BCH TELECOMMUNICATIONS
Marlene Mints Reed, Samford University
Rochelle Reed Brunson, Alvin Community College
Case Objectives and Use
This case was developed to illustrate the difficulties often encountered by American entrepreneurs while launching ventures in another country. The problems in this case are compounded by the fact that the country is the Czech Republic which is attempting to establish a free market system after the fall of Communism. The slow movement to a market economy, the lack of appropriate contract law, and the prevailing monopoly of Czech Telecom are all obstacles with which this telecommunications company must deal. A potentially devastating problem this entrepreneur must face is the fact that his trusted friend and partner has left the country with all of the company’s liquid assets and its legal documents. An additional focus of the case is the analysis of the product life cycle of callback services, a new method of reducing the cost of international telephone calls.
The case was developed for an undergraduate Entrepreneurship course, but it could be used in a course in International Business or International Marketing.
Case Synopsis
The BCH TeleCommunications case opens with the realization by Jeff Welker, one of the founders of the company, that his trusted partner and friend has left the Czech Republic (where the company is based) and has taken all of the company’s liquid assets and legal documents with him. As Jeff attempts to deal with these problems, the reader is led through a series of events in Jeff’s life that have led him from the beaches of California to the Czech Republic and a successful telecommunications business. The enumerable problems encountered in attempting to establish a restaurant and bar in Prague and finally giving up on the project because of the ineffectiveness of the country’s contract law are unfolded as well as the events that led to the establishment of BCH TeleCommunications, a company that represented WorldLink, a callback service provider. Jeff also speculates about the product life cycle of the company’s primary product—callback services—in light of the growing number of substitute products that are less costly than traditional international telephone calls and the possibility that the domestic telephone companies in Eastern Europe may soon lower their long-distance calling rates to compete with callback services.
Contact Person: Marlene Mints Reed, Samford University, Birmingham, AL 35229.
Telephone: (205) 726-2542. Fax: (205) 726-2464. E-Mail: mmreed@samford.edu
MR. A’s VIDEO
Lynda S. Livingston, University of Puget Sound
Mark Fiegener, University of Washington at Tacoma
Case Objectives and Use
This case requires the student to evaluate a small business and to decide whether or not it should be purchased by a young couple. The case presents all of the data that was available to the potential purchasers. Critical examination of this data requires the synthesis of managerial, financial, accounting, and legal concepts, and forces recognition of the difficulty inherent in evaluating a situation when some desirable data is unavailable. The case offers a variety of potential focuses, and class discussion could be led toward environmental analysis and its role in strategy formulation, industry analysis, value-chain concepts and resource-based theory, and “niche-strategy” concepts. There is also a strong underlying quantitative component which could be emphasized as appropriate.
Because the case is fundamentally entrepreneurial, both the qualitative and quantitative aspects are crucial. The teaching note covers both. The qualitative discussion is targeted toward the early stages of a business policy course, but applications for a variety of management courses are highlighted. The quantitative material illustrates the applicability of the case to introductory and advanced finance and accounting classes.
Case Synopsis
June and Jerry Will had been searching for a video store for over a year, hoping to finally begin the creation of their own “entertainment emporium.” Their business broker had shown them a number of stores, but most had been far too expensive for the young couple. Recently, the owner of Mr. A’s Video, a relatively small business, had reduced his original asking price in the face of serious cash-flow problems in another of his video stores. He needed to find a buyer fast. Jerry and June had to evaluate the managerial, financial, and legal data on Mr. A’s and reach a decision quickly before this opportunity was lost.
Contact Person: Lynda S. Livingston, School of Business and Public Administration, University of Puget Sound, Tacoma, WA 98416.
Mail: 1500 North Warner, Tacoma, WA 98416
Phone (253)879-3471; Fax (253)879-3156; e-mail: llivingston@ups.edu
IS THIS ENTREPRENEUR’S BEHAVIOR ETHICAL?
Javad Kargar, North Carolina Central University
Case Synopsis
Over the last twelve years, Wave Systems Corporation, an entrepreneurial company has grown from a small start-up to an organization with 144 employees and almost no operating revenue. This case describes how Wave Systems has been managing the company to keep running in spite of little revenue for so long. Despite continuing growth in technology development and strategic relationships with some main Internet players, the company’s financial position has deteriorated in recent years, suggesting strategic problems. While the company is turning a big operating loss, raising additional capital to the funding of mass production and deployment of its technology is very critical. In year 2000, Peter planned to build the company’s infrastructure, manufacture and deploy the technology in over millions of PCs and other hardware devices. The case describes in detail the strategy, management, and operations of Wave Systems. Raging Bull message board played a major role in keeping the company alive. Both Chairman and President of Wave Systems participated in the online debate, a practice that made securities lawyers cringe. In 1998, the company even invited Raging Bull posters to its shareholders’ meeting. This case ends by asking whether Wave operates ethically. A major selling point of the company is the trust of the company’ technology, but do investors trust the founder, Peter? How can it continue its operations? Who should invest in the company, and what should be the fund raising strategy and sources for mass production and deployment of the company’s technology?
