Warm Fuzz Case Study

Spreading Happiness: Warm Fuzz Cards

A Case Study

Erica Mills is an artist and business woman who owns Warm Fuzz Cards, a Toronto-based greeting card company that she started in 2006. Mills has always been an artist and has always had a knack for business ideas. She enjoyed hand-making cards for friends and family and decided to channel this into starting her own business. She employed a slow growth strategy which has been profitable since the beginning of her business. However, Mills and her husband would like to start a family and she does not know how she will have the time to continue her strategy as well as devote time to parenthood. She has a choice to make regarding her business and personal life. Should she continue a slow growth strategy or rapidly expand her business with a fast growth strategy?

Analysis

What is the primary issue she is facing and the related issues?

The primary issue that Mills faces is the decision to slowly grow her business, continuing to “bootstrap” her way forward using cash generated by the business to fund growth, or to grow quickly and seek a partner or further financing. Growing slowly presents a challenge for her personal life. She and her husband want to have a child soon and growing the business slowly on her own would be difficult with the additional responsibilities of parenthood. She would also be giving up significant business opportunities with a national chain of stores that could sell her cards. Fast growth would present issues as well. She would need to spend more time improving financial management, increase sales and marketing, invest in inventory, and possibly hiring a designer to come up with designs while Mills focused on sales, and all of these options would require more funding than the business alone could handle. Understanding her own strengths and weaknesses of her current strategy will help Mills navigate the issues associate with the decision she has to make.

What are the strengths and weaknesses of Mills’ strategy?

Mills’ strengths come from her passion for her art and her business. She also developed skills in management and sales during her years as a sales representative which has helped make her business a success. Her strategy has been slow growth and she has had positive sales since the start of Warm Fuzz Cards in 2007. Mills has led her business through every step right from the start. She designed all the cards herself and has done the research to find out what customers want most from greeting cards. Mills personally calls on her retailers to discuss which designs were working and which were not and incorporated this customer feedback into her new designs. Through her research, she found that the wedding invitation market and custom corporate cards market would help her