Case Study: Bauli’s Panettone 

When running a business, there is a decision on either expanding or remaining as a small 

organisation. Some business owners desire to remain small as it limits how much work they 

have. However, some companies like Bauli choose to make their businesses big which come 

with various benefits. Some advantages of being a big business are their survival, becoming a 

big business reduces the chance of failing or being taken over by another company. Bauli is 

already popular in European markets and they have a growing demand for their panettone in 

American markets, meaning that they have a high chance of survival. In addition, another 

benefit of a big business is the economies of scale which converts into greater profits, higher 

returns and a better balance sheet. Bauli produces 12 million panettoni every year which is 

on an industrial scale, meaning that their profits will be greater than a small business due to 

the fact that they have a bigger production, meaning they can sell more. Furthermore, big 

businesses tend to have a higher status which can attract employees as the company can 

provide a status to their employees. The higher status can also motivate managers and their 

employees thus making it easier for Bauli to employ the needed amount of people in the 

time span of four months they use to produce the panettone as people like the status given 

by working at Bauli. Big businesses also have the advantage of having a market leader status 

meaning they lead the market and habits which gives them a great advantage. On top of this, 

they have an increased market share which helps them control the market by deciding 

prices. Bauli has a larger market share due to buying subsidiaries from Nestle meaning that 

Bauli control the market of panettone. Bauli has also made significant technological 

innovations through using their investments in technology which allows them to get ahead 

of small businesses by improving the quality of their own panettone and selling them for $8 

instead of $30 like small businesses do. However, there are also advantages of a small 
business as small businesses have greater focus. Because of this, small businesses can invest 

where they want or where they think there will be the greatest profit outcome. Bauli, a big 

business has to work on several different things at once such as investors, branches and 

market share meaning they don’t have the same focus small businesses have. Small 

businesses have a sense of greater prestige and exclusiveness versus a large business, leading 

to the small businesses being able to charge more for their products leading to a high profit. 

Because Bauli produces their panettone on an industrial level, they will not be able to charge 

as much for their product. The prestige that comes from small businesses can motivate 

workers through the concept that they really matter to the business leading to greater 

efficiency. Bauli has over a thousand workers which thus makes it challenging to show that 

each individual employee matters to the business. 

**Sorry for the late work, my school account wasn’t working so I had to go talk to IT during 

lunch today and they fixed my account.**