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An Idea A Day by David Thompson

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STRATEGY

TURNING THE SUPPLY CHAIN INTO A REVENUE CHAIN

Jeremy Kourdi

The idea

In the 1990s, the leader of the video rental market, Blockbuster, found itself frustrated by never having enough copies of popular movies in stock to satisfy demand at peak times. The problem was that Hollywood studios charged $60 per video, while demand typically fell sharply a few weeks after release. Consequently, Blockbuster could not justify purchasing more than ten copies of a movie, leaving many ...

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