Academic journal article Journal of the International Academy for Case Studies

Txtbookrental:netflix or Blockbuster?

Academic journal article Journal of the International Academy for Case Studies

Txtbookrental:netflix or Blockbuster?

Article excerpt

CASE DESCRIPTION

This case is designed for undergraduate students in management, marketing and entrepreneurship. The primary actor in the case is Alex Beaver who is in an industry that is facing rapid technological change. Students should be able to have a better understanding of the challenges associated with the credit crises, start up cash flow management, product obsolescence, environmental analysis and creative destruction.

CASE SYNOPSIS

Alex Beaver arrived on campus with aspirations to become an engineer however his entrepreneurial passions quickly led him down a new path. His first year at the university, he began carrying a notepad full of business ideas that he still carries today. His entrepreneurial passion combined with his frustration of high textbook prices caused him to develop a business model similar to Netflix where students could rent a textbook for a fraction of the bookstore price. With a $17,000 cash advance and $15,000 in credit, Alex launched TXTBookRental in 2008. Early on, his business faced significant cash flow problems, because the textbook industry is highly cyclical with peak periods coinciding with the fall and spring semesters. …

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