The dangers of adjacencies strategy are explored. While entering adjacencies seems logical for growth, it can distract companies from opportunities in their core business and dilute their capabilities. Many retailers, airlines, and other companies have pursued adjacency strategies only to later reverse course as the promises of growth proved illusory. For big-box retailers specifically, expanding into small formats risks averaging down their capabilities and undermining advantages of large store operations. However, not all adjacency moves fail; some companies like Apple, Berkshire Hathaway, and Roche have succeeded through adjacencies, and lessons from them will be discussed in the next post.