To Expand or Diversify? Decision-Making at Positive Identity

Joanna Pitek
8 pages
allocation of capital; market expansion; market diversification
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A successful apparel and promotional products company must decide whether to expand existing lines of business or to diversify into a new line of business.


This case is based on a real company that sells decorated apparel (primarily uniforms and scrubs), and promotional products in London, Ontario. After 35 years of operations, the company is now facing a strategic decision in terms of the future identity of their organization. Their biggest competitor has just closed down shop in the London area, and the organization has been able to lease the competitor’s business space. Management must now decide whether to continue expanding their business lines and use this new space as a second location of decorated apparel; or, whether to capitalize on the extensive growth in the construction industry within Southwestern Ontario and diversify their product offerings to include specialized industrial workwear. This is a decision-based case, which asks students to take on the role of management, provide an analysis of the situation, and provide a recommendation as to: Whether the company should expand their existing product line or diversity their product offerings; How this decision will affect the structure of the organization, including new personnel requirements and; communication and leadership plans to motivate the existing personnel.

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