Rocky's Ace Hardware

Babson Professor Stephen Spinelli, Case Director

Jason Cannon, Case Writer

Arthur M. Blank Center for Entrepreneurship

© Babson College, 1999.

Abstract

When hardware giant Home Depot opens up a new store, local hardware stores scramble to survive. In cases A and B, the troubles and reactions of two hardware cooperatives are recounted by their owners. Case C is an industry note for the retail hardware sector that provides background information and a discussion of the transition from "mom and pop" hardware stores of around 9,000 square feet to the 80,000 square feet "Big Boxes" started by Home Depot. The owners face price competition that is so extreme in some cases that their competitor's retail prices are lower than the coop's wholesale prices. Options considered include: head-to-head competition, improving profit margins, moving to areas where there are no "Big Boxes," or redefining the target market. The hardware store's current promotion techniques, operations, financing methods and technology utilization are provided to give students a full picture of the industry. Note: The "B" case is titled King Hardware.

Location of the companies: Springfield, Massachusetts

Years spanned by the case: 1991 through 1999

Industry segments: Hardware, retail

Stage of the company: Mature, decline

Age of the entrepreneur(s): Not Applicable

Key Words: Entrepreneurship, cooperative, hardware, retail

DVD

There is no DVD available for this case.

Teaching Notes

A case teaching package, written by Steve Spinelli, is available for this case. The teaching package includes strategies for case presentation, key concepts, solutions to the assignment questions in the case, and suggestions for the most effective ways to work this case into a course.