Case Objectives and Use
One of the main objectives of the case is to analyze the ethical health of Wave Systems Corporation, and debate on the management’s responsibility to the shareholders. This case also provides an opportunity to the students to analyze different alternatives for additional financing for the company’s aggressive deployment of its technology and implementation of its business model. The case may be used in a number of courses. It is relevant for Entrepreneurship course, where entrepreneurial behavior and finance issues may be emphasized. Strategic Management/Business Policy and Business Ethics courses could also use this case as the basis for discussing a variety of topics and issues, including industry analysis, business strategy, public trust, strategic implications, and business valuation. The case is appropriate for use with undergraduate at the senior level or in graduate-level courses.
____________________
Contact Person: Javad Kargar, School of Business, North Carolina Central University
Durham, NC 27707. (919) 560-6146, Fax: (919) 560-6163
DENTALL
Marilyn Young and Elizabeth Wimberly, The
University of Texas at Tyler
Case Objectives and Use
This case would be appropriate in the undergraduate classes of Management Consulting, Small Business Management, Marketing, or Entrepreneurship. The case is intended to shown the factors involved in starting a new business and developing a client base. The case illustrates how people with technical skills have difficulty in starting a business. Students will identify important factors in starting a new business. Also students will have an opportunity to evaluate a marketing survey.
Case Synopsis
Liz Wright is interested in opening a dental consulting firm. She has had experience as head of dental hygiene school at a local community college. She feels she has the talent, organization, and enthusiasm to help dentists improve their practices. While talking with dentists and reading, she perceives they need help in bookkeeping, billing and collections, and general office management.
She has developed a pricing policy and feels the best means of promotion is through word of mouth advertising. She decided to conduct a survey by using a mail questionnaire. The questionnaire was pretested and mailed to 100 dentists. She received a 49% response rate. Generally, the results from the dental community were positive and she is ready to begin her consulting firm. The survey also revealed dentists wanted help in training, time management, and billing and collecting. Many had used a consultant before, and the majority were satisfied with the service.
The case concludes by the Liz Wright asking a counselor if she should continue with the development of the business or not. If she should continue, what should she do next. The case has sections on competition, marketing, management team, and charts resulting from the survey.
_____________________
Contact Person: Marilyn Young, The University of Texas at Tyler, 3900 University Boulevard, Tyler, TX 75799. (903) 566-7438. E-Mail: myoung@mail.uttyl.edu.
CORPORATE INFO TECH
Computer Networking Gurus
Robert W. Hornaday
Case Objectives
and Use
The teaching objective of this case is to acquaint students with the trials and tribulations of starting a promising new venture. In common with many startups, the founder had a contract before he had a company. The evolution of this small firm during its first three years presents typical problems faced by new ventures including recruiting a good business manager, getting rid of an initial partner who was not working out and scrambling to maintain a positive cash flow. Students evaluate the long range plans of the owners and gain an understanding of the real world growth problems faced by new ventures.
The teaching note is designed for undergraduate small business and entrepreneurship courses. It will also be useful as an introductory case in graduate entrepreneurship courses. Included are an appropriate theoretical framework and sample discussion questions.
Case Synopsis
At age 14 Lawrence Cruciana was the youngest certified Microsoft technician – ever. Dropping out of college after two years he went to work installing a computer network for a small parts company in Charlotte, North Carolina. Loaned to a textile company to install another computer network in late 1997, Lawrence put in a winning bid to install a large network. He got a friend (Tom Brown) to help him assemble and test the components in his apartment, then install them at the Charlotte site.
To manage the business side of the venture, Lawrence enlisted Melissa Cooper, a business student who set up a corporation with Lawrence owning 33.4%. Tom and Melissa each held 33.3%. Problems with Tom began in August 1998. Finally, Lawrence and Melissa bought Tom out with a $17,000 loan from Melissa’s parents.
Selling is CIT’s biggest problem. Their customer base consists of their two the original customers. Neither Lawrence nor Melissa are good at direct sales. Technical certification by major network equipment manufacturers is very important to CIT. They leverage their technical expertise with existing customers to get repeat and referral business.
For the future, both owners want to increase sales. They believe that if they can get their sales up to $3-5 million, they will be able to do and IPO that will bring in $25-30 million in capital.
Contact Person: Robert W. Hornaday, UNC Charlotte, Charlotte NC
Mail: 5920 Oak Wielde Court, Charlotte NC 28227
Voice: (704) 547-4426; FAX (704) 547-3123; e-mail: rwhornad@email.uncc.edu
Howell Construction Company
Marilyn Taylor, MBA, DBA, Bloch School of Business and Public Administration, University of Missouri at Kansas City
Laura Linebach, MA, MBA, CIGNA HealthCare of Kansas/Missouri
Krishnan Ramaya, MBA, Ph.D, University of Southern Indiana
Case Objectives
· Understand the role of a small business entrepreneur operating in a highly competitive and fragmented market and the risks taken to attain business and personal objectives.
· Evaluate the option to lease/purchase and the viability of buying property.
· Examine issues associated with locating a small business in the inner city.
This case can be used in undergraduate, graduate and executive development classes. The case is recommended for use in both entrepreneurship and strategic management courses. It is recommended that this case be coupled with Michael Porter’s “Competitive Advantage of the Inner City” (Harvard Business Review, May - June 1995). The case can be positioned early in a course after the students have been exposed to the basic concepts of entrepreneurship or strategic management.
