Case Studes in Entrepreneurship, Family Businesses, Social Entrepreneurship

Code :ENT0019C

Year : 2006

Industry :Home Appliances and Personal Care Products

Region : USA

Teaching Note:Available

Structured Assignment :Not Available

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Introduction: The Body Shop was a pioneer of natural personal care products in the UK founded by Anita Roddick in 1976. The products were made with natural ingredients that were sourced through the company’s Community Trade Programme and were not tested on animals. Throughout the 1980s the company and its products enjoyed phenomenal global growth and a great demand to set up franchises. In 1999, it was voted the second most trusted brand in the UK by the Consumers Association. Anita Roddick, the entrepreneur behind this success, was actively involved in various social and environmental campaigns across the world.

But since the mid 1990s, the equity and good will of the brand suffered. The company was accused of making false claims about its products. The company also lost market share with the entry of newer players and competition from cheaper natural products. There were also franchise related problems and the Body Shop was accused of following a dictatorial approach towards its franchisees. By 2004, the company sales in the UK, which had been flat for the last year, started dipping. There were problems in the US market too. Anita herself described the Body Shop as ‘dysfunctional’ and analysts opined that the company as an innovator and ethical player was a ‘dead concept’. There was also criticism about Anita’s success as a socially responsible entrepreneur.

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