The behaviour of the guy you talk about was incredibly irresponsible. Stretched that thin, the slightest hiccup could have brought the whole operation crashing down. Worse still, he wasn't gambling with his own money. His failure would have cost his friends and family, the suppliers who gave him credit, and, in his struggles to stay afloat, he likely would have ruined the finances and reputation of the business he took over. Lastly, in the event that he had failed, the original sellers of the business would end up with nothing but the initial deposit (and the pain of watching their hard built business run into the ground by an idiot).
It's also worth pointing out that the guy's plan of action was pretty stupid. If the suppliers had paid the slightest bit of attention, maybe even talked to each other a bit, they would have found out what he was doing, and refused his request. The long term good history of the business wouldn't count for anything if it became known that the owner was up to his eyeballs in high interest debt and had just sold off all his stock. I mean seriously, his plan hinged on the suppliers not noticing that all his stores were empty.
The story probably isn't true, but if it is, then it isn't something to aspire to. It's a story about a guy doing something very unethical (if not fraudulent). It's a story about a guy taking massive risks with other people's money in order to benefit only himself.
If your idea of competitive advantage is doing something that only helps you and harms others, then you shouldn't evangelise about it. For one thing, it can only hurt you in the long run if other people pick up your ideas and act this way.
I agree with you, and perhaps i used a poor example, i was just saying that there is sometimes an alternative route, i'm not saying that you should take it though, but i think being aware of it would be valuable.
I've heard a similar story before - at least the using loans to buy assets, and using those to get more loans bit. I can't remember who, but I think it was someone who is pretty famous (and wealthy) now.
I don't disagree with your reasoning, but I think your result is completely off the bat. The thing is sometimes you have to take big risks to get big rewards, and if you play it with enough of an edge you can win. Whether or not you think it is unethical or not right, in reality I think this is how a lot of businesses are actually run.
It's also worth pointing out that the guy's plan of action was pretty stupid. If the suppliers had paid the slightest bit of attention, maybe even talked to each other a bit, they would have found out what he was doing, and refused his request. The long term good history of the business wouldn't count for anything if it became known that the owner was up to his eyeballs in high interest debt and had just sold off all his stock. I mean seriously, his plan hinged on the suppliers not noticing that all his stores were empty.
The story probably isn't true, but if it is, then it isn't something to aspire to. It's a story about a guy doing something very unethical (if not fraudulent). It's a story about a guy taking massive risks with other people's money in order to benefit only himself.
If your idea of competitive advantage is doing something that only helps you and harms others, then you shouldn't evangelise about it. For one thing, it can only hurt you in the long run if other people pick up your ideas and act this way.