Picking through the crumbs!
Crumbs the 46 store chain announced last week it was filing for bankruptcy and ceasing operation. I’ve read all the post mortem commentary on how this happened. They over expanded, they were poorly run their business model was vulnerable since it was based primarily on one product category. I’m sure it’s a combination of factors that eventually did them in. There is another factor that I’ve hasn’t seen mentioned that deserves consideration. Retailers that expand have to very careful that they can duplicate the sense, the feel and the personality of the business. Successful small retail businesses usually have a personality that is an extension of the owners. Employees and customers both are influenced by that presence. Think in terms of one of your favorite restaurants where the owner is also the chief. You know what to expect when you go there, no surprises always consistent. So the challenge is how that same feel can be duplicated when a business expands. Think of the Seinfeld episode where they could no longer make the crepes at The Magic Pan because Izzy Mandlebaum and his son and father were all in the hospital at the time and no one else was trained to make the crepes. The first step to becoming a successful multi- store operation is to learn how to delegate. Give your key employees latitude. Let them make mistakes and grow. You can’t grow until you have the right people in place who know exactly how you want the business to be managed.
A joint venture firm has come forward to provide financing and reopen the chain as a private company. Besides the financing I sure they will provide the management expertise to reinvigorate the brand and expand the brand. It will certainly be interesting to watch.