Case Synopsis
Howell Construction focuses on a female-owned and operated company with its offices in an inner city location near downtown Kansas City, Missouri. In the near-term owner and President Carol Howell faces the mid-1998 decision of whether to execute her lease option. She recently paid $2,000 for an appraisal. Excerpts of the appraisal and information about Kansas City plus the area in which the business is located are included in the case. Mrs. Howell moved her office into the area in 1995. She and her husband are Caucasian. The area is heavily Hispanic. Carol Howell and her husband Ed made efforts to become part of the neighborhood community during the first two years after they moved the office. However, during the last year there has been little interaction after negative reaction to their participation in neighborhood meetings. A series of robberies that occurred during the first two years after moving have ceased.
Longer-term Carol Howell targets to retire. The business and their personal residence are currently the couple's major assets. The case thus provides opportunity for assessing the strategy of the business, its longer-term viability and potential value, and Carol Howell’s approach to managing the firm, as well as analysis of the decision to stay in the urban core or explore another location.
___________________________________
Contact Person: Marilyn Taylor, MBA, DBA, University of Missouri at Kansas City, 5110 Cherry, Kansas City, MO 64110 816.235.5774 Fax: 816.265.2312 taylorm@umkc.edu
HEAT SAVER DISTRIBUTORS LTD.
Casey
Jones, B. Comm, University of Manitoba
Case Usage and Objectives
This case is suitable for use at the undergraduate or MBA levels in courses in Small Business Management or Business Strategy. It is also a good vehicle for discussion of the distribution function, as well as the issue of forward integration.
This case would be a good basis for a written assignment, in
that intentionally no decision alternatives are provided. This challenges the students to address a
daunting situation from the same discouraging starting point as the three
principals in the case. Thorough
analysis and imagination will generate a number of interesting options, and as
the teaching note indicates, the principals did indeed find a way to save their
business.
Synopsis
Heat Saver Distributors Ltd. (HSD) was founded in 1985 as a distributor of ventilation systems in central Canada. Early success led to expansion into the fledgling gas fireplace market as well as into the heating and air conditioning markets. Sales grew strongly at first, driven by the developing gas fireplace market, but leveled off in the mid-1990's. The current management team bought out the founding owner in 1995, and rekindled growth in both sales and profits.
At the point of the case, HSD’s management team had just learned that Union Energy, the large, retail subsidiary of a major gas utility in Ontario, had purchased a significant long-time HSD customer in Winnipeg, Manitoba, HSD’s home base. This followed its purchase of a major HSD competitor five months earlier. Furthermore, there were persistent rumors that Lennox, a major furnace manufacturer, would soon follow the same forward integration course into the Winnipeg market.
In fact the entire hearth industry was facing many changes. The relatively fragmented manufacturing industry for gas fireplaces was quickly being consolidated. Manufacturers were forward integrating by acquisition, and ignoring traditional distributor territorial rights by selling directly to dealers.
As purely a distributor in the industry, with no direct
involvement in retailing or manufacturing, HSD faced all these challenges and
must determine how to proceed to ensure continued viability.
________________________
Contact Person: Casey Jones; Mail:111 - 18 Passy Crescent, Toronto,
Ontario, CANADA M3J 3L3;Voice:(416)
310-2355; e-mail: caseyjones@canoemail.com
MISSIONAIR
Daniel Gendron, BA Psychology & BA Business Administration,
University of Regina
John Melnyk, University of Winnipeg
Case Objectives and Use
The case is an excellent vehicle for illustrating the theses of Henry Mintzberg’s, Crafting Strategy, (Harvard Business Review, July - August, 1987). The three owners of MissionAir are also its only three employees, and as such are intimately in touch with the day-to-day operations of their company. Their strategy emerges and is refined as they recognize and react to opportunities and problems. In that same article Mintzberg also makes the point that “To manage strategy... is not so much to promote change, as to know when to do so.” This is precisely the decision issue of the case: is it time to deliberately change strategy or not?
The case is suitable for use at either the undergraduate or MBA level, in courses on Small Business/Entrepreneurship and Business Strategy. The definite decision issues make it well suited to assignment as a written analysis, and possibly even a four-hour exam. At the MBA level, it could also be vehicle for discussing deliberate versus emergent strategies.
Case Synopsis
MissionAir is a charter air service based in Winnipeg, Manitoba. The company name reflects the strong Christian beliefs of its founder and CEO, Michael Graham. As of May 1999, MissionAir has been in existence for barely two turbulent years. On two occasions, only good luck saved them from dissolution, but the company has also suffered some bad luck—a crash that destroyed one of their two planes during their peak season.
Nevertheless MissionAir has persisted, and is now on the brink of profitability operating as an air charter service, primarily flying north from Winnipeg. However, Dan Rutherford, the marketing manager has thoroughly researched the option of starting a scheduled-shuttle from Winnipeg to a southern destination in the United States, either Minneapolis or Fargo. He has become convinced that the development of the service is the way to go, even though this would be a completely new direction for MissionAir.
