Mainfreight Case Study

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Mainfreight Group – Mighty Oaks from little acorns grow
A case study of a New Zealand Multinational’s Foreign Market Entry Strategy

Mainfreight – Mighty Oaks from little acorns grow.
This case study examines the strategies Mainfreight Limited has exploited when entering foreign markets. It examines Mainfreight’s successes and failures and investigates whether its market entry strategies played a significant part in these experiences. The Mainfreight Group market themselves as a global logistics provider offering “managed warehousing and international and domestic freight forwarding” (Mainfreight, 2013). As of 2013 Mainfreight Limited is operating in over 14 countries in four continents. Originally a domestic freight provider, the company now specializes in providing a large variety of services common to global logistics providers such as domestic haulage of both full and part loads, International Air services, International Sea Container services, Contract Warehousing and Supply Chain Management as well as other service offerings not commonly associated with global logistics providers including “Fashion Services, Canadian Transborder Logistics Services and Entertainment Media Logistics”(Linkedin, 2013). Mainfreight generally focuses on target areas they identify they can add more value to than “simple cartage” (Massey University, 2009) Mainfreight attribute their success to their unique culture, stating on their website that they “have developed a style of doing business, successful not only in New Zealand, but around the world”. Whilst this is a bold statement, Mainfreight has had some great accomplishments. Their success hasn’t been an accident and this mighty oak was once a little acorn. Since its inception in 1978, Mainfreight has grown significantly and is often cited as one of New Zealand’s most successful companies (Otago Business School, n.d.). Founded by Bruce Plested with $7,200 (Mainfreight, 1996) “and a 1969 Bedford truck” (Fairfax NZ News, 2008) Mainfreight’s business quickly expanded. Neil Graham joined Plested in 1979 as Joint Managing Director and opened their first Christchurch Branch. Growth continued and Mainfreight soon developed “New Zealand’s most extensive [domestic] freight network” (Mainfreight, 2013) by using coastal shipping to get around draconian laws that required “all freight travelling on land a greater distance than 150 kilometres to be moved by rail.” (Mainfreight, 1996) Mainfreight Founder Bruce Plested

“By the time land transport deregulation occurred in 1985, we were hardened and experienced after 8 years competing against the system and the giant transport companies. With the playing field almost levelled we were the fittest players, and our company was evolving a deep culture and a vision of what we could achieve”

“By the time land transport deregulation occurred in 1985, we were hardened and experienced after 8 years competing against the system and the giant transport companies. With the playing field almost levelled we were the fittest players, and our company was evolving a deep culture and a vision of what we could achieve”

Complementary to the company’s special culture Plested believed that some of the company’s success could be assigned to its agility and responsiveness to change, stating in Mainfreight’s 1996 prospectus;

Revenue exceeded NZD$10 million for the first time in 1984 and the first Mainfreight International branches, 50% owned by the Mainfreight Limited in conjunction with their managers opened in Christchurch and Auckland also opened. (Mainfreight, 1996) 1989 saw the opening of Mainfreight’s first Australian branch in Sydney with a view to offering services that “would allow customers to treat New Zealand and Australia as one market” (New Zealand Management Magazine, 2007). Mainfreight International Branches also...
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