Dumb Business Decisions

Jim Keyes, 7-Eleven (NYSE: SE) convenience stores
We packaged a more convenient pantyhose for ladies and it has helped us to bring more female shoppers into the store, but we were a little bit out there when we introduced fishnet hose at 7-Eleven Stores. I would say that was one of the dumber decisions.

Dick Kinzel, Cedar Fair (NYSE: FUN) amusement parks
We put a $4 million building around this dog ride and named it “Disaster Transport.” I still remember on opening day a gentleman walked out of the ride and came over to me and said, “You named that one right — that’s a disaster.” And you know what, he was right. That was by far the dumbest thing I ever did.

Bob Wright, ConAgra Foods (NYSE: CAG) Butterball Turkey unit
We had a promotional event a couple of years ago where we were trying to convince people to use turkey in the “off season.” We created an event called “Thanks Grilling” and we invited the public to celebrate with us. But, quite frankly, we way underdelivered the amount of food and drinks that we needed and wound up sending a whole lot of people home with coupons.

Steve Sanger, General Mills (NYSE: GIS)
One of the dumber ones was at the time we announced the Pillsbury acquisition. I boldly told the market that I thought we could get through the regulatory review and close the deal in six months or less. That may have been what I thought, but given that we were dealing with the United States government, it was not within my control. So 18 months later when we closed the deal, I found myself having to apologize for the fact that my prediction was so far off.

Jeff Bezos, Amazon.com (Nasdaq: AMZN)
The biggest mistake we made was our investment strategy during sort of the land rush phase of the Internet. We invested in companies like Living.com and Pets.com. Those investments didn’t work out well and we wasted a bunch of money.

Jim Sinegal, Costco (Nasdaq: COST) food warehouse
I suppose it was exiting the Midwest, which we did about 15 years ago. We opened up in the Midwest and we were not immediately successful and we exited, and I think it took us a long time to get up the courage to go back into that market. Had we stayed the course at that point in time we might have been much more successful in the Midwest today.

Bob Davies, Arm & Hammer maker Church & Dwight (NYSE: CHD)
In the middle ’70s, we went zooming into the personal deodorant and antiperspirant business with an aerosolized can of baking soda. We had two huge problems. Many of the cans clogged, and those that didn’t clog did worse — they massively stung people’s underarms. We lost around $6 million in that venture and that was back when we were a tiny little company. I almost lost my job.

Fred Smith, FedEx (NYSE: FDX)
My dumbest idea was probably to appear as myself in the Tom Hanks film Castaway, which proved that my acting ability was worth the 18 seconds they gave me in the movie.

Jack Soden, Elvis Enterprises, the business entity created by the estate of Elvis Presley
We licensed a company that made bedroom slippers. They were big, furry slippers and they had this rubber image of Elvis’ head on the toes. It was one of those things that when you saw them in the store, it was like, “What were we thinking?” We pulled the license and got them off the market as fast as we could.

Ron Sargent, Staples (Nasdaq: SPLS) office products stores
April 22, 1996. Obviously, it’s burned in my mind. That was the day we flipped on a new computer system. That decision brought us to our knees in the business and it probably took us a year to dig ourselves out. If there’s a lesson for me, it’s to be maybe less date-driven and more event-driven. It’s a lesson I’ve used very well since then, that there’s no substitute for extensive testing when it comes to IT systems.

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One Response

  1. […] Brainlessworld (brainlessworld.net) wrote an interesting post today on Dumb Business DecisionsHere’s a quick excerptDumb Business Decisions Posted on October 22, 2007 by brainlessworld Jim Keyes, 7-Eleven ( … . I boldly told the market that I thought we could get through the regulatory review and close the deal […]

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