Longevity in Services: The Case of the Dutch Warehousing Companies 1600-2000

Abstract

In this paper, we explore the factors that determine the longevity of firms. Five central factors were distilled from the literature: position in the supply chain, the nature of the technology used, structure, culture, and financial policy. We made an extensive case-study of the Dutch storage company Royal Pakhoed and its predecessors from the early seventeenth century to the present. We conclude that all five factors contributed to the longevity of Pakhoed, but to a different degree. Paradoxically, its dependent position in the supply chain enhanced Pakhoed’s longevity because it led to a high absorptive capacity. The technology used proved to be surprisingly flexible and versatile. The structure was characterized both by centralized and decentralized features throughout the ages; decentralization enhanced continuity in several cases. The company’s culture has been always rather ‘open’, but it restricted the range of successful diversification beyond storage and warehousing. A conservative financial policy helped one of Pakhoed’s main predecessors to survive throughout the nineteenth century, but this factor seems to have been of relatively minor importance after the Second World War. In this paper, we explore the factors that determine the longevity of firms. Five central factors were distilled from the literature: position in the supply chain, the nature of the technology used, structure, culture, and financial policy. We made an extensive case-study of the Dutch storage company Royal Pakhoed and its predecessors from the early seventeenth century to the present. We conclude that all five factors contributed to the longevity of Pakhoed, but to a different degree. Paradoxically, its dependent position in the supply chain enhanced Pakhoed's longevity because it led to a high absorptive capacity. The technology used proved to be surprisingly flexible and versatile. The structure was characterized both by centralized and decentralized features throughout the ages; decentralization enhanced continuity in several cases. The company's culture has been always rather 'open', but it restricted the range of successful diversification beyond storage and warehousing. A conservative financial policy helped one of Pakhoed's main predecessors to survive throughout the nineteenth century, but this factor seems to have been of relatively minor importance after the Second World War.

Keywords: longevity, business history, port and warehousing business

JEL Classification: M, L20, D23, N74, N73