To be successful in business it can often take a great product and a lot of hard work. But sometimes, more than anything else, a shrewd manoeuvre can be the difference between failure and making it big. This article was co-authored by Charlie Hilton and Eoghan Burke.
Search anywhere for the year Virgin airlines was founded and you'll find 1984, the year Richard Branson leased a single Boeing aircraft and started selling flight tickets in his record shops. But Branson's inspiration for owning his own airline actually came five years earlier, as he explained at the at the 4th Madhavrao Scindia Memorial Lecture last year:
"In '79, when Joan, my fiancee and I were on a holiday in the British Virgin Islands, we were trying to catch a flight to Puerto Rico; but the local Puerto Rican scheduled flight was cancelled. The airport terminal was full of stranded passengers. I made a few calls to charter companies and agreed to charter a plane for $2000 to Puerto Rico. Cheekily leaving out Joan's and my name, I divided the price by the remaining number of passengers, borrowed a blackboard and wrote: VIRGIN AIRWAYS: $39 for a single flight to Puerto Rico. I walked around the airport terminal and soon filled every seat on the charter plane. As we landed at Puerto Rico, a passenger turned to me and said: "Virgin Airways isn't too bad – smarten up the services a little and you could be in business."
When Virgin Atlantic was officially launched five years later, all thirteen of his major US competitors predicted it would fail within a year. Twenty one years on, each of them is now out of business and Branson's net worth is estimated at $4.6 billion.
Richard Branson with his business partner Sir Freddie Laker
2. IBM Comes Back From The Brink With Operation Bearhug
This story of IBM's amazing come back is taken from a Quora post by Arjun Subramaniam.
"In the early 1990s, IBM was in a deep crisis. For the first time in its history, employees were being laid off by the thousand and revenue had collapsed like nobody's business (Pun intended)
In a last-gasp attempt to save the company, new CEO Lou Gerstner launched "Operation Bear Hug." 50 managers from IBM were sent around the world to meet with at least 5 customers each in person – A rather surprising display of empathy from one of the least emotionally demonstrative companies in the Fortune 500.
IBM proved that a faceless corporation could be empathetic and understanding
The goal of the managers was not to market IBM products – Instead, they were to listen to consumer concerns and see how IBM could help. That "empathic" connection to real-world customers helped the managers see matters from a consumer's point of view.
Gerstner's style of leadership and his dogged attention to the consumer and their needs eventually brought a new and less arrogant face to the company. By his second year, IBM was back on track, setting off a decade of unprecedented earnings growth and double-digit revenue. This clever maneouver ultimately helped IBM become the leading technologically giant that we know it as today."
3. Peyton Manning Invests In The Future Of Pizza In Colorado Two Weeks Before The State Legalizes Marijuana. Coincidence? I Think Not!
It was either a timely coincidence or a stroke of genius from NFL legend Payton Manning. Just two weeks prior to the passing of Amendment 64 which legalised marijuana use in Colorado, the Denver Bronos quarterback purchased 21 Papa Johns franchises in the state.
Sales across the branches have reportedly skyrocketed since the takeover, making it a very shrewd investment indeed. Whether it's Manning's fame or the munchies that's been drawing in the crowds we may never know…
4. George Soros Breaks The Bank Of England And Makes £1 Billion While He's At It
In September 1992, one of the most successful magnates in the world, George Soros, went head-to-head with the Bank of England in what would later be called Black Wednesday. At the time Soros was the currency man and was carefully monitoring the BoE as they attempted to keep the British Pound exchange rate high.
The BoE was buying pounds in order to maintain their projected exchange rate, but they had a diminishing amount of buying power and the predators were beginning to circle.
George Soros was banking on the idea that he could short sell more of his British Pounds than the Bank of England would end up being able to acquire. When Soros made his move, other currency traders followed suit and sold in Pounds by the truckload. Soros ended up making a personal profit of approximately £1 billion.
The event lead to the Pound dropping over 20% in a few weeks and George Soros being crowned "The man that broke the Bank of England."