Michael Graham is now contemplating whether MissionAir should continue with the status quo, which has not yet been profitable, but seems as though it could be, or take off in a new, unfamiliar direction which seems to hold great promise, but also involves greater risk.
Contact Person:Daniel Gendron Mail:71 Avril Lane, Winnipeg Manitoba, CANADA R3R 3C8 Voice:(204) 832-8807; e-mail: dngendron@hotmail.com
WALLACE ACCOUNTING AND COMPUTER SOLUTIONS:
MANAGING GROWTH
Betty L. Brewer, DBA
Chi Anyansi-Archibong, Ph.D.
Isaiah O. Ugboro, Ph.D.
North Carolina A&T State University
CASE OBJECTIVES AND USE
This
case focuses on a small business owner’s concerns about growing her firm. The issues in the case include expansion
decisions, recruitment and retention of qualified employees, changes in the
industry environment, and technology implications. The operational process and daily, as well as strategic, concerns
of the owner can be examined.
This case is designed to
direct student attention to the complexities of managing a small business
facing a variety of potential growth opportunities. Students should be able to discuss resource requirements for growing
the firm and potential obstacles to supporting and sustaining growth. The case will be most appropriate for
courses such as small business management, entrepreneurship, management
concepts, and business environment. The
case will be useful at the undergraduate level and for an honors level
management course.
CASE SYNOPSIS
The
Wallace Accounting and Computer Solutions case describes a small business
bookkeeping and consulting services firm.
Paula Wallace founded the firm as sole proprietorship in 1997, providing
either of two accounting services for its clients: full bookkeeping, excluding taxes, or monthly financial statement
preparation and review only. Accounting
services generated the bulk of the firm’s revenues.
Computer-related services
included conversion of manual accounting systems to software-based accounting
systems. Consulting services currently
involved advising clients about accounting system conversions and training
personnel when a new software system had been selected. More recently, clients had begun to request
advice on a variety of operational issues, such as expanding a business, how to
finance expansion, personnel policies, and marketing.
As her business grew, Ms.
Wallace recognized that she had some fundamental choices concerning the future
of her company. She saw many
opportunities for growth. However,
acquiring the resources needed to manage a growing organization, continuing
problems in attracting personnel for a small business, and changes in the
business environment affecting clients and accounting firms in general created
a complex decision situation.
Contact: Betty L. Brewer, Associate Professor, Business Administration, North Carolina A&T State University, Department of Business Administration, Merrick Hall, Greensboro, NC 27411. E-mail: brewerb@ncat.edu. Voice (336) 334-7656 ext. 4021.
FANTASTIC FLAVOR PRESERVES CO. LIMITED
Ruth Cruikshank
Tracy Hunt
Deborah Orzel
Case Objectives and
Use
This case highlights growth stage challenges for successful entrepreneurs, where a myriad of strategic and organizational decisions have to be made by founding owners. The case asks students to do some higher order management thinking, to get beyond simply answering problems raised in the case and to also recommend management processes for handling strategic thinking and planning in future.
The case takes the perspective of company owners. The Mathisons recognize that current market penetration is less than optimal in several parts of North America, and that their organizational systems will require improvements and investment to continue on the growth path -- but they are nevertheless buoyed by recent success and highly motivated to push the business further.
The teaching note has been primarily targeted for use in undergraduate courses in Entrepreneurship and Strategic Management. The combination of entrepreneurial issues with strategic management processes and strategy makes for rich discussion and learning potential.
Case Synopsis
Fantastic Flavor Preserves Co. is a specialty food products firm that has experienced success because of unique products and packaging design, and because of close fit with market trends. After four good years, however, the firm is close to being a victim of its own success. The owners, Jennifer and Ron Mathison, are faced with strategic growth questions that are fairly typical at this stage of early venturing: Which product(s) should be our focus for the future? What geographic markets should we target? How can we ensure that our marketing capabilities are "up to snuff"? Do we need to adjust our management structure? What about our personal involvement?
Another layer of consideration throughout the case is the personal involvement of the Mathisons. After the arrival of their first child, they find themselves with no disposable time for luxuries such as strategic planning for their firm!
_____________________________________
Contact Person: Dr. Ruth Cruikshank, Wilfrid Laurier University
Mail: 75 University Ave. West, Waterloo, Ontario, Canada N2L 3C5
Voice (519)-884-0710, ex. 2553; FAX (519)-884-0201; e-mail: rcruiksh@wlu.ca
CF
Technology, Inc.
John H. Friar, Raymond M. Kinnunen, College of Business Administration,
Northeastern University
Case Objectives and Use
This case describes strategic decisions facing a small high-tech company that looks for new market applications in which to advance, adjust, and apply technology already in the market place. Based on field research, this case is appropriate for courses in management of technology, small business, or entrepreneurship – at undergraduate, graduate, or executive levels.
Case Synopsis
CF Technologies, Inc. was a small company founded with the intention of pursuing advancements in technology. A major issue for CF Tech was advancing the technology far enough along to be evaluated by potential investors and partners. John Moses, President of CF Tech, had experienced past failures and wanted to make sure that the technologies being pursued would be brought to the market in the right form and with the appropriate financial and organizational backing. CF Tech was currently working on the development of three different technologies—one for Polyvinyl butyral (PVB) recycling, one for Aerogels, and one for developing supercritical fluids as cleaning agents. Moses wondered what the current and future demand for these technologies would be as well as the ease in which the current technology in the market could be altered and applied in these new areas.
