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Thank you very much for this article- it was a very interesting topic. I do think a tailwind that could be beneficial to this university is if isolationism trends continue in the U.S. While I don’t know the statistics, I would imagine that competition between Oxford and top universities in the U.S. is high. Should students who are not U.S. citizens see less value in obtaining higher education in the U.S. as job availability decreases for international students here, I wonder whether demand for top tier universities such as Oxford outside of the U.S. will increase. While students here in the U.S. won’t suffer from isolationist trends directly, after school companies are increasingly asking for Visa information and citizenship detail prior along with application submission. So, while applications may be down 7% from students within Europe or Britain, that may change over time if legislation changes in the U.S.

On December 1, 2017, PolkaDots commented on Ice, Cold Corona – Get it here for a 35% higher price! :

All great points you have made. I think the key question is how quickly firms such as Constellation can make changes as outlined above, such as purchasing more bottles from the US or shifting other pieces of operations to the US. This, of course, has to be considered in the context of how much lead time before legislation is passed vs. gets takes affect in the market. Severe changes in business models can have consequences on employees in the plants in Mexico, but I think another key question to ask is how drastic should changes to business models be if a different administration comes in 2 years later and moves the US legal system back towards globalism, away from isolationism. A constant swinging pendulum could paralyze management teams into inaction. This relates to the questions posed at the end of this essay – not only how should management react, but also how do they communicate their reactions to customers and the public without negative repercussions on the brand, vision or management team?

On December 1, 2017, PolkaDots commented on How Monsanto Is Weathering Climate Change :

Monsanto is synonymous with “villain” in many circles. Environmentalists criticizing Monsanto say the carbon neutral initiative is all part of the company’s “moneymaking strategy” [1]. To take people’s focus off of negative environmental impacts the company has on the world, Monsanto is publicly marketing its pledge to distract consumers that they “poison the planet” [1].

Recently, the company’s business model (as you noted above) is no longer just about seeds itself, given the recent acquisitions the company has made. This diversification is providing additional data points to the company so that they can takeover larger market share and beat out competitors. Monsanto was already known – but is increasingly becoming more known as a player that increases vulnerability of monocultures, which puts farmers into agrarian distress – this has occurred in India in particular and become a major issue that has destroyed plots of land and created desolate environments because of the lack of sustainability of the products it sells [2]. With increasing market share, Monsanto has outsized control over what products are used in farming – if they do not claim responsibility for how their products affect our ecosystem, and no other products are available to producers (farmers) at comparable costs, then producers are left with no other options that provide sustainable solutions both to make a living and grow produce.

[1] http://fortune.com/monsanto-fortune-500-gmo-foods/
[2] https://www.globalresearch.ca/the-seeds-of-suicide-how-monsanto-destroys-farming/5329947

Caleb- thank you for the thoughtful essay. I think the question you proposed at the end is highly relevant for us to keep in mind when choosing a company to join post business school. Just like the concept of conflicts between fiduciary responsibility of maximizing shareholder value and sustainability, my mind easily shifts the conversation towards the conflict between this same fiduciary duty and social impact. I am of the hope that our generation will make environmental and social impact top of mind when making business decisions in the future, and that society as a whole will begin requiring data and actions to be taken that follow up on these critical missions. For public companies in particular, environmental / social responsibility is often at odds with shareholder return – I too question whether the public markets will ever assign any value to these causes, or if we as business leaders will have to be a change agent so that companies build these practices into business models from the very beginning. The challenge in the long run is whether or not we can make environmental/social impact solutions profitable and so integrated that the mindset of the general public shifts to not think of shareholder return and these concepts as conflicting.

Thank you for the essay – this is a very interesting topic. Given the capital investment required for distribution businesses and the rapidly changing supply chain here in the US, it is clear DI is facing critical decisions on what direction to take their business in and how to fend off Amazon. At high level, I agree DI should focus on the value proposition they provide to customers (convenience, customer service, etc.) and continue to perfect its e-commerce platform.

One interesting view point that comes to mind when thinking about planning for the future is making sure DI is serving the right customers that will stick with them. There is a difference between selling products through Amazon as a “1PL” customer, a “3PL” customer or a FBA customer [1]. In the FBA model, Amazon is actually taking inventory risk, using their warehouses / facilities to house the products and then shipping to consumers. However, many businesses are doing their own drop-ship directly to consumers via the 1PL and 3PL models. DI can make sure to target 1PL/3PL Amazon customers to preserve their value add in the long run, fulfilling shipments for various customers at a comparable cost.

[1] https://www.spscommerce.com/blog/amazon-fulfillment-options-spsg/

On December 1, 2017, PolkaDots commented on Walmart in the Face of Isolationism :

I made a mistake- what I meant to say was $25B, not $250M – not sure how I didn’t catch that- thank you for the heads up! Point being that their $250B is an aggregate total spanning 10 years (2013 – 2023). So for me, the point still stands that $25B per year is ~5% of sales annually is still low penetration.

I agree that digitization and supply chain efficiency is at the core of change management programs as retailers shift from traditional brick and mortar strategies to omni-channel business models (retail, wholesale and e-commerce). I believe large businesses such as Nike, with strong brand presences, should continue selling through all available distribution channels even as their own model becomes more efficient. This includes specialty retailers — Nike currently sells through 900 doors and these respective online platforms (to the extent they exit).
Consumers may have to go direct to seller in order to obtain access to breadth of products, but first entry or introduction to a product comes in many different forms for various end consumers. Nike’s decision to sell through amazon did tarnish the already strained relationship with Nike’s 900 independent doors. Unfortunately, these doors have an “outsized influence on the brands that serious runners choose and who set the trends that others follow” [1].

While it is true that specialty retailers have found a way to coexist with Amazon through its seller partnership offering, it is still a tenuous situation when volume-driving brands such as Nike decides to add Amazon distribution. These stores, in turn, provide less support on the customer front in terms of brand exposure, thus leaving room for competitors to take market share.

[1] https://www.forbes.com/sites/pamdanziger/2017/06/27/nike-selling-on-amazon-and-what-it-means-for-specialty-running-retailers/#275af4387f21