Case Study: Roxanne Quimby
“Entrepreneurship is a way of thinking, reasoning, and acting that is opportunity obsessed, holistic in approach, and leadership balanced for the purpose of value creation and capture”. This quote best defines entrepreneur Roxanne Quimby. Regardless of her humble beginnings she was able to use her creative skills and business tactics to create an empire. In the long run her hard work rewarded her with millions of dollars.
Burt’s Bee’s became a major success after a matter of years. It all started with Roxanne and her team of forty employees that kept the whole operation running. The business grew to obtaining revenue of three million dollars per year. However, soon enough Roxanne was hit with a major dilemma. Her company was originally located in the state of Maine. As many may or may not know Maine has an expensive payroll and business tax is high. So in order to remain in Maine the company would need to expand fast. For some reason, however, the company’s growth could not keep up with Maine’s demands. so Quimby had to make an important decision, fast. After some consideration Quimby decided to move her company to North Carolina. North Carolina at the time was a popular state, where companies were growing and expanding. The taxes in North Carolina were also lower than they were in Maine. At first, Roxanne was feeling apprehensive about the move. But overall the decision was not too difficult to make. There was potential growth that Roxanne envisioned for her company there and she seized the opportunity. But with opportunity comes different alternatives that Quimby had to consider before she made a concrete decision.
Her first alternative was to stay in North Carolina. Roxanne was financially stable enough to commit to North Carolina. She had in place managers that could help the company grow to its full potential. The pro with staying in North Carolina were that Burt Bee’s would have the opportunity to grow to revenues of seventeen million per year. However, there are many cons to the situation as well. First according to the exhibits provided the cost of labor would be increased. While in Maine the cost was five dollars an hour for employees. The average hourly rate is ten dollars and ninety cents in the state of North Carolina, which is double. Being that the type of production is going from handmade to machinery, not only would the production cost go up but also Burt Bee’s would have to change its entire product line. Also if the company is expected to grow she would have to give up some ownership of the company as well. Usually when a founder gives up ownership of a company that means the company could possibly shift from the overall vision of the owner. A price to pay if you want your company to grow on the scale desired. Shared ownership also means decisions that may not be yours could be put in place.
The second alternative is to move back to Maine. Roxanne could halt her entire operation, hiring employees and purchasing equipment. She can just move back to Maine and hire all of her employees again and start where she left off. She can work out a deal with the governor of Maine for taxes, transport and employee cost. Most importantly she can keep the product line of Burt Bees’. The handmade product line that was responsible for its success in the first place. The cons will be of course the company may not exceed revenue of three million per year. The growth of the company will be stunted and Burt Bee’s may never reach its possible full potential. Third, Roxanne could sell the company. By her selling the company she can move on and work on other things that she would like to accomplish in her life. The only difficult part is getting a buyer that would buy a company with only three million in sales. That would be the biggest challenge if she considers this alternative at this point of her career. Even though the company has received buzz buyers would want to see the company grow first before they decide if it is worth buying because they will like to know if it will be profitable. The best solution in my opinion would be to stay in North Carolina. I feel that staying in North Carolina would open up more opportunities for the company. The company can grow exponentially in terms of revenue going from three million a year to a possible seventeen million a year. Roxanne has a chance of hiring employees with experience as oppose to the employees in Maine with little to no experience. By having employees with experience Roxanne is able to focus on other things on the company. While in Maine she found herself wearing many different hats because she had to worry about production and shipping and doing everything her self. Roxanne Quimby can just hire a plant manager with great experience as well as a sales and marketing manager who previously worked at large companies such as Vogue and Victoria Secret. The problem to me with the other two alternatives is that though they have their pros the main issue is growth. Burt Bee’s can offer so much more and the moves to North Carolina have a chance to provide that. I feel as if she can also execute her other alternatives as well. I feel that if the company grows she can open up a plant back in Maine. This will help the company grow more, eventually causing her to sell, as she also would like to do. This time with a company this large attracting a buyer would not be as hard. In conclusion the procedures that she should follow would be to stay in North Carolina. First obtain a team that would help with the goal and vision of the company. Next, start with the production of the products that she feels would be a big seller in the state of North Carolina. With a great team such with experience marketing Burt’s Bees would be easier. I also feel that when the company hit the potential growth that she should try to expand. Being that she has experience in Maine try to open up a production back in the companies home state. When the company is thriving sell the company.