Balancing Career & Family: The Warm Fuzz Case Study

Introduction

The warm fuzz case study involves an entrepreneur Erica Mills who is a graphic artist and Craig, who is her husband, where they have the plans of starting up their family. They are in a bid to strike a balance between the management of their careers as well as raising the family. Craig had been working for a large firm in the department of the human resource in 2006 while Erica began her company, which was dealing with the greeting cards, i.e., the Warm Fuzz Company. She got the idea of the card company while she was traveling abroad together with her husband just before she started the company. Due to the issues of the laws in the immigration as well as the language barriers, she was unable to go to her work, and hence she started practicing the designs of the greeting cards ("no occasion" greeting cards). The main reason for sending the greeting cards, according to her, was to impart smiles on others. She accomplished the research on the American greeting cards competition market after she had worked on several designs. Erica, therefore, chose 36 designs after she received the feedback from the market and hence began her production.

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The primary issue that Erica mills is facing in the case study involves whether to seek additional financing to pursue the option of the faster growth or to keep on bootstrapping her business with the use of her strategy, which is of slow growth. One of the related issues involves the constraint of time that the two need to face in their decision making, coming up with an appropriate business plan for the company, hiring employees as well as raising funds within the next one year (Katz, 2014). She gets into a dilemma of whether to keep pursuing the slow growth strategy of the fast strategy. The two strategies, however, has its challenges. In the fats strategy, there is a challenge of raising the money, hiring employees, plan development, and also restructuring her current business structure. With the slow growth strategy, there is an issue of the loss of opportunities with the national store chains executive.

She had been running the business through the strategy of slow growth. Accompanying the strategy are the strengths and weaknesses whereby for the strengths, it allows Erica Mills to have more control over their daily operation within the company. Besides as a result of the slow growth of her business, she has adequate time in developing and also building stronger relationships with her retailers and also other customers (Sharen, 2009). Despite the slow growth strategy in her company, Warm Fuzz has always been more profitable to her. Erica mills in her sales analysis; she had surpassed her target for the monthly sales, and also, the company in 2008 had reached about $3500 monthly in sales. However, some of the weaknesses that her company is facing with the slow growth strategy are the fact that she does not have the formal financial training and also in keeping track of her financial transactions she uses just a basic paper ledger.

Therefore according to my view, Erica Mills needs to start pursuing the fast growth strategy before they began their family. This is because once they have children, Mills won't have much time in running the business herself, particularly in those areas where she is still unfamiliar, for instance, marketing as well as finance. Therefore she will have to assign responsibilities to other people in such backgrounds. Hence she would keep her mind in the sales as well as the design.

Hence if mills were to pursue the fast growth strategy, she would just have to invest in the bootstrapping while considering the equity financing and debt financing. Mills can try getting other companies to invest in warm Fuzz for her to come up with the money. For instance, she can use the company Gifts R Us who will invest into the company a total of $100,000 and in turn will get back equity of about 25%, 50% of its profits will be paid by Warm Fuzz to Gifts R Us until the complete pay off of the initial investment.

My recommendation to Erica Mills and her husband is to choose to expand the warm Fuzz Company through the use of the fast growth strategy and also identify an investor to use the option of equity financing. The analysis of the market reveals that the business of the greeting cards is very profitable, thus creating an attraction to other investors. Also, ills need to find another investor willing to fund her with an exchange of a small percentage stake in the company. This will strengthen the financial base of the company, especially in the recruitment of the new staff, products' marketing as well as the increase in the inventory's production at a faster rate as compared to her current strategy. If Erica Mills can employ the option of equity financing in the quick building of her business, then there is a change for her to minimize her potential risk and hence grow at a fast rate in the selling of the business for a bit huge returns.

References

Katz J., & Green, R. (2014). Entrepreneurial Small Business. New York: McGraw-Hill.

Sharen, C. (2009). Spreading Happiness: Warm Fuzz Cards. Ontario: Ivey Management Services. Retrieved from https://hbr.org/order/293670501