MGMT 495: The Business of Italian Lemonade

Professor Michael Miller’s MGMT 495 class has been studying the environments in which businesses operate. How does a firm situate itself among a variety of factors - economic, demographic, social, legal and technological - and turn challenges into strategy? In the context of globalization and international business, the problems are complex, and the questions multiply quickly.

For a little break, Professor Miller took the class on a field trip to Mario's Italian Lemonade on Taylor Street to find out what the business environment looks like for a family-run neighborhood shop. What makes up Mario's DiPaolo's external environment? For example, the lemonade stand has kept the same simple storefront and facade for over fifty years. As Taylor Street has gentrified, politicians and new business owners have used every means to pressure Mario into changing it, which he’s had to resist in order to do business as he wants.

Lawyers have also pressured Mario, in this case to franchise. On summer days, people come from across Chicago to wait in lines that stretch across whole city blocks. Mario has resisted this as well, along with a number of other changes - new branding, new recipes, new equipment, a webpage and much else, all as part of a strategy he’s been honing for years.

Everything about the business, Mario says, is done for the customer. People come back summer after summer; in some cases, he’s seeing the third generation of Mario’s customers visit the stand, kids from families he’s known for his whole life.

As his customer base grows, so does his revenue, but rather than expanding, he puts the money into a good life for himself, his family and his staff (who are, in many cases, family or friends of family). He’s bought a few properties on the block and taken a few vacations, but he hasn’t expanded Mario’s. Keeping it simple - just the way it is - gives him the energy and good nature for a quality of customer service unimaginable in other businesses.