Abstract

The Benetton family had its humble beginnings in a small town selling handmade sweaters. The handmade sweaters business gradually became a highly successful international clothing business. After achieving such success, in the late 1980s the family began diversifying into various other businesses. The family had set up Edizione Holding, a holding company, which held their clothing business run by the Benetton Group and all the other businesses they acquired. The case examines each of these diversifications and how they have fared. It looks into the issues each of these companies have faced and how they have dealt with them. Particularly, the case examines the problems Edizione holding faced with the Competition Authority, on diversifying into the motorway catering business and highway operation and management businesses.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• A successful company’s management of diversifications unrelated to its core business
• The risks of a perceived synergy between the core business and unrelated diversification failing to materialize.

Keywords

Case, Benetton Group, Edizione Holding, Benetton Sportsystem, Autogrill, Autostrade, Telecom Italia, 21 Investimenti, Italian Competition Authority, Benetton International Holding, United Colors of Benetton, Diversification, Organizational Culture, Host Marriott Group, Unrelated Diversification and Synergies