Electronic Retail Store Crazy Eddie - Case Study Example

The main reason for the failure is the inability to manage the firm. Since the management comprised of his relatives, Antar did not bother to look after the financial and investment needs. All this contributed to the problematic situation. The critical issue in Crazy Eddar's case is the fraudulent activity of increasing the company's profits in the company's balance sheet. This was purposely done by Antar to tide over the situation that prevailed during the 1980s. Antar thought it would solve the financial issues.

But it resulted in a problem that provoked the problems in the company's investment. There were several other issues that contributed to the problems in Crazy Eddie. Antar lacked experience in managing stores and he relied on his relatives to help him whenever there was a problem in the company. The company had tremendous growth in the initial stages and Antar strived hard to maintain the status of the company. Though it was well-received and people often visited the store, the increase in the competition created a wave of fear.

measure to gain investment and capital to improve the company and to expand its operations. Even though this seemed to be a good option, this led to a situation where people started investing more in this company. Due to this, the level of expectation increased. The shelves of the shop were filled with electronic items and most of the items remained there for a long time. The sales decreased gradually since people started to buy from the other retail electronic stores. Without resolving the situation Antar continued to open up new branches.

(Knapp, 2009).As the competition increased the number of customers got reduced. This affected the growth and expansion of Crazy Eddie and the profits started to decline. Even the suppliers were reluctant to provide them the necessary electrical types of equipment. This led to a situation where Antar's relatives lost interest and they started to disintegrate. The company's financial condition was not stable and in spite of the increase in the share value. Antar then returned the procured electrical goods back to the suppliers.