Case Report:

BRL Hardy: Globalizing an Australian Wine Company

Kemal Güler

Uğur Sağıroğlu
 BRL HARDY: GLOBALIZING AN AUSTRALIAN WINE COMPANY

The main concepts in the BRL Hardy: Globalizing an Australian Wine Company case were;
internationalization, entrepreneurship, implementing strategy, and organizational structure.
Below, all of these 4 concepts will be discussed.

Entrepreneurship

Being an entrepreneur means being the one who takes an endeavor. Entrepreneurs assemble
resources including innovations, finance and business acumen in an effort to transform
innovations into economic goods. This may result in new organizations or may be part of
revitalizing mature organizations in response to a perceived opportunity. The most obvious form
of entrepreneurship is that of starting new businesses. According to Joseph Schumpeter, an
entrepreneur is a person who is willing and able to convert a new idea or invention into a
successful innovation. Entrepreneurship employs what Schumpeter called "the gale of creative
destruction" to replace in whole or in part inferior innovations across markets and industries,
simultaneously creating new products including new business models. In this way, creative
destruction is largely responsible for the dynamism of industries and long-run economic
growth[1]. He also adds that, entrepreneurship can also be a combination of currently existing
inputs.
In the case BRL Hardy: Globalizing an Australian Wine Company, we can see an example of this
final comment. After proposing a merger with Hardy, the CEO of the merged company, Steve
Millar makes a statement about the strategy of the merged company: “becoming one of the
world’s first truly wine companies”. At that time, there were no really established global wine
companies. They were trying to be the “first real global wine company”, so this was a new
concept in the sector, also a good example of entrepreneurial spirit.

Implementing Strategy

One of the most important elements of being a successful company is creating right strategies
and implementing them correctly. In the case BRL Hardy: Globalizing an Australian Wine
Company, we can see one of the best examples of strategy creation and implementation. While
creating a good company strategy, the most important point is to be aware of the strengths. In the
case, the merged company has had 3 core strengths: their world-class production facilities, their
global brands, and their international distribution. They have combined their strengths with a
good organizational structure, and made a successful implementation of their strategies.

Organizational Structure

While forming the new company’s executive team, CEO, operations and technical director, and
the international trading director came from BRL. In this merger, BRL was the one who is
bringing access to fruit, funds, and disciplined management. As they were good in management,
the new executive floor mostly composed of former BRL managers. Only the business
development director and the Australian sales and marketing manager of Hardy survived as
members of new executive floor. This was a logical decision. Both sides were bringing their
expertise, and this will be a benefit for the newly merged company.

Similar examples can be seen during past years. Not only in mergers and acquisitions, but also in
joint ventures; similar examples can be seen. For example; in 1997 Sabanci Group and Danone
have established a joint venture[2]. In that case; Danone was bringing their expertise, knowhow,
and skills. On the other hand, Sabanci was bringing their marketing expertise and dominance in
Turkish market. The executive floor of the firm has than formed in the light of these facts. As
consequence; they have achieved to form a successful joint venture and both sides made profit
from this joint venture.

Internationalization

The main strategy of BRL Hardy was to be an “international wine company” with worldwide
product access backed by the marketing capability and distribution muscle to create global
brands. For this purpose, making a merger was one of the major steps to be taken. It was a win-
win situation for both BRL and Hardy. BRL was good on accessing to fruit, funds, and
disciplined management. On the other hand, Hardy was bringing marketing expertise, brands,
and winemaking knowhow. Instead of putting millions of dollars and making investment, they
were coming together. Moreover, this merger could also be meaningful in terms of fattening the
gross margin. Together they have achieved both to direct material by BRL, and to required skills
and knowhow by Hardy. As a consequence, the result was a newly promoted brand which has
high sales volumes and market shares in Europe, Australia and US.
 References

[1] http://en.wikipedia.org/wiki/Entrepreneurship

[2] http://www.fundinguniverse.com/company-histories/Haci-Omer-Sabanci-Holdings-AS-
Company-History.html