EECS 1520 Lecture Notes - Lecture 7: Chief Financial Officer
21 Jun 2018
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EECS 1520 Lecture 7 Notes
Introduction
Chief financial officer
In light of these circumstances, Ben Holt, the company’s chief financial officer (CFO), is
contemplating his alternatives for Blades’ future.
There are no other cost-cutting measures that Blades can implement in the United
States without affecting the quality of its product.
Also, production of alternative products would require major modifications to the
existing plant setup.
Furthermore, and because of these limitations, expansion within the United States at
this time seems pointless.
Holt is considering the following: If Blades cannot penetrate the U.S. market further or
reduce costs here, why not import some parts from overseas and/or expand the
company’s sales to foreign countries?
Similar strategies have proved successful for numerous companies that expanded into
Asia in recent years to increase their profit margins.
The CFO’s initial focus is on Thailand.
Thailand has recently experienced weak economic conditions, and Blades could
purchase components there at a low cost.
Holt is aware that many of Blades’ competitors have begun importing production
components from Thailand.
Not only would Blades be able to reduce costs by importing rubber and/or plastic from
Thailand due to the low costs of these inputs
It might also be able to augment weak U.S. sales by exporting to Thailand, an economy
still in its infancy and just beginning to appreciate leisure products such as roller blades.
While several of Blades’ competitors import components from Thailand, few are
exporting to the country.
Long-term decisions would also eventually have to be made
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Document Summary
In light of these circumstances, ben holt, the company"s chief financial officer (cfo), is contemplating his alternatives for blades" future. There are no other cost-cutting measures that blades can implement in the united. States without affecting the quality of its product. Thailand has recently experienced weak economic conditions, and blades could purchase components there at a low cost. While several of blades" competitors import components from thailand, few are exporting to the country. Long-term decisions would also eventually have to be made. Maybe blades, inc. , could establish a subsidiary in thailand and gradually shift its focus away from the united states if its u. s. sales do not rebound. No other cost-cutting measures that blades can implement in the united states without affecting the quality of its product. Also, production of alternative products would require major modifications to the existing plant setup. Furthermore, and because of these limitations, expansion within the united states at this time seems pointless.