CF Tech had three full time employees, including John Moses, and 12 part-timers. Many of the part-timers were chemical engineers who also worked outside of CF Tech as contractors. Since the company was founded in 1989, funding had been provided by Small Business Innovation Research (SBIR) contracts and outside companies who were interested in having technology developed for their various projects. SBIR was a federal program that awards contracts to small businesses to develop technology applications that individual government agencies were interested in having developed for commercial use. CF Tech employed two very talented engineers, one who worked with polymers processing technology and the other who worked with industrial cleaning equipment technology. Many of the developments made in these areas were the result of the two engineers and their small support staff.
It was January 1999 and John Moses knew that it was time to make a decision on which technologies to pursue and when to sell them. He wondered what strategies should be taken to maximize profit and growth but still give the company the greatest control over its products. Moses also wondered what were the strategic implications for PVB recycling, the current and future demand for Aerogels, and the potential for developing supercritical fluids as cleaning agents.
John Friar, Executive Professor and Associate Academic Specialist, General Management Group, College of Business Administration, 212 Hayden Hall, Northeastern University, Boston, MA 617-373-4784. Jfriar@cba.neu.edu
SMOKIN' BARRELS BBQ CHIPS
Andrew F. Durkee, Sonoma State University
Case Use and
Objective
The case can be used to demonstrate the challenges facing an entrepreneurial opportunity in a not-for-profit organization. All the elements of a for-profit venture are present, except the rewards are personal satisfaction and public recognition rather than monetary gain. The case has many opportunities for analysis, and many different paths to explore those opportunities. The case is designed primarily for the graduate business student in an entrepreneurship course.
The objective of the case is to prompt the generation of a financial planning model, with modest goals geared directly to sales. The analysis should propose ways to maintain sustaining competitive advantage and identify key factors for success. Threat of entry, industry rivalry and buyer power are all present to challenge the student. There is no core competence in the manufacturing of the product, so the analysis needs to look elsewhere for key success factors. Financial risk is minimum, but business failure means tighter control of trust funds and closer scrutiny of day-to-day operations.
Case Synopsis
Frank McAtee was Director of a teen probation camp in Sonoma County established in 1955 to provide an alternate residence for high-risk youth combined with work skills development. The camp offered skills training and an opportunity for young men to work in local industries while preparing to become productive members of the community. As an extension of the woodworking and welding instructional programs, the camp produced a line of park products for state and national park systems. This business grew from a few picnic tables a year to over 1300 tables and expanded to include an assortment of grills and fire pits.
Frank managed over 20 different rehab programs and needed funds to defray costs of transportation and lodging for youth competing in state and national skills contests.
The camp's Advisory Committee suggested a fund-raising venture to support the contests. The venture involved asking local wineries to donate used wine barrels which would be chipped to produce a flavored wood barbeque product. This for-profit venture could be established within a government organization using trust funds to start the business with an implied payback. All the business needs are present: suppliers, manufacturing, distribution, administrative support, marketing and sales. The real challenge is to gain local public recognition to sustain a positive interest in the camp and long-term support of the trust fund programs.
____________________________________________________________________
Contact: Andrew F. Durkee, Student, Sonoma State University, Rohnert Park, CA
Address: 6079 Della Court, Rohnert Park, CA 94928
Phone: 707-584-5109, Email: adurkee@pacbell.net
THE BEAN BARON
Thomas L. Lyon, Rockhurst University
Anthony L. Tocco, Rockhurst University
Case Objectives and Use
The Bean Baron case A and B are designed to be used
in an entrepreneurial or business strategy course. The student is encouraged to
look at this start up through the eyes of the entrepreneur and to assess both
the personal and business risks and rewards and to ask how well the entrepreneur
has balanced the opportunity, the team, and the resources necessary to
succeed.
Case A can also be used to stimulate career change
and development discussions. Cases B also lends itself to a marketing and
business implementation course. The cases
can be used effectively in undergraduate, MBA, and entrepreneurial development
programs or seminars like those offered at Small Business Development centers
and Entrepreneurial Centers. The cases are designed to be used in a sequence,
but could be used as stand alone cases.
Case Synopsis A
Danny O’Neill, a thirty-two-year-old sales executive with Weyerhaeuser Paper Company, was on the night train to Moscow in October of 1992, part of a not for profit mission to aid Russia develop capitalism. On his trip he realized how unhappy he was in his corporate career and he dreamed of starting his own business. Danny knew he had to identify an opportunity that he had passion for. He has narrowed his focus to starting a grand café and coffee roasting business in Kansas City Missouri. He is about to meet with Dick Benner, a SCORE advisor to get advice about his entrepreneurial ideas.
