SMEs’ Gradual Growing Strategy: strategic options in the wine business

In the last two decades, the national and international wine competitive scenario has undergone several changes, which have compromised the traditional role of Italy as a leading country in the production of wine. The Italian wine industry is characterized by the strong presence of small firms, mainly family, in which a thorough strategic planning aimed to maintain or improve competitive advantage is marginal. This results in a lack of financial, managerial and cognitive resources. The pace of changes and the lack of tangible and intangible resources in small wine firms make it critical for them to reconsider their growth strategies. Based on these considerations, in this study we propose a possible strategic path, the Gradual Growing Strategy, for small businesses operating in wine industry. Selecting a sample of 110 small wine firms, we identify the ‚Alone‛ firms, characterized by complete autonomy and, based on the presence of personal and/or corporate ties, the ‚Independent‛ firms and the ‚Affiliated‛ to a Business Group or a Family Business Group. We conduct an analysis on performance of firms so categorized, in order to compare them. The analysis highlight that ‚Independent‛ firms have higher performance than ‚Alone‛ ones and in general that firms ‚Affiliated‛ to BGs show a better trend. Therefore, this study outlines a possible strategic path: from ‚Alone‛ to ‚Affiliated‛ to a BG, passing through the halfway stage of independence.