E$6.$ Please read the following description of Enterprise Rent$-$a$-$Car$$s founding in $1957$ and the strategy that helped it become the most successful rental car firm in the country. What explains their competitive advantage and success?

Enterprise Rent$-$a$-$Car was founded in $1957$ and became the most profitable automobile rental company in the United States. Most of the leading rental car companies during the $1950$s through the $1980$s focused on the airport rental market, meaning that they rented cars to business and leisure travelers who arrived at the airport and needed ground transportation. Firms such as Hertz and Avis prospered at airport locations. They paid concession fees to the airports, often working hard to secure the most convenient on$-$airport locations. Their large parking lots provided the space required to stock a wide variety of cars for travelers seeking rentals. Firms such as Hertz and Avis were known for keeping their branches open nearly $24$ hours per day to accommodate travelers. Customers appreciated the extended hours. They also appreciated priority service offered for frequent renters; such priority service enabled travelers to not even have to speak to an agent when they arrived at the airport. They could go directly to their awaiting car. Enterprise did not locate at airport locations, but instead they focused on off$-$airport locations. In particular, Enterprise located their small branches near automobile repair shops, and it provided cars to people who were inconvenienced when their car was in the shop. Enterprise even offered to pick customers up at home if they needed a rental car. Every Wednesday, Enterprise employees deliver pizzas and donuts to their friends at the nearby auto body shops.

The major American automakers $$ General Motors, Ford, and Chrysler $$ developed close ties with major rental car companies such as Hertz and Avis, and eventually, Ford even acquired Hertz and took major stakes in Avis and National Rent$-$a$-$Car. Enterprise remained independent and family$-$owned throughout the years. The auto manufacturers liked controlling one or more rental car companies, because they were an important source of sales $$ rental car companies purchased as much as $10\%$ of the cars produced by the American automakers. Automakers also liked being able to use their volume with rental car companies to smooth out their production runs; i$.$e$.$ they would ramp up rental car production during slow times for consumer sales, and decrease rental car production when consumer sales were high. Of course, such shifts in production didn$$t always suit the needs of the rental car companies.

In the early days, rental car firms leased their cars from the automakers, and they returned them after several years. Enterprise became the first rental car company to purchase their autos rather than lease them from firms such as GM and Ford. Enterprise managed to rent its cars for more years than the typical on$-$airport agencies such as Hertz and Avis. Enterprise then sold the used cars from their off$-$airport locations after they had rented them for several years. Enterprise$$s founder, Jack Taylor, chose to offer a haggle$-$free sale process for the used cars. He posted a price on the window of each car, typically below the Kelley Blue Book$$s suggested retail price for that used car. Consumers learned that this price was a take$-$it$-$or$-$leave$-$it price, with no bargaining involved. Finally, Enterprise has a unique way of hiring and managing its employees. The company$$s chief operating officer puts it this way: $$We hire from the half of the college class that makes the upper half possible. We want athletes, fraternity types$$especially fraternity presidents and social directors. People people.$$ Once they are hired, employees are trained well, and branch managers are given a great deal of autonomy to tailor their location to the local market.