Case
Synopsis B
In
October of 1993, following much deliberation and considered good advice from
Dick Benner his SCORE advisor, many other contacts and coffee related visits,
Danny O’Neill started the Roasterie, a gourmet coffee roasting business in
Kansas City, Missouri. From 1993 to
1998 Danny continued to struggle to balance the opportunity, the team, the
resources, the fit, and timing of this business start-up. By 1998, Danny and the Roasterie had
received numerous awards for their socially responsible community work, which
also promoted and made the Roasterie a well-known name in Kansas City. His financial statements in 1998 demonstrate
his succeed in creating a successful local gourmet coffee roasting business
with more than $2 million of sales and profits of $200,000. Danny, although
successful in the local market with nearly 40% of the gourmet coffee roasting
business, knew he could accomplish much more. “I want to build an empire. When
we make the cover of Fortune Magazine,
that's when we'll stop." The challenge is how to move the Roasterie from a
successful local business to a regional, national, and even international gourmet
coffee roasting business. Danny faces a multitude of opportunities and related
risks as he tries to grow his company beyond the local market.
Contact Person: Thomas L. Lyon, Rockhurst University, Kansas City, Missouri 64110
Mail: School of management, 1100 Rockhurst Road, Kansas City, Missouri 64110 USA
Voice (816-501-4092; FAX 816-501-4650; e-mail thomas.lyon@rockhurst.edu
JORDAN’S FURNITURE
Raymond M. Kinnunen, James F. Molloy, College of Business
Administration,
Northeastern University
Case Objective and Use
This case, based on field research, describes the evolution of Jordan’s Furniture, a very successful family-owned company, which had revolutionized the way people sold furniture in the New England area. The two brothers, Barry and Eliot Tatelman, who started to run the business almost thirty years ago, reached nearly $250 million in sales in 1999. Warren Buffett made an offer to buy out the business. Students are asked to analyze what has made Jordan’s so successful in this industry, what differentiates Jordan’s from its competitors and how Barry and Eliot manage the company. The pros and cons of selling Jordan’s and the potential impact of selling the company on Barry and Eliot, their families, the customers and the employees are important issues that should also be addressed by the students. Jordan’s Furniture is a case appropriate for courses in strategic management/business policy and small business/entrepreneurship at the undergraduate, graduate and executive levels.
Case Synopsis
The retailing industry was highly fragmented, with hundreds of local retailers located inside the cities and major retailers being located outside the big cities. Jordan’s Furniture was one of the major players in New England, with three stores located in Massachusetts and one in New Hampshire.
Samuel A. Tatelman founded Jordan’s Furniture in 1918, when he opened a store in Waltham, Massachusetts. In the 1930’s, his son, Edward, joined him. In 1973, Edward’s sons, Barry and Eliot, took over the business. Barry and Eliot Tatelman changed Jordan’s from a staid family furniture store to an enormously successful operation by implementing the belief that furniture shopping should be fun. Jordan’s was projecting sales of $250 million for 1999 and had grown to 1,200 employees.
In May of 1999, Warren Buffett – CEO of Berkshire Hathaway and one of the wealthiest men in the world – was introduced to the Tatelmans and was very impressed with Jordan’s performance. A few days later, Buffett made an offer to buy out the business.
Contact Person: Raymond M. Kinnunen
Mail: 309 Hayden Hall, Northeastern University, Boston, MA 02115-5000USA
Voice (617) 373-4736; FAX (617) 373-8628; e-mail: rkinnunen@cba.neu.edu
WEST POINT MARKET CONSIDERS THE FUTURE OF
TRADITIONAL GROCERY
J.
B. Wilkinson, Youngstown State University
Gary
B. Frank, University of Akron[1]
Case Objectives and Use
This case illustrates a
repositioning strategy for an upscale food store. It provides students with a real-life decision situation
regarding store and merchandise expansion/restructuring. The decision can be evaluated against
financial and marketing risks. Specific
criteria suggested by the case are cost recovery, customer appeal, and current
trends in the food service areas in supermarkets. The decision also can be evaluated against strategic
"fit" with the store's mission, strategy, and market environment. Breakeven analysis and merchandise
performance measures can be used to assess cost recovery. Qualitative analyses regarding customer
appeal and strategic fit can be addressed through secondary information about
consumer eating trends, supermarket industry food service area trends, and
business positioning strategies.
The case was written primarily for
undergraduate courses in small business/entrepreneurship. The case may also be useful in other
business courses, including retailing and business policy.
Case
Synopsis
Russ Vernon, owner and manager of
West Point Market in Akron, Ohio, must decide whether or not to enlarge the
foodservice areas of his store, decrease traditional merchandise inventories,
and restructure/redesign several store areas.
If he undertakes the store expansion, he will be changing the image and
store concept/format of West Point Market from an upscale supermarket to a
"boutique eatery."
The proposed plan for enlarging the
foodservice areas of the store involves creating a 950 square foot Atrium cafe
addition to the store, expanding the deli and diary areas, and remodeling the
former cafe area to become a British Tea Room.
In order to accomplish this, frozen foods and traditional grocery
products will be de-emphasized through reductions in merchandise assortment and
store space. Cost of the project is
$737,300. Russ Vernon is concerned
about recovering the cost of the project through increases in foodservice
sales. Customer appeal is an important
issue; the supermarket industry has reported mixed results from supermarkets
that have experimented with their food service areas.
