Blockbuster's Failure Analysis & Keys to Success in Small Business

This essay examines the reasons behind the failure of Blockbuster Video Company, a once-dominant brand in video rentals that went bankrupt in 2010. The analysis points to the company's inability to adapt to changing market trends and its rejection of a potential acquisition by Netflix. The essay also highlights key personality characteristics for successful small business ownership, including persistence, effective financial management, and understanding market trends. The failure of Blockbuster resulted in unpaid employees, suppliers, and rent arrears, leaving a legacy of debt and highlighting the importance of adaptability and strategic decision-making in the business world. Desklib offers a variety of resources for students, including similar solved assignments and past papers.

Running head: FAILURE OF BLOCKBUSTER COMPANY 1
Failure of Blockbuster Company
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Blockbuster Video Company was established in the year of 1985. It was one of the most
known brands for video renting space. The company was at its peak in the year 2004. During
this time, the company paid well its employees due to the profits it was making. The company
became known all over the world because of its success. However, as time went by, the business
of the company went down. Therefore, an exploration will be done showing why the company
failed and the personality characteristics for the successful small business ownership.
Blockbuster video company failed due to bankruptcy in the year of 2010. This is because
the company failed to maintain its services to its customers. It was even unable to pay its
employees. Due to the company unable to thrive in the business industry as they were before,
Netflix Company approached the CEO of Blockbuster asking him to sell the company to them.
However, the CEO of Blockbuster company was never interested because he felt that the offer
was “very small niche business”. It did not take long before the company crumbled and finally it
was closed down. Many employees were left unpaid. Most of the suppliers also remained unpaid.
The rented stores world-wide were not paid their rent arrears since the company was falling.
Generally, the company closed down indefinitely having a lot of debts that remained unpaid up
to date (Greenberg, 2010).
In relation to the above case, there are some personality characteristics which can make
the business a success. One of the characteristic is that of persistence. As a business, there should
be persistence in terms of supply and even production. The other characteristic is that of
managing funds well. Lack of budgeting can make the business close down. Therefore, the
business should have that ability of knowing how to manage the funds of the business (Jenkins,
2009). The other characteristic is that of learning the market. As an entrepreneur who intends to

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make his or her small business grow and become successful, he or she should know market
trends.

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References
Greenberg, J. M. (2010). From BetaMax to Blockbuster: Video stores and the invention of movies on video. MIT
Press.
Jenkins, H. (2009). A ‘business opportunity’model of corporate social responsibility for small
and medium‐sized enterprises. Business ethics: A European review, 18(1), 21-36.