Answer the three questions following the case.

Case Study

TOBA SUPPLIES COMPANY(Source: Business Development Bank of Canada) (5%)

Personal Data

Bill Petersen, age 38, has been working for the Toba Supplies Company for 16 years. The company operates retail building supply stores throughout Manitoba and Saskatchewan which specializes in residential building material (lumber, plumbing and electrical supplies), contractor supplies (cement, wiring, and metal tubing) and farming supplies (pre-fabricated bins, silos, etc.).

Bill was born in Brandon, a small city with a population of approximately 35,000 people. After completing grade 12, he worked at various jobs until joining Toba Supplies Company. Bill likes his job because it allows him to be in contact with the public. He is married and has two children, ages 7 and 12. His wife, Joan, age 31, although devoting most of her time to being a housewife, is also involved with many local women's and community groups. She is very active within these groups and is usually given the position of secretary-treasurer.

Work History

Bill joined Toba 16 years ago as a stock boy, then served as a junior salesman and finally a senior salesman. After 6 years, he became assistant manager at the Neepawa store and two years later was assigned the job of assistant manager at Lynn Lake. Bill showed promise in both these positions and at the end of 9 years of service he was appointed manager at the Portage La Prairie store. This was quite a move for Bill, as the Portage La Prairie store was one of the company's major outlets in Manitoba. Within 3 years, the store's sales volume had increased 11/2 times and Bill was credited with having brought about this increase.

During this period, the company again transferred Bill and this time he was made manager of the Dauphin store. Bill could not understand the reason behind the move. The Portage La Prairie store had grown by leaps and bounds but there was still more that he felt he could do there. On the other hand, the Dauphin store was considerably smaller in size and Bill thought that it had been doing well.

However, Bill did not know that 2 years before, Toba Supplies Company had conducted a study into the future market potential of areas in which their stores were located. The survey concluded that the Dauphin area had the highest potential for growth of any of the areas in the province and in 5 years, the Dauphin store could be the largest branch in dollar sales. Bill was the man chosen to tap this potential.

For the next 4 years Bill again worked his magic and during this period sales rose from a figure of $300,000 to approximately $1,000,000. Bill's management capabilities did not escape the eyes of Head Office. He was asked to join the Head Office staff at Winnipeg, a move which Bill was told would enhance his chances for an eventual top management position. The decision whether or not to accept the offer was a difficult one. After much deliberation and thought, Bill's answer was no, he would like to remain in Dauphin for the present. His request was granted but Bill knew that he would be asked again.

When the opportunity for a position at Head Office had first presented itself, Bill and Joan spent many evenings discussing the pros and cons of accepting the offer and moving to Winnipeg. Joan and the children had made all four moves with Bill and, although it was fun to go to a new place, Joan sensed that the children were not looking forward to another move. They were at that age where they were developing other interests (besides immediate family) and were becoming closely attached to their friends. The novelty of moving to a new place was wearing off. Both Bill and Joan were raised in a small town and liked the friendliness and convenience which Dauphin offered. During the summer months, the family liked the outdoor life and, whenever possible, would hop into the car and go camping. Dauphin was ideally situated for this and offered a wide choice of camping sites within a very short distance. Bill was well liked in the community and involved in many local organizations. Recently he had bought a plot of land outside Dauphin and planned to build a house and maybe try a bit of farming.

Bill's Dilemma

Bill knew that he would again be offered a position at Head Office and if he refused, his chances for any future with the company would be slim. What should he do? Bill was successful at his job and one of the highest paid store managers in the company. He had proven himself to be a good manager and done everything the company asked of him. However, one thing has always bothered Bill. With all he had accomplished in the last sixteen years he had very little in the way of tangible benefits to show. He knew that the company was paying his salary and what they expected in return. But what was he getting for all his efforts? A regular pay check. Job security. Three weeks holiday each year. A pension when he retired. He thought that there must be something more.

Bill and Joan again talked over their situation. The next time a position was offered at Head Office, what should they do? One alternative was to set up a business of his own.

He knew the building supplies trade and he thought he knew what the people in the area needed. But, including Toba Supplies, there were already three well established stores to compete with within a 10-15 mile radius of Dauphin. There was no concentrated effort to service the rural market needs beyond this 15 mile radius. He couldn't understand why.

Maybe ...just maybe... Bill could open his own store and service this rural market. Why not? He would start his own building supplies store. Before Bill makes his final decision he comes to you, a small business consultant for some advice.

Assignment:

1.Make a list of pros and cons of Bill's entrepreneurial characteristics and his situation.

2.List Bill's alternatives.

3.What would you advise Bill?