Introduction
Erica was always passionate about arts and creativity since her childhood. Consequently, she decided to start an art-related business when she could not find a job in Russia due to immigration rules and the language barrier. She named her business Warm Fuzz Cards that was initially aimed at making cards for any occasion. She designed 200 cards and organized a party that was primarily aimed at choosing the best cards. Erica ended up with 36 cards to sell to her 150 customers who were mainly based at Ontario, British Columbia, and Alberto. Erica maintained close contact with customers to develop beneficial relationships. Later, Erica decided to design cards for the wedding invitations and corporate business cards. Nevertheless, she is not sure about the business strategy to pursue, as each is associated with some constraints. She is not sure of whether to pursue a fast or slow growth strategy.
Analysis
Even though Warm Fuzz Cards is enjoying a steady positive growth since it was started, Erica is still facing some issues that may be threatening the future success of her business. The major issue that she is facing is the type of growth strategy to choose. Currently, the business is growing steadily and slowly, and Erica seems to be enjoying that. For instance, in 2007, she was able to achieve $2,000 in sales per month, which increased to $3,500 in 2008 (Mills, 2011). Nonetheless, despite successful slow growth, Erica is determined to achieve faster growth to become successful. Besides, she is facing other related growth issues, as she is not certain of which areas to invest in to enhance the growth of her business. She has to choose to improve financial management, enhance sales and marketing, invest in inventories or add design capabilities (Sharen, 2009). Therefore, there are many growth-related issues that Erica must decide on to achieve faster growth and to expand her business. The issues are challenging a pose a lot of dilemmas.
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However, Mills’ strategy is a slow but steady growth of the Warm Fuzz Cards. Mills is focusing on small customer bases of about 150 clients who are located in specific areas (Mills, 2011). Mills is focusing on enhancing business-customer relation to create a strong and loyal customer base that can lead to a competitive advantage. The fact that Mills has not employed any additional employee is an indication that she favors a slow growth strategy. Nevertheless, Mills is ready to diversify the products, as she has expanded her product line to include wedding cards as well as corporate cards. Besides, it is even stated in the case that Mills is enjoying the steady and slow growth of her business.
Even though Erica may be interested in growing faster and achieving success, it is better when she pursues a slow growth strategy. One of the major reasons why she should choose a slow growth strategy is because of sustainability ( Jackson, 2008) . With the slow growth strategy, her business will not be facing many risks while at the same time she will be able to build the right team that is dedicated to achieving the company goals, objectives, and visions (Smith, 2003). At the same time, there are high chances of sacrificing or compromising the quality of products on services when a business focuses on fast growth strategy (Budd, 2016). A business is only able to gain a competitive advantage in the market if it offers quality products and services to its customers ( Chopra, 2014) . Therefore, to continue meeting the needs of her customer, Erica should use slow growth strategy. Also, her challenges such as language barriers and family responsibility may make fast growth strategy challenging for her. Although she is likely to miss many business opportunities when she employs a slow growth strategy, Erica will enjoy steady growth and sustainable success ( Durmaz & Ilhan, 2015) .
Nevertheless, if she were to pursue a fast growth strategy, Erica will be forced to invest in adding design capabilities. She will have to employ additional designers and buy designing achiness to improve design capabilities of the firm. Faster growth option means that she will be expanding her customer base, leading to an increase in demand. She will have to spend a minimum of $10,000 to expand her designing capabilities. She should borrow the money from her husband some trusted friends to reduce financial burden and stress that is always associated with borrowing from commercial banks ( Klačmer, Horvat & Lalić, 2014) . She can get better terms of repayment from her husband and friends than when she borrows from banks.
Recommendations
Fist, Erica should make a quick decision on the business strategy that she wants to pursue. Making quick decisions will help her to focus on the future success of the business, which is essential in gaining the competitive advantage in the market. Second, she should pursue a slow growth strategy, especially based on her situation and status in Russia. She should ensure that she gradually increases the volume of her products by using modern technologies. Using modern designing technologies will ensure that she provides quality products to customers. Also, she should gradually increase the number of employees. Thirdly, she should not shun fast growth strategy when she feels that she has all the resources to implement it. However, she should invest in inventories and get money from the right sources such as friends.
References
Budd, A. (2016, May 10). The benefits and challenges of running a slow-growing business. Clearleft . Retrieved from https://clearleft.com/posts/the-benefits-and-challenges-of-running-a-slow-growing-business
Chopra, K. (2014). An empirical study on the role of customer service in delivering satisfaction at branded retail outlets in Pune. Procedia Economics and Finance , 11(1) , 239-246.
Durmaz, Y., & Ilhan, A. (2015). Growth Strategies in Businesses and a Theoretical Approach. International Journal of Business and Management , 10 (4), 210.
Jackson, S. E. (2008). Making growth make sense for retail and franchise businesses. Journal of Business Strategy , 29 (3), 48-50.
Klačmer, M., Horvat, J., & Lalić, M. (2014). Analysis of financing sources for start-up companies. Management: Journal of contemporary management issues , 19 (2), 19-44.
Mills, E. (2011, June 2). About Erica. Retrieved from http://www.warmfuzzcards.com/about.html
Sharen, C.(2009, May 28). Spreading Happiness: Warm Fuzz Cards. Harvard Business Review . Retrieved from https://hbr.org/product/spreading-happiness-warm-fuzz-cards/909M39-PDF-ENG
Smith, D. (2003, April 14). Is Faster Better? Retrieved from https://www.entrepreneur.com/article/61014
