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Johnson Lumber: Bet on the Upside or Avoid the Downside?
Fairchild, Gregory B.; Rourke, Brad Case ENT-0196 / Published March 4, 2013 / 6 pages.
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Product Overview

Johnson Lumber, a family-owned company that was one of the main supporters of their local Virginia area economy, had finished 2005 (its best year on record) with the largest cash reserve it had ever been able to put away...only to lose its planing mill in Ladysmith, Virginia to a terrible fire in early 2006. Now, Johnson Lumber's general manager (James Baker), the president and third-generation owner (Edward Johnson), and the president's son (Frank Johnson) must decide how to move forward in the wake of this blow. They could rebuild the planing mill, but they would have to shut down operations for a year--during which Johnson Lumber would lose many customers and have to lay off at least 50 workers from the struggling surrounding community who depended on the company to support themselves and their families. Should Baker and the Johnsons reach out to other lumber companies in the area and ask to use their planing mills overnight while Johnson Lumber's own mill is being rebuilt? Were there other, better options they could consider?


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  • Overview

    Johnson Lumber, a family-owned company that was one of the main supporters of their local Virginia area economy, had finished 2005 (its best year on record) with the largest cash reserve it had ever been able to put away...only to lose its planing mill in Ladysmith, Virginia to a terrible fire in early 2006. Now, Johnson Lumber's general manager (James Baker), the president and third-generation owner (Edward Johnson), and the president's son (Frank Johnson) must decide how to move forward in the wake of this blow. They could rebuild the planing mill, but they would have to shut down operations for a year--during which Johnson Lumber would lose many customers and have to lay off at least 50 workers from the struggling surrounding community who depended on the company to support themselves and their families. Should Baker and the Johnsons reach out to other lumber companies in the area and ask to use their planing mills overnight while Johnson Lumber's own mill is being rebuilt? Were there other, better options they could consider?

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