Case | HBS Case Collection | March 2011 (Revised June 2013)

Red Hen Baking Company

by Richard S. Ruback and Royce Yudkoff

Abstract

In 2007, the Red Hen Baking Company was deciding whether to move from its cramped and inefficient facility to a new facility. It had been in business about 8 years, and 2006 was the first year RHB realized a profit that was over $50,000. The added annual cost of the new location was about $58,000 and would require a $300,000 build-out. While the owner of Red Hen was excited about the possibility of a new, efficient bakery, he wondered if it was worth the added expense and risk.

Keywords: Entrepreneurship; Capital; Risk Management; Expansion;

Citation:

Ruback, Richard S., and Royce Yudkoff. "Red Hen Baking Company." Harvard Business School Case 211-091, March 2011. (Revised June 2013.)