Advanced Fibre Communications and the Shroud of Turin
Armand Gilinsky, Jr., Sonoma State University
Case
Objectives and Use
The “Advanced Fibre Communications and the Shroud of Turin” case
illustrates how firms at different stages in the life cycle undergo
transitions. Students can compare and contrast Advanced Fibre Communications
(AFC), a maturing venture, with Turin Networks (Turin), a spin-off venture,
which is all speculative growth. AFC and Turin compete in the telecommunications
equipment industry, which provides infrastructure for the convergence of
telephones, computing, and the Internet. Instructors can use this case as:
1. An exercise in framing a strategic issue at an early stage of firm
growth;
2.
An
example of how venture capitalists place their bets on people, not business
plans;
3.
An
analysis of the risks and rewards of different “harvest” alternatives; and
4.
An
illustration of how entrepreneurs can act as a mentor to other entrepreneurs.
The case is primarily intended for an undergraduate or graduate-level Entrepreneurship course. It can be used midway through the course to cover concepts of industry analysis or later to stimulate discussion of the pros and cons of various harvest strategies. Instructors can use traditional strategy models such as Porter’s Five Forces analysis and SWOT analysis to help guide students. The case is based entirely on field research, supplemented by published data.
Case
Synopsis
The “Advanced Fibre Communications and the Shroud of
Turin” case is a story about an entrepreneur, Don Green, and his protégé, John
Webley, in fostering the evolution of “Telecom Valley,” a cluster of emerging
high technology telecommunications companies in Sonoma County, California.
Green had built businesses based on successive generations of digital switching
technology that enabled higher speeds and greater quantities of data to travel
over telephone lines. Since going public in 1996, Advanced Fibre Communications
(AFC) had become Green’s most recent and successful venture. By 1999, consumer
demand for increased connectivity, the rise of “virtual” ventures, and the
exponential growth of the Internet fostered a fertile field for spin-offs in
Telecom Valley. Other drivers included the quality of life in Sonoma County,
plentiful venture capital funding and a buoyant financial market for initial
public offerings (IPOs). Just prior to its IPO in 1999, Cerent, a two-year-old
spin-off, was purchased by Cisco Systems for $6.9 billion. Inspired by Cerent’s
success and unhappy about the leadership transition at AFC after Green’s
retirement, several engineers left AFC to start new businesses nearby. As
Webley commenced the startup process for his venture, Turin Networks, he
pondered how to apply Green’s lessons about entrepreneurial success, how to
contend with nervous investors who demanded to see a product that existed only
on paper, how to avoid lawsuits over engineers and intellectual property, and
how Turin Networks could be built to stand the test of time.
Contact Person: Armand Gilinsky, Jr., Sonoma State University, 1801 E. Cotati Ave., Rohnert Park, CA 94928-3609. Voice: (707) 664-2709; Fax: (707) 664-4009;
email:
Armand.Gilinksy@sonoma.edu.
The Weight Room
Randall D. Harris, California State University, Stanislaus
Case Objectives and Use
This case addresses both the strategic and operational concerns of owning and operating a small business. Strategic and operational decision-making are often interrelated. Students are encouraged to evaluate the short and long-term implications of three strategic options. The case addresses business decision-making, strategic management, and leadership. The issues of corporate control and the changing role of the owner-manager are also an integral part of this case study.
The case is designed for courses in small business and entrepreneurship. It may also be appropriate as an introductory case for courses in strategic management. The case is designed to introduce students to business decision-making in the context of a small business.
Case Synopsis
The Weight Room is a small health club located in Northern California. Originally a free-weight training facility (gym), The Weight Room has expanded its service offerings to include Nautilus-type weight machines, cardiovascular machines, and aerobics. The facility is currently feeling the strain of double-digit (16%) annual growth. At current projections, the club will exceed maximum occupancy in two fiscal years.
The business itself has been in operation for sixteen years. Presently, the club caters to 1,771 total members and enjoys a forty percent share of the local market. Increased competition from local competitors and potential new entrants, coupled with an unacceptable level of overcrowding at the present facility, has forced The Weight Room to consider its future. In addition, the physical condition of the facility itself is deteriorating. The owner, Joe Fitzgerald, is currently debating his options with regard to the business. He sees three main options: the status quo, expansion of the current facilities, or the relocation of his business to a brand-new facility.
________________________________________________________________
Contact Person: Randall D. Harris, California State University, Stanislaus
Mail: 801 W. Monte Vista Avenue, Turlock, CA 95382 USA
Phone: (209) 667-3723; Fax: (209) 667-3210; E-mail: raharris@toto.csustan.edu
PRIVATE MOMENTS-2000
Paul R. Reed, Sam Houston State University
Jennifer E. Spencer, Sam Houston State
University
Carol J. Cumber, South Dakota State
University
Diane J. Green, Sam Houston State
University
William B. Green, Sam Houston State
University
Case Objectives and Use
The purpose of this case is to expose the student
to the seldom discussed world of adult novelty stores. Private Moments-2000 is used as the vehicle
to both educate and require the student to perform a strategic audit of the
organization. Problems to discover and
solve are in such areas as marketing, finance, government oversight,
management, and HRM.
Based on field research, it is suitable for
courses in strategic management, marketing research, and entrepreneurship at
both the undergraduate and graduate level.
