This case examines how Capos’ focus on extraordinariness as contributed its success. First, histamine the history of Capos, its core values, and its unique business model. Next, we analyze the company’s corporate culture and how it influences its relationships with employees, customers, the environment, and communities. We then look at some of the challenges the company has faced and how it plans to move into the future. HISTORY Nick Swimming founded Capos in 1999 after a fruitless day spotlighting foreshores San Francisco.

After looking online, Swimming decided to quit his Job and start a shoe website that offered the best selection and best service. Originally called Shiite. Com, the company started as a middleman, transferring orders between customers and suppliers but not holding any inventory (a “drop ship” strategy). The website was soon renamed Capos, after the Spanish word foreshores (Saputo). In 2000, entrepreneur Tony Whish became the company’s CEO. Whish, 26 at the time, was an early investor in Capos, having made $265 million selling his startup company to Microsoft in 1998.

Whish wasn’t initially sold on the idea of an Internet shoe store. He told Inc. Magazine, “It sounded like the poster child of bad Internet ideas… But I got sucked in. ” After coming CEO, Whish made an unconventional decision to keep Capos going, even selling his San Francisco once setting his salary at Just Capos struggled forts first few profit. The dot. Com crash forced company recovered. By the end but was still not profitable. In order to offer the best customer loft to pay for a new warehouse and $24. Ears,making sales but not generating a Capos to layoff half its staff, but the of 2002, Capos had sales $32 million 2003, the company decided that in service, it had to control the whole value chain?trot order to telemeter to delivery?and began holding its entire inventory. Capos moved to Lass Vegan’s 2004 to take advantage of a larger pool of experienced call center employees. The company generated its first profit in 2007 after reaching$840 million in annual sales. Capos also started to be recognized for its unique work environment and approach to customer service.

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This material was developed by Harper Bird,Vertebrate Gallons, and Beau Shelton under the direction of O. C. Farrell and Linda Farrell. It is provided for the Daniels Fund Ethics Initiative at the University of New Mexico and is intended for classroom discussion rather than to illustrate effective or ineffective middling of administrative, ethical, or legal decisions by management. Usurers this material are prohibited from claiming this material as their own, emailing to others, or placing it on the Internet. Please call O. C.

Farrell at 505-277-3468 for more information. (2012) 2 In 2010, Amazon bought the company for$l . 2 billion. Although Whish had rejected an offer from Amazon in 2005, he believed that this buyout would be better for the company than management from the current board of directors or an outside investor. Hessian, “With Amazon, it seemed that Capos could continue build its culture, brand, and business. We would e free to be ourselves. ” Amazon agreed to let Capos operate independently and to keep Hashes CEO (at his current $36,000 annual salary).

Whish made $214 million from the merger, and Amazon set aside $40 million prostitution’s Capos employees. After the merger, the company restructured into 10 separate companies organized under the Capos Family. CORE VALUES Capos has ten core values that guidelines activity at the and form the heart of the company’s business model and 2. 3. 4. 5. 6. 7. 8. 9. 10. Deliver WOW through service. Embraced drive change. Create fun and a little weirdness. Be adventurous, creative and open-minded. Company ultra. Pursue gar learning.

Build open and honest relationships with communication. Build a positive team and family spirit. Do more with less. Be passionate and determined. Be humble. Capos’ core values differ from those other companies in a couple of ways. In addition to being untraditional, the core values create a framework for the company’s actions. This is exemplified in the company’s commitment to their customers’ and employees’ well-being and satisfaction. CAPOS’ CUSTOMER-FOCUSED BUSINESS MODEL The Capos business model is built around developing long-term customer relationships.

Capos does not compete on price because it believes hat customers will want to buy from the store with the best service and selection. The company strives to create a unique and addicting shopping experience, offering a wide selection of shoes, apparel, accessories, and home products, free shipping to the customer, free shipping full refunds on returns, and great customer service. Capos strives to make the shopping experience enjoyable. The website is streamlined Forman easy shopping experience.

Products grouped in specialized segments, with some (like outdoor products) on their own mini- sites. Customers can view each product from multiple angles thanks to hotplates taken at the company’s studio, and Capos employees make short videos highlighting the product’s features. Capos customers navigate the site to improve features,adapt search plan inventory. 3 The spirit of simplicity, innovation, and great service extends inventory and distribution systems as well. Capos has one live inventory systems on the web. If the Capos website it is in stock.

Once the company sells out of an item, the removers the website. This helps to reduce customer inventory and sheepishness’s are linked directly to the analyzes how results, and to Capos’ of the few displays item, listing is restoration. Its website via central database, and all its nonproliferation’s are developed in- house and customized to the company’s needs. Their warehouses operate around the clock, which allows them to get a product to the customer faster. Fast sophisticates an instant gratification that is similar to shopping in a physical store.

Most companies have a negative view toward returns, but Capos’ mentality is the complete opposite. It sees returns as the ability to maintain customer relationships and to increase its profits. Capos offers 100% Satisfaction Guaranteed Return Policy. If a customer is not satisfied with purchase, en or seen can return days The customer can print a pre- paid explainable that domestic customers to return the product forbore. This encourages customers to order several styles or differentiates items that do not work out. Tort dull return. Allows all return policy and return the While this strategy seems expensive, it actually works Capos’ advantage. The average industry merchandise return rate is 35 percent, but Capos’ most profitable customers tend to return 50 percent of what they purchase. The customers who have the higher return percentages are the most profitable because they have experienced Capos’ customer service ND return policy, which create loyalty to the company. These customers are likely to make purchases more often and to spend more on each purchase.