Robert Mondavi Corporation Essay

5460 Words 22 Pages
1. EXECUTIVE SUMMARY……………………………………………..5

2. BACKGROUND OF THE CASE STUDY…………………………….6

3. ANALYSIS & IMPLICATIONS OF PORTER’S FIVE
COMPETITIVE PRESSURES……………………………………..7-17
3.1. The Potential Entry of New Competitors
3.2. Competitive Pressures from Substitutes Products
3.3. Bargaining Power of Buyers
3.4. Bargaining Power of Suppliers
3.5. The Rivalry among Competing Sellers

4. ANALYSIS OF THE STRATEGIC GROUP MAPPING……….18-20

5. KEY SUCCESS FACTORS OF THE WINE INDUSTRY………21-23
5.1. World famous growing areas
5.2. Larger growing market for premium wines
5.3. Favorable demographic and macro trends
5.4. Quality and affordable prices
5.5. Product
…show more content…
RMC employs a standard three-tier distribution system where the company sells to wholesalers who in turn sell to retailers who sell to the public. The company finds its niche in the “premium” and “ultra premium” segments of the table wine market (Burns et al., 2001).

In January 1999, Michael Mondavi, the CEO of the RMC and son of its founder, Robert Mondavi, announced the reorganization of the company and the layoff of 4% of the workforce. RMC had experienced a shortfall in supplying its Woodbridge Chardonnay brand. Unhappy distributors had begun substituting competing Chardonnay brands on retailer’s shelves. Yet, some distributors remained reluctant to carry the brand even though Woodbridge production levels returned to normal and further reducing company sales (Thompson & Strickland 2003).

During this period, the senior management was completing the process of reconfiguring RMC’s future strategies. However, there were two different views had aroused: (i) one group argued for a return to the original vision, complaining that RMC had been so busy focusing on launching new brands and pursuing international ventures that it had neglected its core domestic brands, which made up 90% of revenues, and (ii) another group claimed for continued diversification through its global partnerships in Chile and Italy and one domestic brand. Michael Mondavi was caught between the two groups (Silverman et
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