Death of a business empire

[cu@thetop]

The collapse of a once wealthy beer family in the U S of A.

http://www.forbes.com/sites/kerryad...wittersf&utm_source=twitter&utm_medium=social

Interesting story.

 

[RPI]

Great article. Thanks

 

[Michael_X]

Very good read!

 

[Ausprop]

how depressing. businesses come and go, must never forget that

 

[The Fence]

Got drunk on credit.

 

[china]

All empires come and go. How can you expect someone four generations from the hungry immigrant founder to have a fraction of the drive of the originator when they are living off massive trust funds?

 

[The Fence]

Agree, usually its the 3rd gen that buggers it all up.

 

[TMNT]

Not knowing much about beer except I don't like it

I always think to myself when these stories come to life

Was it incompetence, bad luck or inevitable?

As mentioned, sure following generations are probably going to ruin it but if people stopped drinking beer for example, then no degree of business genius is going to save your business, especially if your main product line is beer

Some of the busienss decisions made seem bad in hindsight, but if your business is declinigng, you have to try new things or weather the storm

Great reading though

 

[MTR]

Did a little further research on this, so basically, the market changed, public wanted healthier options, sales dropped. The company continued borrowing money and spreading their wings into other ventures where they had little/no expertise/experience and spiralled into further debt and lost a fortune.

Thanks for the link, it was a very good read. How to lose a fortune 101... yikes

Cheers
MTR

 

[MarkB]

Agree, usually its the 3rd gen that buggers it all up.

What's your evidence?

 

[roe]

if you enjoyed that ..you may enjoy this book

http://www.amazon.com/How-The-Mighty-Fall-Companies/dp/0977326411

When my stocks reach for
Stage 2: Undisciplined Pursuit of More
I am quiting

 

[Macca]

Poor management decisions will kill anything quick smart, just because the person is a relative does not mean they have the nouse to run a huge business.

Look at how many companies appoint fully qualified MBAs and they still stuff up, so keeping it all in the family just increases the risk.

 

[TMNT]

What's your evidence?

It's common knowledge

Obviously a generalisation, but a high degree of accuracy

 

[Rolf Latham]

Survival is not mandatory

many many businesses at all levels have the Ostrich Syndrome as do we personally

ta
rolf

 

[VYBerlinaV8]

Poor management decisions will kill anything quick smart, just because the person is a relative does not mean they have the nouse to run a huge business.

Look at how many companies appoint fully qualified MBAs and they still stuff up, so keeping it all in the family just increases the risk.

I'm curious as to why people hold MBAs in such high regard, the course doesn't look that tough. Are they really that useful?

 

[MarkB]

It's common knowledge

Obviously a generalisation, but a high degree of accuracy

So you'll have lots of examples you can point to then?

 

[TMNT]

So you'll have lots of examples you can point to then?

Yeah! Google is a good start

 

[MarkB]

Yeah! Google is a good start

Should be easy for you then....

A statement has been made - "usually its the 3rd gen that buggers it all up" - and it has been been passed off as common knowledge and highly accurate, but I'm yet to see evidence of that.

Because without evidence it is tosh.

I'm happy to be proven wrong, but then I'm not the one making as yet unsubstantiated statements.

 

[VYBerlinaV8]

Anecdotal only (so not evidence), but the three generations thing is exactly what is happening with my wife's extended family. Grandparents came out with nothing, busted their cans, built some wealth and encouraged children to pursue tertiary education. Kids kick butt, all become doctors, lawyers, engineers, end up doing extremely well. Grandkids brought up in luxury, mummy and daddy pay for everything and generally show off how much wealth they have, grandkids end up useless.

Most of these grandkids are now in their 30's and 40's and have achieved nothing on their own at all.

 

[Macca]

I have two examples

One family were huge in their field in Newcastle, when the founder died he left 100mill to his kids in the 1960's. They split some up and kept the business going........ slowly down hill

They left 100mill to the next generation in the 90s who then closed the business to stop the bleeding, the next generation are having a lot of fun spending and drinking it

On a smaller scale, business employing 100 people is left to son, loses money hand over fist, employs manager who says after 3 months we need to refinance or sell business. Business sold capital invested and used to live on, the next generation will get 10% of what the "son" inherited to be split 4 ways.

An successful entrepreneur is a unique type of person, they are a combination of all sorts of skills but when you combine that with the ability to manage a business these people are very rare indeed.