br />Challenges Facing a New CEO
Joyce P. Vincelette, Ellie A. Fogarty, Thomas M. Patrick, and Thomas L. Wheelen
A teddy bear is almost a 100-year-old product that has been made in every conceivable
size, style, fabric, and price combined with a saturated market. Yet the teddy bear industry
stands as a model of strength and durability. Every year, bear makers create and market
hundreds of original models.1
Vermont Teddy Bear Company was founded in 1981 by John Sortino selling hand-sewn
teddy bears out of a push-cart in the streets of Burlington, Vermont. Since this time, the
company focus has been to design, manufacture, and direct market the best teddy bears
made in America using quality American materials and labor.
Until 1994, Vermont Teddy Bear experienced a great deal of success and profitability.
Problems arose in 1995. Since 1995, the company has had two CEOs. It changed its name
to The Great American Teddy Bear Company and then changed it back to The Vermont
Teddy Bear Company when customers got confused. From its inception, Vermont Teddy
had been known for its Bear-Gram delivery service. In 1996, the company decided to shift
emphasis away from Bear-Grams to other distribution channels. By 1998, the company
decided to renew its emphasis on Bear-Grams. Vermont Teddy has always been proud of
the fact that its teddy bears were made in America with American materials and
craftsmanship. In 1998, the company changed this philosophy by exploring the offshore
sourcing of materials, outfits, and manufacturing in an effort to lower costs.
