AREUFIT Health Services Inc.: CEO Faces Strategic Crossroads

In the summer of 2018, after over 25 years of leading AREUFIT Health Services, Inc. (AREUFIT), the founder and president of assessed her company’s position in the evolving health services market. She had grown AREUFIT from a sole proprietor start-up to its current position as the Philadelphia region’s award-winning provider of preventive health and biometric screenings, corporate health and disease prevention programs, and wellness services, with annual revenues that exceeded US$1 million. The founder had spent the last three years working with an outside consultant in preparation for the next stage in the life cycle of her company. When a competitor approached her with an offer to buy AREUFIT she knew she had to make some tough decisions, while remaining true to her values and business practices. She wanted to preserve the company and culture she had built, protect her key employees, and ensure that the brand reputation of AREUFIT would endure.

This case study may be used in a senior undergraduate- or graduate-level course on strategic management late in the semester to show how firms manage and adapt capabilities to meet the challenges of changing general and industry environments; or it can be used in a course on entrepreneurship to illustrate the decisions that an entrepreneurial founder faces as she thinks about next steps for her firm. After the completion of this case, students will be able to<ul><li>analyze the changes in the external environment to understand the impact on the industry and firm;</li><li>identify industry boundaries, and analyze the industry using Porter’s Five Forces;</li><li>analyze the firm’s resources and capabilities to determine core competencies that may be leveraged for growth, or that may need development or adaptation to address the changes in the environment;</li><li>understand the firm’s generic strategy and how it is positioned relative to competitors;</li><li>consider developing relationships with partners and potential suitors;</li><li>understand issues related to new or different business models (e.g., partnership, alliance, franchising, acquisition); and</li><li>understand the issues founders face when considering growth and exit options.</li></ul>

• wellness, entrepreneur, exit strategy