Boston Duck Case Study

Eric Porter

"Boston Duck Case Study"

B283

Case Analysis

Introduction:

     Andy Wilson was an ambitious man who felt that he wasn’t getting what he deserved after helping a savings bank, The Boston Company, grow so much.  He gained much experience from working with 65 clients, totaling nearly 6 billion dollars in assets.  So with this knowledge he felt confident that he could achieve much more on his own than with the Boston Company and left to start his own.  But Andy was still missing one key idea, what kind of business would he have?

            Andy began his search roaming the highways of America on the back of a Grey Hound bus, eventually spotting a WWII amphibious vehicle called a “DUCK”.  He quickly ended his journey to begin another one by “transplanting” this “DUCK” business into the east coast, particularly, Boston.

Problem Analysis:

-Major problems and challenges facing employees and organization:

            Andy faces the same problem that most companies do when the season changes.  Business slows down, and in some instances stops completely for a time.  Overcoming this hurdle every year is going to take constant planning.  Most employees can’t just take a 4-5 month vacation and come back; which would mean that Andy would have to let most of his employees go and try to hire them back once spring arrives.  With a constant change in employees, hopefully most would be previous employees, other-wise there would be an increase in confusion as new people need to be trained every year. 

            And there is a double edged sword with the seasons because with the summer heat also comes more congestion on the roads and on the water limiting his business to 65 DUCKS.  In “The E-Myth Revisited” by Michael Gerber he strongly states that every business hits this point and has to choose to either grow, remain, or shrink.  Every business that chooses not to grow eventually discovers that they have shot themselves in the foot and fail.  A business needs to grow, even if the pace is at a snail’s pace it needs to keep moving forward or open the door to failure. 

            With the vehicles only good in fresh water this drastically narrows his window of opportunity for expansion.  McDowell was in the process of growing a DUCK fleet to travel in both fresh and salt water, but to have access to those from him it would be extremely challenging without a company merger.  However, this simplification would come at the cost of Andy’s control over his side of the business.

            -What do “I” think the business is doing right and what do “I” think they need to change.

            I like that Andy went to Bob McDowell, one of the largest duck tour operators in the nation, and even flew him out to Boston to expound his vision.  Receiving information from an experienced individual over the phone is one thing, but seeing them in person “on the site” is completely different.  I think it creates an easier environment for Andy to sell his vision and inspire McDowell to his level.  Furthermore, he doesn’t just stop at getting advice he eventually makes a deal to receive the equipment necessary to run the business, very similar to a franchise.  Andy compromises his side by offering a slice of all revenue and to pay off the Ducks in 5 years.  This is a wise move for Andy because both Andy and McDowell have vested interest in this company.  Both want it to succeed which helps fan their fires of entrepreneurship.  

            There was a silver lining behind the dark clouds of Andy’s permit crisis.  All the fine details they required allowed Andy to see the direction his business needed to go.  It helped him see what he needed to do to be successful.  To overcome obstacles Andy studied other businesses and how they dealt with the problems he would be facing.  Like how to remove polluted soil from the boat ramp. 

Carrie McIndoe, of Strategic Capital Resources, arrived to help Andy raise the money needed to pick his business of the ground by changing a few things; his sales pitch, not approaching potential investors the right way, the deal structure was poor, and his memorandum cover needed revising.  Andy should have made the call sooner than later for her help.        

Recommendations:

Andy should have looked into what legality issues he would have confronted before jumping in so soon.  In looking towards the future he needs to continue in his entrepreneur’s spirit and spread to other cities.  This could be a very effective during winter with all his spare time while the business is hibernating, to seek out cities with which to expand. 

Andy also shouldn’t just think about doing the same think in other cities, but adding more to his business.  There are two ways to run a business: own a monopoly where everyone needs to come to you for a specific product, or own the resources yourself so you don’t depend on other businesses.  Andy needs to consider the possibility of either buying ducts from another business or even venturing to expand his business to make his own DUCKS.  Surely his own ducks will need repairs and if he could do it himself it could be more cost effective.  Yes, it would be a big step in a whole other direction, but it wouldn’t be the first time.

Conclusion:

If they are to merge with McDowell’s company it is probably still going to flourish and expand to other cities and be a strong business.  Andy, however, will have little control over its future and will be demoted from employer to employee.  By attempting to expand on his own, it will require far more work, yet be far more satisfying.  He should start to cut the umbilical cord to McDowell and be more self-sufficient.  Expand his fleet, with salt and fresh water capabilities, to the coast and then  move on to Europe once reaching the point of “saturation” as Andy called it.