The largest Chevrolet dealer in the country filed for bankruptcy in September 2008. So far in 2008, 590 auto dealers have closed their doors, compared with 1,200 between 2001 and 2008. As described here, the auto manufacturers are quite pleased to see these dealers go. Why? The business model doesn’t work, especially in an economic…
Business models are about tradeoffs. Remember the classic notion: Good. Fast. Cheap. Pick two. When designing a product or business, you must understand how these tradeoffs matter to the customer. Jerry Flint argues that “Mileage isn’t Everything“. He’s right — comfort, capacity, looks, price, safety — all of these matter to the customer. But what about…
Both UPS and FedEx are launching finance businesses to "boost customer demand by loaning money to small businessess." This financing would provide working capital, often secured by the underlying inventory. See story here.
As Forbes reports here, Ford and GM have been retooling their plants to shift away from SUVs to smaller cars. Underlying this business plan is a big assumption about the future of gas prices — they are explicitly betting on gas in the $4 to $4.25 range per gallon. So here are a few questions to consider:…
The article about Zipcar in the Sept. 8, 2008 issue of Business Week illustrates several aspects of business model and strategic thinking:
