within the Wine Industry

6. Implications for Attaining a Position of Competitive Advantage

7. Recommendations

1. Report Objectives

BRL Hardy wants to understand the relevancy of its current group strategy within the wine industry today and study the viability of this strategy moving forward. In particular, BRL Hardy wishes to understand the issues and implications that will be encountered by the BRL Hardy group if it pursues its goal of becoming not “just a quality exporter” but also “an international wine company with worldwide product access backed by the marketing capability and distribution muscle to create global brands”.

This report will provide recommendations on BRL Hardy’s global strategy. The recommendations will be based upon an understanding of the wine industry (both from a suppliers point-of-view as well as that of a consumer) and its likely future development, an investigation of the current and future competitive environment and a ranked list of BRL Hardy’s competences within this environment.

2. Executive Summary

The wine industry is a highly competitive industry that has yet to see emerge a true global company with a global brand. BRL Hardy’s position within this industry is presently, similar to many other companies, that of a small global-volume supplier and distributor that has a large footprint within its “country-of-origin”, Australia. The goal of becoming an international wine company is ambitious but achievable; however several changes are recommended in order to make this possible.

The notion of BRL Hardy as an “international wine company” should become the visionary “beacon” for the company. The strategy required to achieve this vision can then be used as the supporting framework. We will use the “three pillar model” of RW&JR Cartwright Consultancy Ltd.

Overarching strategic concept:

Position the BRL Hardy brand within the premium segment of the wine market including the extra dimensions of fun, environmentally friendliness and sustainability (along the lines of the “domestic turnaround” implemented in 1992). The goal is to become the “BMW” of the wine industry; at the same time, a “global convergence” viewpoint will be adopted in marketing the wines falling under the new BRL Hardy brand. Local responsiveness should be replaced with a consistent global brand (labelling, brand marketing) (as originally suggested by Millar and Davies) in order to fully exploit the “cross-border synergies”..

Pillar 1: 1-3 year strategy

The strategy for BRL Hardy in the next 1-3 years is for BRL Hardy to “shrink to grow”. BRL Hardy should pull all control back to Reynella head office in the short term while the strategic blueprint is finalised; at the same time continue selling into low price/high volume segments already being addressed by BRL Hardy (e.g. U.K., Scandinavia) using brands other than BRL Hardy such as the D’istinto brand. Once the dimensions of the “global” BRL Hardy brand are determined, a period of internal marketing should be undertaken to “sell” the idea to employees; without buy-in from employees the vision will remain out of reach. At the same time, market research should be undertaken to determine the current level of customer “awareness” within various markets especially the growing US market, and possibly looking to Asia, Middle East.

Pillar 2: 2-5 year strategy

Launch the premium BRL Hardy wine; this wine should be made from Australian grown grapes. Initially sales could be within Australia (a fairly developed consumer wine market). Slowly look to introduce this