Brl Hardy: Globalizing an Australian Wine Company

Topics: Management, Strategic management, Price Pages: 3 (737 words) Published: November 13, 2008
The roots of BRL Hardy’s success lay in global expansion. The company’s strategic vision is to become the world’s first truly global wine company. As CEO and managing director of BRL Hardy Europe, Carson’s contribution and achievements had been significant with a 10 fold increase in sales volume, in a tenure spanning just seven years. He successfully turned around Hardy’s U.K. business by implementing cost cutting initiatives and ensuring strong systems, policies, and control. Millar, CEO and managing director at BRL Hardy followed a decentralized approach to management. He believed in delegation and adequately integrated culture and management style into the merged corporation.

The U.K. market contributed significantly to BRL Hardy’s revenues and represented 40% of Australian wine exports. In U.K., the fighting brands, namely, Stamps and Nottage Hill, were positioned at price points of 2.99 and 3.69 pounds respectively. As low price good quality wines, they accounted for 80% of the value and volume of the Hardy brand sales. As the image of these brands began to erode, Carson decided to relaunch them by relabeling and repositioning the wines. Carson insisted that sales performance in U.K. depended on efficient labeling that should not be completely dictated by the Australian management. Although management was skeptical about local control over branding, labeling, and pricing decisions, the move significantly boosted the fighting brands’ sales.

As the fighting brands gradually moved up the price points, there was an opportunity for an entry level wine that could be priced lower than 4.49 pounds. In line with the company’s vision of becoming an international wine company, Carson decided to tap non-Australian wine sources and develop a line of branded products that could utilize the company’s strong distribution channels. This strategy would provide vital scale economies, minimize harvest risk, capture rationalizing suppliers, and avoid currency-driven...
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