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Summary:

Our project was based on The Body Shop International, which is a PLC operating on a worldwide scale. We chose to carry out this project on The Body Shop as it has a very interesting background; it was founded as a natural soap and lotions company whose cornerstone was to operate as a model of social responsibility with ethics in business. However, The Body Shop has since been exposed to negative press surrounding the controversial business ethics on which this 'green' company is based. Therefore it was interesting to analyse the effects the external environment has on The Body Shop and how the company and the owner, Anita Roddick, respond to and deal with these pressures.

Our project finds that political, economical, competitive, ecological and socio-cultural analysis can be used to analyse these external pressures. We did not include technological analysis in our study as it was very difficult to access this information. However, to carry out a more in depth analysis we also used SWOT analysis, which is a measure of the strengths, weaknesses, opportunities and threats of the business, in order to see how the external pressures influence the business and how they can react to them.

The project concludes that The Body Shop is facing several challenges from the external environment.

Company background

The Body Shop was established on 26 March 1976 by Anita Roddick, the founder of The Body Shop. The Body Shop set out to provide an environmentally-friendly, feel-good business with products ranging from body and beauty to hair and gifts.

The Body Shop rapidly evolved from one small shop in Brighton on the south coast of England, with only around 25 hand-mixed products on sale, to a worldwide network of shops. Franchising allowed for rapid growth and international expansion as hundreds of entrepreneurs worldwide bought into Anita's vision. Now famous for creating a niche market sector for naturally inspired skin and hair care products, the body shop now has over 1,900 outlets operating in 50 countries. The products sold in the outlets are made of natural ingredients from across the world, encouraging global and local trade.

As well as its famous "Against Animal Testing" campaign, The Body Shop also supports community trade, helps promote self-esteem, supports human rights organisations, and plays an important role in promoting environmentally friendly messages throughout the world.

The Body Shop introduced a generation of consumers to the benefits of a wide range of best sellers from Vitamin E Moisture Cream to the Tea Tree Oil range and Banana Shampoo.

Company Landmarks

The story begins

* 26th March 1976 - The Body Shop opens for business. The Body Shop brings the benefits of previously unheard of natural ingredients to the high street - aloe vera, jojoba oil, rhassoul mud, cocoa butter - and many more. In 1978 a kiosk in Brussels becomes the first overseas franchise in 1978. By 1982 new shops were opening at a rate of two per month.

The Body Shop takes off

* In 1982 new shops opening at a rate of 2 per month

Global expansion

In the 90s the Body Shop expands on the global level.

* 1990: just one year after launching in the USA, there were 2,500 applications for a franchise. Demand for The Body Shop product is vast, driving a geographical expansion that saw the company trading in 39 countries only fourteen years after the first shop opened.

* 1994: The Body Shop At Home, the direct-selling arm, was launched in the UK in 1994, Canada in 1995 and Australia in 1997. Today in the UK alone, there are over 3000 consultants who introduced 940,484 customers to The Body Shop and its product at 103,762 parties in 2000/2001. Spring 2001 sees the launch of The Body Shop At Home in Ireland and the USA later in the year.

* The Body Shop continues to increase its environmental practices. The Body Shop invested a 15% stake in a wind farm in Wales in 1994 to help offset electricity used in its UK operations. In 2001, The Body Shop UK region and service centre head offices switched to Ecotricity providing them with energy from renewable sources. In addition, 127 of The Body Shop UK stores have now converted to green electricity with the rest of the stores due to follow suit.

* 1995: The New Academy of Business, an initiative of Anita Roddick, was established in 1995. The innovative management degree, addressing social, environmental and ethical issues, is run at The University of Bath.

* 1997: The Body Shop was the first international cosmetics company to sign up to the Humane Cosmetics Standard supported by leading animal protection groups. Also The Body Shop celebrated its 21st birthday with the launch of a new flagship store design which won the prestigious Retail Week Store Design of the Year Award.

* 1999: The Body Shop created four new business units in the UK, Europe, the Americas and Asia, shifting its operational and management structure out to the regions. The change was implemented to focus more of their resources closer to the markets and to create a more flexible and efficient operating structure across the Group. It is believed that this decentralised structure will significantly enhance The Company's ability to deliver a tailored offer to their customers faster and more efficiently.

Then...

* 2000: The Body Shop Human Rights Award was launched to media, non-governmental organisations and the public in June 2000. The Award has been set up to seek out and recognise individuals and grassroots organisations focusing on social, economic and cultural rights. Every two years, The Body Shop Human Rights Award will acknowledge community based projects around the globe, giving them not only recognition, but also practical and financial help. The theme for the 2000 Award was child labour and its role in denying children, particularly girls, and basic education.

* In 2000/2001, The Body Shop purchased over Ј5 million worth of natural ingredients and accessory items through the Community Trade Programme including nearly 400 tonnes of natural ingredients.

* 2001: