Cain and Able

Topics: Small business, Business, Strategic management Pages: 3 (979 words) Published: December 3, 2012
Based on the information presented in the Cain and Able case we believe Candance Leak should pursue merging specifically with Happy Tails or company with similar products. This is the best opportunity because it will allow Leak to spend more time with her family allow Cain and Able the chance to grow and be sold for a worthwhile amount.

The merge will allow Leak to spend less time working because merging with a similar company allows business activities to be shared (ie. Only one business partner will have to attend a sales call or trade show for both product lines). The merge with Happy Tails (or a similar company) will align company synergies and core competencies due to similar products, distribution networks, and ultimate interests they both possess. This will allow the newly formed company to create a more valuable brand and reach higher sales volume. Once the company reaches $5-10 million in revenue Leak can come out with much more than a outright sale on her own.

We believe this is the best option for Leak
1. Bumps up revenue making it an appealing buy 2. PetCo 40% experience with sales with larger firms know they won’t run into the ground 3. Many opportunities but inability to reach a competitive volume 4. Penetrate other large retailers like PetSmart 5. Too soon to get out- industry is booming while her growth is stagnant a merger could help get back on track

Prize= gaining a partner, improving volume and brand presence… gaining more market share. Therefore, potentially receiving a higher valuation when sale occurs. With a merger her workload would be decreased because of the help of her business partners and she will have less personal stress because the eventual sale of the company.

Despite having surprising and exponential growth at the beginning, Cain & Able’s growth has become stagnant over the last two years. Candance Leak, founder of Cain & Able, faces a dilemma- she no longer wants to spend the...
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