Case Analysis - the Body Shop

SUMMARY OF THE BODY SHOP INTERNATIONAL With a £4,000 bank loan, Roddick developed a line of 25 skin and hair care products based on natural ingredients. Sourcing exotic ingredients like jojoba oil and rhassoul mud from a local herbalist, she prepared the first product batches on her kitchen stove and packaged them in the cheapest containers-urine sample bottles. Handwritten labels provided detailed information about the ingredients and their properties. A local art student designed the logo for £25. After a successful summer, Roddick exchanged a half share in her fledging business for a £4,000 investment by a local businessman, funding the opening of a second store. In April 1977, when Gordon returned, he hit upon the idea of franchising as a way to continue expansion of limited capital. When the first two franchises in nearby towns succeeded, the Roddicks began receiving calls from other interested parties. The business began to take off. From a single storefront in 1976, the body had grown to 576 shops by 1991, trading in 38 countries and 18 languages. Worldwide retail sales from company stores and licensees were estimated at $391 million. Along the way, the body shop was voted UK Company of the Year in 1985 and UK Retailer of the Year in 1989. in addition, Roddick had been the Veuve Cliquot Businesswoman of the year in1985 and Communicator of the Year in 1987. In 1988, she was awarded the prestigious Order of the British Empire by Queen Elizabeth. In 1988, with over 200 stores in 33 countries, the Body Shop finally committed to a 50,000 square foot production and warehouse facility in Morristown, New Jersey. Under the direction of a British expatriate, who was previously the president of Unilever’s fragrance subsidiary, 12 company-owned shops were opened on the East Coast. Total investment succeeded £10 million. In mid 1990, the company began franchising, and by year’s end, 37 shops had been opened.

THE MARKET
Famous for creating a niche market