Nantucket Nectars Case Study Review

Tom Scott and Tom First were entrepreneurs and for about 9 years worked tirelessly performing many of the core operational activities required to manage their company. When the time came for them to decide on how to grow their company, my decision to negotiate an agreement to sell all or a portion of the company stock would have been based on 1) raise capital to support the business’s strategic plan, 2) align new management to perform day-to-day operational and administrative tasks, and 3) pay me a substantial amount of cash so I can pursue other ventures.

Nantucket Nectar’s revenue was a growing rapidly and the brand was receiving well deserved recognition and publicity. And the company’s strategy and dedication to high quality was proving to align well, and was timed well, to the healthy trend of newly emerging beverage industry. However the company’s cost for premium ingredients and operating expenses were very expensive and was leaving the business with net losses during the first 8 years.

Considering the company was receiving unsolicited acquisition interests from several well established beverage companies, many of whom had established supply chain and distribution networks, it would have been a good time to receive premium pricing for shares in the company boost the company’s growth strategy. If I was Tom or Tom with a vote to decide which direction the company should go I would have chosen to sell a portion, or all, of the company to one of the beverage companies like Ocean Spray or Seagram. The purpose of this sale would be raise capital to support the business plan and growth strategy of the company, plus free me from the day-to-day operational activities and allow me to pursue other ventures.

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