The Grundig Story
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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The New Owners
In July 2003, the district court of Nuremberg declared Grundig insolvent and initiated the insolvency procedure. Beck, who had earlier been chosen as the temporary insolvency administrator, was now appointed as the insolvency manager. It was announced that the profitable sections of the company such as its car radio, dictating machines etc would be sold to individual investors. The court also announced that there were prospective buyers even for the loss-making sections of Grundig...
Beko Electronik A.Þ (Beko) was founded by Vehbi Koc, in September 1966 in Istanbul, Turkey under the name of Bekoteknik Sanayi A.Þ. It was renamed in 1996. Over the years, Beko has grown to become one of the largest manufacturers and marketers of TV sets, DVD players, cash registers, satellite receivers, etc. in Europe.
Alba reported that for the eleven-month period (May 01, 2004 - March 31, 2005), since it jointly took over Grundig, the turnover for the German company was € 197.8 million and profits before tax were € 3 million. Analysts were of the view that Alba's proven skills in logistics, product range planning, and marketing had made a measurable difference to the fortunes of Grundig, as evidenced by its profits. However, the consumer electronics market in Germany and the rest of Europe was gloomy...
Exhibit I: A Brief Note on Philips