Harvard Case - From Beirut With Love (A)
"From Beirut With Love (A)" Harvard business case study is written by Christina R. Wing, Esel Cekin, Samer Al-Rachedy. It deals with the challenges in the field of General Management. The case study is 25 page(s) long and it was first published on : Sep 14, 2018
At Fern Fort University, we recommend that Nour El-Khoury pursue a strategic expansion plan for 'From Beirut With Love' (FBL) by leveraging its unique brand identity and expanding into new international markets. This strategy should prioritize sustainable growth while maintaining high-quality standards and ethical sourcing practices.
2. Background
This case study focuses on Nour El-Khoury, a talented entrepreneur who founded 'From Beirut With Love' (FBL), a successful artisanal food company specializing in traditional Lebanese sweets and desserts. FBL initially catered to the local market in Beirut, Lebanon, but its popularity quickly grew, leading to opportunities for expansion. Nour faces the challenge of balancing rapid growth with maintaining the brand's high quality and ethical sourcing practices while navigating the complexities of international business.
3. Analysis of the Case Study
SWOT Analysis:
Strengths:
- Strong brand identity: FBL's authentic Lebanese heritage and commitment to quality ingredients resonate with customers.
- Passionate founder: Nour's dedication and entrepreneurial spirit drive the company's success.
- High-quality products: FBL's artisanal approach and use of premium ingredients create a distinct competitive advantage.
- Positive customer feedback: The company enjoys a loyal customer base and positive online reviews.
- Strong social media presence: FBL effectively utilizes social media to engage customers and build brand awareness.
Weaknesses:
- Limited production capacity: FBL's current production facilities may not be sufficient to meet growing demand.
- Lack of formal business plan: The company's growth has been organic, lacking a structured strategic plan.
- Limited financial resources: Nour's personal savings may not be enough to fund significant expansion.
Opportunities:
- Growing demand for artisanal food: Consumers increasingly seek authentic and high-quality food products.
- International market potential: FBL's unique offerings can appeal to a global audience.
- E-commerce platform: Online sales can expand FBL's reach and customer base.
- Strategic partnerships: Collaborating with retailers and distributors can facilitate market entry.
Threats:
- Competition from established brands: FBL faces competition from large multinational food companies.
- Economic instability in Lebanon: Political and economic challenges can impact FBL's operations and growth.
- Supply chain disruptions: Sourcing ingredients and managing logistics can be challenging in an international market.
- Cultural differences: Adapting products and marketing strategies to different cultures can be complex.
Porter's Five Forces Analysis:
- Threat of new entrants: Relatively low due to FBL's established brand and unique product offerings.
- Bargaining power of buyers: Moderate, as FBL's products are differentiated and customers value their quality.
- Threat of substitute products: Moderate, as consumers can choose other types of sweets and desserts.
- Bargaining power of suppliers: Moderate, as FBL relies on specific ingredients and suppliers.
- Rivalry among existing competitors: High, as FBL faces competition from both local and international brands.
Key Considerations:
- International business: Navigating legal, cultural, and logistical challenges in new markets.
- Corporate social responsibility: Maintaining ethical sourcing practices and supporting local communities.
- Innovation: Developing new products and adapting existing ones to meet diverse customer preferences.
- Operations strategy: Scaling production and distribution to meet growing demand while maintaining quality.
- Marketing: Communicating FBL's brand story and value proposition to new audiences.
4. Recommendations
1. Develop a comprehensive strategic plan:
- Market research: Conduct thorough market research to identify potential target markets, analyze competitor landscape, and understand cultural preferences.
- Product development: Explore new product lines or variations of existing products to cater to specific international markets.
- Marketing strategy: Develop a multi-channel marketing strategy that includes online platforms, social media, public relations, and partnerships with local retailers.
- Financial projections: Create detailed financial projections to assess the feasibility of expansion and identify funding needs.
- Operational plan: Outline production capacity, supply chain management, and logistics strategies for international markets.
2. Prioritize sustainable growth:
- Ethical sourcing: Maintain FBL's commitment to ethical sourcing practices and partner with suppliers who share similar values.
- Environmental sustainability: Implement sustainable practices in production, packaging, and distribution to minimize environmental impact.
- Community engagement: Support local communities in Lebanon and the new markets FBL enters through initiatives like fair trade practices and employee development programs.
3. Secure funding and partnerships:
- Seek investment: Explore options for securing investment from venture capitalists, angel investors, or other sources to fund expansion.
- Strategic alliances: Partner with distributors, retailers, or other businesses in target markets to facilitate market entry and leverage their expertise.
- Government incentives: Explore government incentives and programs that support small businesses and international expansion.
