2010) is provided below. 1167872 4 Despite the leading position and the good business results, SWOT shows several sources of potential risks for UST. The company is losing market share against new price-value competitors because of slow innovation and late product introduction and extensions. Historically, UST relied on his leading market position boosting earnings with annual prices increases. But in the meanwhile smaller competitors started to quickly erode market share with prices cut.
Profit along with sales has continued to grow at a steady rate. SureCut Shears is looking to modernize it’s plant and is looking to take a loan from Hudson National Bank to do cover the costs of it. Analysis: SureCut Shears in theory should be able to pay off its loan to the bank on time. One reason the company is finding it can’t is because of its continual decline in sales during the period of time the loan was to be paid off. The retailing recession was what the company believed caused this decline in sales.
On the other hand MI backed mainly by shareholders equity and performing assets and thus would be able to issue new debt increasing value for both shareholders and the corporation. Thus the shareholders would gain at the expense of bond holders and the equity value of the company would increase. b) Bondholders Bondholders had a lot to lose as according to Project Chariot almost all the debt would be assigned to HM. Given the problems in real estate and hotel markets there was a concern of HM’s ability to meet its debt payment and there was a high probability of default. This meant that the risk was issued at investment grade but now was not backed by valuable assets of the companies which were to be spun off to MI which was to be backed by equity.
First problem we encountered were the current and quick ratios were unusually high due to the amount of cash, receivables and short term investments that Krispy Kreme held. This is an indication that the company was not investing in other projects and remained conservative with regards to the treatment of current assets from 2001 to 2004. The net sales, receivables and inventory turnover were much lower compared to the industry, but ultimately the profit margin and return on equity remained consistent which we considered questionable. The leverage ratios were lower than the industry; the company used debt to make payments and took a line of credit. Although cash reserves were high and debt was very low, the cash ratio was lower
Case Write up WAL-MART STORES: “EVERYDAY LOW PRICES” IN CHINA Executive Summary Despite its humble beginnings in Arkansas in 1962 the first Walmart that Sam Walton opened generated sales of $975000 and 17 years later after expanding and opening several more stores, their sales “surpassed $1 billion.” Mr. Walton's insistence for discount prices or “Every day low prices” as well as tactics like opening discount stores in towns of less than 50,000 people, thus barring other competitors like Kmart by meeting the market's demands, led to his rapid expansion and growth. Walton's idea of pinching every penny the company earned encouraged efficiency within the company and also drove its suppliers to increase efficiency to meet its demands. Proof of miserly conduct is further shown by the fact that employees, even top level CEOs, that travel for Walmart on business are known to ride in coach class seating and even split a $49 a night room to save a couple bucks. Despite being ranked as #1 in Fortune 500 in 2002 and named the most admired company by Fortune in 2003 and 2004, they still sat at 20th among the top 25 chain stores in China. One of its world competitors, the French Carrefour, ranked 5th and unlike Walmart had begun to see numbers in the black.
The company also launched an online platform and soon became one of the biggest financial services in the industry. However in the early 20’s the customer started loosing trust in the brand and consequently revenue was declined by 39% and ultimately company lost its market share. To recover from this damage, company has launched the “Talk to Chuck” campaign in 2005. The main idea behind the campaign was to give the clients a feeling as if they talked to Chuck. The marketing team wanted to control the risk of this campaign, for any unseen events, so they have planned to test TTC campaign in three major cities Chicago, Denver and Houston (which account for only 6% of Schwab’s invested assets with a test cost of $15 million.
Dollar General in owned by Koldberg Kravis Roberts & Co. L.P (KKR) who own more than 79% of all shares in Dollar General. Some argue that part of the reason Dollar General has been so successful as of late is attributed to the economic crisis the United States experience during the second half of the 2000s. Economist believe that consumers will not shop at the Dollar General as much as the economy improves. In an effort to retain their existing customers and recruit new ones as the economy strengthens, Dollar General has begun to stock name brand items. Some analysts also believe that even when the economy improves, your average consumer will still look for ways to save money and continue to frequent the dollar discount stores.
However, exhibit 6 showed that there was a decline in market demand for conventional lenses, but an increase in both planned replacement and disposal lenses. B&L does not produce either of those products, yet the reports indicated a healthy growth in revenue. This increase was largely due to sales revenue recognized from the 1993 large volume shipment to the distributors, transferring inventories from B&L to various distributors and recognized as revenues to B&L. This strategy not only increased the revenue for the year significantly but also reduced the excess inventory held by B&L, and increased their AR significantly, thus portraying a positive outlook on the Balance Sheet. 2.Does the new distribution and sales strategy make sense from an operational standpoint? Why or why not?
They believe in making better on product availability and inventory, the real risk that the customers take their basket elsewhere when there are items out of stock will be reduced. However, there are few factors which greatly affected the company’s total revenue. One of the factors is the continued store expansion activities. Each additional store may take away sales from the existing units. That’s why the Walmart management started to plan a slower new store growth, so that the impact of new stores on comparable store sales will be stabilizing over time.
Keith Martin is the CEO of Outsource Inc., a rapidly expanding information services company. He is concerned with the company’s current stock performance compared with the competition. They match up well with the others based on traditional measures like return on equity and earnings per share. However, OSI stock has not increased nearly as much as the other firms. As CEO, Keith is determined to figure out why OSI stock is not performing as expected.