Case Name :      River Bend Trading: Navigating Rough Waters

Authors :           Tom D. Hinthorne, Patricia A. Holman

Source :             North American Case Research Association (NACRA)

Case ID :            NA0182

Discipline :        General Management

Case Length :    15 pages

Solution sample availability : YES

Plagiarism : NO (100% Original work)

The case challenges students to develop a turnaround strategy for a small-town retail business following the loss of a major supplier. The students must develop a retrenchment strategy (i.e., cost and asset reductions) and a recovery strategy to rebuild the core business and develop the adjacent possibilities (i.e., adjacencies). It was February 2009 in Columbus, Montana, population 2,000. Lois Frerck (frair ic) owned River Bend Trading (RBT), an apparel and gift shop located next to the Montana Silversmiths Outlet (Silversmiths). Silversmiths manufactured silver jewelry, rodeo trophy belt buckles, and other western products in Columbus. RBT was a Silversmiths’ dealer, and 50 percent of its sales came from Silversmith’s products. In 2006, RBT’s sales peaked at $485,951, and Silversmiths decided to sell directly to its customers over the internet. In January 2007, it revoked RBT’s dealer status. Devastated, Lois and Mary analyzed their options, but they were unable to offset the loss of Silversmiths’ products with new products. With the onset of the recession in 2007, RBT’s sales plummeted. In November 2008, Mary told Lois, “The business is dying. I can’t handle it. I’m out of here! I’ll take my half of the debt,” and she left. As the recession took its toll on local businesses and the tourist trade, RBT’s 2008 sales fell to $220,023. In February 2009 Lois asked her sister Amy, “What should I do?”