[Column] The moment the decision to scrap and build is made, the management has lost.

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The term "scrap and build" has various meanings depending on the context in which it is used, not limited to store closures. It means "to break down the current situation and create something new," with the goal of breaking through a stagnant status quo. A typical example of this term in corporate management is when companies in the food and retail industries are expanding their locations, and some of those locations become unprofitable, leading to the prediction that they cannot be recovered in the future. In such cases, the unprofitable locations are closed (scrap), and new locations are created (build). In this scenario, there are always cost burdens that would not have occurred without the scrap and build process. Depending on the situation, these costs can be quite significant. Therefore, unless a manager is strategically choosing to implement scrap and build, they would typically take measures to avoid it by accumulating various hypotheses and validations. *For more detailed content of the column, please refer to the related link. *For more information, please check the PDF materials or feel free to contact us.

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