Case Synopsis
In October, 1996 Private Moments, an adult novelty
store, opened for business in Huntsville, Texas. Huntsville had no ordinances in place to prevent the opening of
this type of business. In fact, the
local Small Business Development Center provided guidance and assistance to
Edward Delagarza, the founder and owner of Private Moments. Many of the Huntsville citizens, unhappy
with the opening of Private Moments, approached the City Council requesting
that it be closed immediately and asked for legislation to prevent other
Sexually Oriented Businesses (S.O.B.) from locating in Huntsville. After a hearing before the Planning and
Zoning Commission to review alternative zoning restrictions, City Council
passed an ordinance that outlined the process for obtaining a permit to operate
as a S.O.B. and placed severe limitations on places a S.O.B. could locate. Private Moments, in existence when the
ordinance was passed, was grand fathered.
Although sales at Private Moments have grown
slowly, business has been profitable. Since opening Private Moments, Mr.
Delagarza has begun operating two other businesses: a tattoo parlor, which is adjacent to Private Moments, and a bar,
located some distance away. Ed must now
decide whether to remain in his current location and expand his operations by
selling adult novelty items to other markets in other locations, redirect his
effects toward internet sales or the wholesale distribution of S.O.B. products,
or devote his time to his other two businesses.
____________
Contact Person: Paul R. Reed, Management and
Marketing Department, Sam Houston State University, Huntsville, Texas
77341-2056. Phone
(936)294-1282/1256. FAX (936)
294-3957. Email mgt_prr@shsu.edu.
To
Sell or Not to Sell: That’s Just One of the Questions
Kirk
C. Heriot and Timothy M. Singleton, North Georgia College & State
University
Case Objectives and Use
This case demonstrates that the decision to sell a family business is much more than
simply an exercise at arriving at a price for the business. The student is encouraged to
assess the factors a buyer might consider when deciding to buy an existing business. The
case also asks the student and instructor to consider the role of family businesses in the
United States.
The teaching note was written for undergraduate courses in Small Business Management
or an introductory management course. This case will be useful with material about
family businesses or management succession. The case could also be used in a Strategic
Management course.
Case Synopsis
This case describes The Chocolate Shoppe, in Saluda, a small city in the southeast
Appalachian region. John and Debby Preston, have owned and operated the business for
18 years. In that time, the business has grown to such an extent that the Prestons earn a
comfortable living. Then, near the holiday season in 1999, the Prestons were made an
unsolicited offer to buy their business. The Fudgery, a retail chocolate and candy
business in a neighboring town, expressed an interest in buying their business.
Contact Person: Kirk C. Heriot, North Georgia College & State University, Dahlonega,
Georgia 30597
Mail: 124 Newton Oakes Center, North Georgia College & State University, Dahlonega,
Georgia 30597
Voice: (706) 867-2723; FAX (706) 864-1607; e-mail: kcheriot@ngcsu.edu
Precision
Partners, INC.
Jeffrey P. Shay, University of Montana
Fraser McLeay, Montana World Trade Center
Case Objectives and Use
This case was written to provide examples of the challenges associated with high-tech new ventures. By providing a detailed description of information available to the consultants at the time at which they had to provide recommendations to the company, the casewriters hope to provide the foundation for application of core analytical tools for assessing the viability of a new high-tech venture.
This case presents information on a company that has recognized a real opportunity for applying technologies in an effort to make a struggling industry more profitable. The characteristics of this overlooked industry provide an extreme example to challenge students. For example, while most businesses in today’s economy readily utilize computers, only 47 of U.S. farms have a computer. This provides significant challenges for a company when trying to sell a technology based product that has the potential to make farms much more profitable.
This case is intended for undergraduate and graduate entrepreneurial studies courses. It may also be used in high tech marketing, technology-focused, or agricultural management courses.
Case Synopsis
This case describes the challenges associated with marketing and selling new technologies to farmers. Jeff Shay and Fraser McLeay are assigned by the Montana World Trade Center to assist Precision Partners, INC. with its strategic plan. The two consultants visit Precision Partners’ headquarters in Fargo, North Dakota and gather initial information on the company. Upon returning to Montana they begin to supplement the data with information provided by a variety of trade journals and Internet sites.
Precision farming is essentially the integration of technology with traditional farming techniques. The goal of precision farming is to enhance farm performance through the careful monitoring of crops in terms of fertilizer, herbicides, and pesticides applied in conjunction with crop yield data. After a three-year period of gathering data on specific fields farmers have the information necessary to be more proactive and efficient in the application of these inputs in the future. The end goal is to enhance yields while minimizing inputs.
Shay and McLeay will be presenting their findings in a meeting with Precision Partners in one week. They need to provide a plan that will help the company overcome the challenges associated with selling the CropPartners Management Services program to farmers who are generally technologically averse. The information in the case provides data on the industry and on the specific characteristics of farmers that may be influencing their decision process.
___________________________
Contact person: Jeffrey P. Shay, University of Montana
Mail: School of Business Administration, University of Montana, Missoula, MT 59812
Voice: (406) 243-5880; FAX: (406) 243-2086; email: jshay@business.umt.edu