Case Study #$1-$ Pages $364-373$

TOMS Shoes is a for$-$profit business with a large philanthropic component. The company was started after entrepreneur Blake Mycoskie witnessed the poverty among villagers in Argentina, poverty so extreme that the villagers could not even afford a pair of shoes. Mycoskie returned to the United States with $200$ Argentinian shoes and a mission. He went from one retail store to another with a unique business proposal. He would start an organization that would provide a pair of shoes for an Argentinian child in need for every pair of shoes purchased from his business. After many meetings and discussions, a few Los Angeles boutiques agreed to sell the shoes. Mycoskie$$s story was eventually picked up by the Los Angeles Times, who ran an article on his extremely unique business. To his surprise, the following weekend garnered $$88,000$ in orders. The orders didn$$t slow down there, and two years after officially establishing TOMS, the business had $$9\mathrm{.}6$ million in revenue.

Most firms do not want other companies to copy their successful business model. However, the shoe retailer TOMS is not your typical retailer, and the firm$$s business model is unusual, to say the least. While many organizations try to incorporate social entrepreneurship into their business operations, TOMS took the concept of philanthropy one step further by blending a for$-$profit business with a philanthropic component in what they termed the One for One model. For every product purchased, TOMS donates products or resources to help those in need. The cost of providing the products to those in need is already built into the products$$ sales price, turning the customer into the benefactor. The philanthropic component is just as important as the for$-$profit business for TOMS. TOMS$$s goal is to be able to turn a profit, support themselves, make the world a better place, and educate consumers, all at the same time.

$1.$ Why was it necessary for TOMS to evolve its business model?

$2.$ Who are TOMS$$ most important stakeholders, and why?

$3.$ Is the One for One movement business model appropriate for any other businesses?