4. Build a strong team:
- Hiring and recruitment: Recruit talented individuals with expertise in international business, marketing, operations, and finance.
- Employee training: Provide training and development opportunities to equip employees with the skills needed to support expansion.
- Culture building: Foster a company culture that values diversity, inclusion, and ethical practices.
5. Leverage technology and analytics:
- E-commerce platform: Develop a user-friendly e-commerce platform to reach a wider customer base and facilitate international sales.
- Data analytics: Utilize data analytics to track sales performance, customer behavior, and market trends to inform decision-making.
- Social media marketing: Optimize social media marketing strategies to engage customers and build brand awareness in new markets.
5. Basis of Recommendations
These recommendations align with FBL's core competencies and mission of providing authentic Lebanese sweets and desserts while promoting ethical practices and sustainable growth. They consider the needs of external customers seeking high-quality artisanal products and internal clients who value a positive work environment. The recommendations also take into account the competitive landscape and the potential for international expansion.
The attractiveness of these recommendations is supported by:
- Increased market share: Expanding into new markets will significantly increase FBL's customer base and revenue potential.
- Brand recognition: International expansion will enhance FBL's brand recognition and create new opportunities for growth.
- Diversification: Expanding into new markets will diversify FBL's revenue streams and reduce its dependence on the Lebanese market.
The assumptions underlying these recommendations include:
- Continued demand for artisanal food: Consumers will continue to seek authentic and high-quality products.
- Favorable economic conditions: The global economy will remain stable enough to support FBL's expansion.
- Effective implementation: FBL will effectively implement its strategic plan and overcome any challenges.
6. Conclusion
Nour El-Khoury has a unique opportunity to grow 'From Beirut With Love' into a global brand. By leveraging its strong brand identity, prioritizing sustainable growth, and building a strong team, FBL can successfully navigate the challenges of international expansion and achieve significant success.
7. Discussion
Alternative Options:
- Focus on the Lebanese market: FBL could choose to focus on strengthening its position in the Lebanese market before expanding internationally.
- Franchising model: FBL could explore a franchising model to expand into new markets without significant capital investment.
- Acquisition: FBL could acquire an existing food company in a target market to gain immediate access to infrastructure and distribution channels.
Risks:
- Cultural differences: FBL may face challenges adapting its products and marketing strategies to different cultures.
- Competition: FBL may face intense competition from established brands in new markets.
- Economic instability: Global economic conditions could impact FBL's expansion plans.
Key Assumptions:
- Continued demand for artisanal food: The global market for artisanal food products will continue to grow.
- Effective implementation: FBL will effectively implement its strategic plan and overcome any challenges.
- Financial resources: FBL will secure sufficient funding to support its expansion plans.
8. Next Steps
Timeline:
- Year 1: Conduct market research, develop a strategic plan, and secure funding.
- Year 2: Launch operations in one or two target markets, focusing on e-commerce and strategic partnerships.
- Year 3: Expand into additional markets, refine operations, and build a strong team.
Key Milestones:
- Secure investment: Secure funding to support expansion.
- Develop e-commerce platform: Launch a user-friendly e-commerce platform.
- Establish strategic partnerships: Partner with distributors and retailers in target markets.
- Launch operations in new markets: Begin selling FBL products in new markets.
- Expand product lines: Develop new products or variations of existing products to cater to specific international markets.
By following these recommendations and taking a strategic approach, 'From Beirut With Love' can become a global success story while upholding its commitment to quality, ethics, and sustainability.
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Case Description
This case describes how Robert Fadel, CEO and chairman of ABC, one of Lebanon's leading retail and real estate groups, professionalized the family business. Robert was the second son of the company's founder, Maurice Fadel, who had run it single-handedly. Concerned that the business might be affected by rivalry between his four sons after he died, Maurice set up a trust in 2002 that designated Robert as his successor, and in May of 2009, Maurice revised the trust, granting Robert full control of the board as well. In June 2009, Maurice Fadel passed away, and according to the provisions of the trust, Robert became the chairman and CEO of ABC for a period of five years, with the possibility of extending his term by an additional three years, on condition that he had the support of at least one of his brothers. In his new role, Robert set two main goals for the company. First, he wanted to turn ABC into a professionally managed organization at all levels. Second, he wanted to invest in long-term projects that would expand the business. Actualizing his vision was not an easy task given the family conflicts and Lebanon's economic and political environment. However, Robert achieved both of his goals by the end of his eighth year, in 2017, when he stepped down as ABC's CEO. The dilemmas at that point were whether he should appoint someone from outside the Fadel family as ABC's new CEO, and whether he should step down from the board chairmanship.
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