In 1984, Nike's business fate took a drastic turn – one so drastic that it saved the company from its first ever loss. Their tactic wasn't to save the ship from sinking by offloading dead weight. Instead, they channelled all of their marketing budget into one man: Michael Jordan.
The unproven rookie with enormous talent proved to be Nike's saving grace. He would go on to become the most successful basketball player of all time, and the Air Jordan range that ensued is now one of the most recognised training brands in history. The company currently enjoys yearly revenues close to $25 billion.
This story was taken from a Quora post by David Fry
6. Dow Chemicals Create A Blueprint For Dealing With Predatory Price Cutting
"Herbert Dow founded Dow Chemical in Midland, Michigan when he invented a way to produce bromine cheaply. He sold the chemical for industrial purposes all over the US for 36 cents per pound at the turn of the 20th century. He couldn't expand overseas, however, because the international market was controlled by a giant German chemical cartel that sold at a fixed price of 49 cents per pound. It was understood that the Germans would stay out of the US market so long as Dow and the other American suppliers stayed within their own borders.
Soon Dow's business was in trouble and he had to expand. He took his bromine to England, easily beating the cartel's fixed price of 49 cents per pound.
But Dow outsmarted them. He stopped selling in the US market entirely and instead arranged for someone to secretly start buying up all the German bromine he could get his hands on. Dow repackaged it as his own product, shipped it to Europe, and made it widely available (even in Germany) at 27 cents per pound.Shortly thereafter, German bromine started appearing for sale in the US for 15 cents per pound, way below Dow's price. The cartel flooded the US market, offering the chemical way below their own costs, intending to drive Dow out of business.
The cartel lowered its price to 12 cents and then 10 cents and Dow just kept buying more and more, gaining huge market share in Europe. Finally the Germans caught on and had to lower their prices at home, But it was too late.
Dow had broken the German chemical monopoly and expanded his business greatly. And customers got a wider range of places to buy bromine at lower prices.
This strategy is now the textbook way to deal with predatory price cutting."
7. Henry Fords $5 Day
Henry Ford is one of those guys that went against the grain, with extraordinary ingenuity, to bring about incredible results from a strategy that was widely expected to fail.
Other industrialists and businessmen called Ford a socialist, seeing him as toxic to the capitalist system they so adored. The public, however, fell the other way. He was labelled a hero, a man that was fighting for the welfare of the working people – a slice of genius that made him a viable candidate for US presidency. He even dropped the working day from 9 hours to 8 hours for good measure.At the beginning of 1914, the worker wage at Ford Motors was set at $2.34 per day, which was standard for the time. He made the brash and seemingly foolish decision to more than double the wage, pushing it up to $5 per day.
The positive public feeling towards Ford crept into the media. The PR that the company received from the decision meant that the spending on wages were being recouped in profits, and then some.
Henry Ford's idea was to ensure that his workers could actually buy Ford cars. Profits increased 200% in two years to reach $60 million dollars per year.
A highly motivated and prosperous workforce helped Ford completely outstrip their competitor's productivity. 13,000 workers were churning out 260,000 cars per year, while the rest of the industry comprised of 66,000 workers who produced 280,000 in the same amount of time.
8. Mucinex Eliminates All Competitors in One Go
Memegenerator
When Mucinex (an over-the-counter cold medicine brand) was launched, it entered the market with immense force and quickly came to dominate all competitors. This was all due to their exploitation of a cunning legal loophole.
The drug was administered in a 600mg dose with a 12-hour release period that followed. Mucinex wanted their product to be sold as non-prescription for wider sales potential. (N.B. The law prohibits and non-prescription product to be sold as a prescription product if it has the same dosage and release time).
So, Muxinex applied and gained approval from the Food & Drug Administration to sell its product as a non-prescription…
"In other words, once Mucinex–which owned the patents for all non-prescription drugs of its kind–gained FDA approval, its competitors' prescription products were deemed illegal. The FDA issued warning letters to 66 manufacturers, distributors, marketers, and retailers that sold the drug as a prescription product and eventually ordered them to cease production altogether."
Thanks and regards
( hari krishnamurthy K. HARIHARAN)"think of them as Sand paper.
They Scratch & hurt you,
but in the end you are polished and they are finished. ''
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