Interesting post, thanks! I would think dual mission organizations – for-profit but also with a philanthropic edge – would struggle more with aligning their business model and operating model, and TOMS seems to be an example of this.
Perhaps a cynical point of view, but I question if people buy TOMS for the easy feel-good moment of “Buy one, give one” or if they are really looking for TOMS to create the more lasting community impact (or if it’s just because they like the products). If TOMS believes it’s the larger impact that appeals to people, wouldn’t it make sense to move away from the “Buy one, give one” model in order to channel that money toward the larger community products?
Thanks for the interesting post! Whole Foods’ current value proposition is providing organic, high-quality products and a fun in-store experience. Given that, it’s interesting to hear that they will be opening a chain of smaller less-expensive sister stores, as that seems to go against their current business model. I wonder how they will position the new stores in the competitive landscape and what about their operating model will have to change to support that.
Interesting post, thank you! I understand the point about maximizing asset utilization to reduce the cost base in order to offer low fare tickets, but I wonder where the tradeoff point is between utilization and maintenance/replacement costs. I would imagine that the higher average daily utilization of the planes would mean they need more maintenance and ultimately need to be replaced sooner than other airlines’ planes (and then reconfigured for the higher seat density), which would increase costs.
If I remember correctly, Spirit’s transition to being an ultra-low-cost-carrier coincided with the recession, when the idea of a low cost, no-frills flying experience was very palatable to people. Even though the economy has improved, I believe people are still being cautious about spending, especially on discretionary items such as flights. As we get further away from the recession though, I wonder if there will start to be a backlash against the unpleasant no-frills experience, or at least not enough new people willing to sign up for it, thereby inhibiting Spirit’s growth.