Babson Case Number: BAB123| Length: 28 Pages

Abstract

Lenta is a cash and carry retail business located in St. Petersburg, Russia. At the time of the case, it was operating nine stores and generating over $500 million in gross sales. The case is set at the end of 2005, after a very successful year. Lenta’s founder and CEO, Oleg Zherebtsov, is faced with a dilemma. Where does he take Lenta from here?

This case teaches strategy, entrepreneurship, risk assessment and corporate culture all within the emerging business environment of the Russian Federation. This case is best suited toward the end of a strategy course or part of a capstone course at either the undergraduate or graduate level.

The case requires the students to consider how their choices and decisions affect multiple disciplines within a corporation. If Lenta decides to continue to grow, there are financing issues that have to be faced. Also, where is Lenta going to find the additional employees needed to staff and manage the new stores? Can they find people who will be committed to Lenta’s corporate culture, as noted by its Mission Statement and Values? If Lenta expands outside of St. Petersburg, what operational and distribution issues do they face and how do they establish a brand name and image in their new market?

In addition the case introduces the nuances associated with operating in a dynamic emerging market where the best decision that may exist in a market like the United States is not the best decision within the Russian market. Students need to be aware of the idiosyncrasies of operating in a business environment that is likely different from their own.