Beardo’s strategic partnership with Marico

Abstract

Learning outcomes • The students will be able to compare various perspectives and concepts of strategic alliance as a tool of corporate expansion. • The students will be able to identify the trade-offs between financial and non-financial gains and losses for corporate expansion. • The students will be able to identify strategic partnership as a better alternative in comparison to acquisition and vice versa according to the different situations being faced by the companies. • The students will be able to identify different approaches for brand building. Case overview/synopsis Shah and Valani, owners of Zed Lifestyle Pvt Ltd which owned Beardo, had to decide whether they should accept the offer of a strategic partnership with Marico Industries, a fast-moving consumer goods company (FMCG) in the global beauty and wellness space. Marico nurtured leading brands across categories of hair care, skin care, edible oils, healthy foods, hygiene, male grooming and fabric care. The decision was not easy as Marico was a leader in the FMCG segment in India and had a strong brand presence in both online and offline distribution channels. Beardo, on the other hand, had its presence marked mostly on the online channel with a hundred offline salon outlets. Partnering with Marico would ensure access to the massive distribution channel owned by Marico but, on the other hand, would lead to possible loss of independence and an early exit from their business. They were not prepared to let go of their ownership as there was no clarity on what would happen if the projected growth figures were not met. There were many other questions too that crossed their minds which had to be answered before they decided on a yes or a no. The case highlighted the decision dilemma faced by the brand owners, the market scenario, competitive landscape and the situational facts so as to help the students critically analyse the decision situation and develop decision-making competencies by evaluating the possible course of actions and their possible outcomes. Complexity academic level Corporate-level strategies. Supplementary materials Teaching notes are available for educators only. Subject code CSS 11: Strategy.