Dragonfly- Lack of Management Experience

The Thompson’s business decisions’ from the start of their relationship to their current situation has proven their lack of management experience. With both of their backgrounds in retail and buying, their choices were based more on what they know; retail, rather than what will make the company succeed. Each of their choices brought more risk than a successful small business owner would have made, who has experienced in more than retailing. Lastly, their strategy at Dragonfly to markdown inventory while not paying rent to their landlord, showed their lack of experience or knowledge of running a successful business.

Opening the Lady Madonna franchise was the only successful decision the Thompson’s had made. As proof of their ignorance to management skills, they foolishly chose to move on from their Lady Madonna franchise, which was already equipped with brand-name familiarity and a national marketing platform to open up their own business. The Thompson’s enjoyed the buying trips, choosing inventory, and serving customers but a company cannot be run by owners who only know one side of the business; the retail side.

The risk of a decision can be described as how expensive is the cost of failing. The Thompson’s had a large cost of failing. By opening their own business without management experience or partnering with someone who had that experience, their only chance was a long-term low return. As a result from leaving Lady Madonna, the Thompson’s needed more capital and for a start-up company with a small amount of research towards, meant more risk. If the Thompsons would have spent more time researching the area of the Crossroads Shopping area or their idea of discovering a new niche market for teenager expensive t-shirts , they could have discovered that this idea would not work. However, their focus remained on