STAPLES
In 1985, before Staples was established, a retail office supply industry did not exist. Office supplies could either be purchased at large retail stores that sold an assortment of other goods or through wholesalers and dealers. Through the establishment of Staples, consumers realized that they could purchase office supplies at half the price. During this time period companies were consolidating and making retail stores that focused on one industry like Toys R Us. After Tom Stemberg, the founder of Staples, was fired from his job, he saw the need for cheaper office supplies. Leo Kahn, an associate of Stemberg, believed in Stemberg's vision and became his mentor and invested $500,000 into his business idea. Initially, Stemberg thought about going into the supermarket grocery retailing industry, but rejected the idea because of the extreme competition. Stemberg began investigating the need for an office supply industry through conducting interviews on how much money people spent on supplies. He knew that through his vision, he could help consumers save money. Stemberg decided that Staples's target market would be small businesses because he was aware that small businesses did not get the same type of discounts that larger corporations did.
Through Stemberg's compelling arguments and strong belief that Staples was going to become a success, he was able to collect $4 million from Bain Venture Capital in exchange for 50 percent of the company. Stemberg was able to convince the investors that Staples was going to create a new retailing industry. He also showed investors that Staples was a way for consumers to save money. In order to ensure the success of Staples, Stemberg needed a strong management team and the most effective information system. Stemberg hir ...