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Case History #3:
Expansion for the
Wrong Reasons
Fred Blackbumʼs story of business success and
then failure is very complex. He successfully
operated a PIP quick printing franchise for a
decade. When a downtown renovation eliminated most of the parking near his business
and made access difficult, sales began to decline. He lost his franchise and continued to operate as Fredʼs X-Press Printing. A few years
later, Fred was evicted from his downtown location _ the building had been sold and was
going to be torn down and replaced with a new
bank office tower. Wanting to keep both a mall
presence and a downtown store, he chose to
move across the street into another new building. Moving was not new to Fred; he had had to
do it twice before. But this time he had to pay
for plumbing, wiring, and interior wall construction – and business was bad. Furthermore,
quick print shops were proliferating in the downtown area at the time. And photocopy businesses using high quality, high speed machines
further eroded his market share. Nevertheless,
after Fred moved, he found himself with an
extra printing press that didnʼt fit into his tiny
new shop. So he decided to open a third store,
just because he had the equipment, he said,
even though he did not have enough equipment to open a full-service shop or enough capital to upgrade his own photocopying machines.
He was saved from bankruptcy by a buyer, who
closed the third location immediately.
continued...
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