Acc/561 Wk3 Tootsie Roll Industries Inc. Loan Package

Fuzzy Dice Inc. (“Fuzzy” or “the Company”) manufactures novelty items that it distributes to wholesalers and large online and direct-mail retailers. Fuzzy operates in an area where several other light manufacturers operate, one of which is Tiny Tots Toys LLC (“Tiny”), an educational children’s toy manufacturer. Tiny has been unable to turn a profit for the past few years and has recently filed for Chapter 11 bankruptcy protection.

DG has a current competitive advantage within its industry that is maintains through a unique cost-efficient approach. This low-cost structure is apparent through low inventories, low advertising costs, and location of stores in rural areas. Though profitable in the short-run, DG's current advantage is not

Keeping Cost of Goods Sold at a minimum is just as vital as Marketing and Advertising. Maximum value for both customers and shareholders rely on the company’s operations being as lean as possible and its raw materials prices as low as possible. Tootsie Rolls Industries continually upgrades its plant assets to add capacity, improve quality, or increase efficiency. The company manages cost of raw materials through competitive bidding and using commodities futures

Peyton Approved was formed a little over a year ago in the kitchen of the owner of a wonderful Airedale named Peyton. Peyton has severe allergies and cannot eat dog treats from the store. Peyton Approved sells homemade dog treats that are all natural and hypoallergenic. The company’s president (also Peyton’s owner) started selling these treats out of her home to other dog owners who wanted all natural dog treats for their dogs. Due to more demand of the all natural, hypoallergenic dog treats, Peyton Approved needs more room to make the treats and reach more dog owners. Peyton approved feels moving into a storefront will reach more dog owners who want their dogs to have all natural dog treats. Financing will provide Peyton Approved the

Finished goods inventory is the finished Tootsie Roll ® candies’ inventory value after they have been created, wrapped, packaged, and are ready to be sold. The total value of inventory at Tootsie Roll on December 31, 2015 was $62.263 million.

Tootsie Roll Industries, Inc. has been engaged in the manufacture and sale of confectionery products for 113 years. Our products are primarily sold under the familiar brand names: Tootsie Roll, Tootsie Roll Pops, Caramel Apple Pops, Child’s Play, Charms, Blow Pop, Blue Razz, Cella’s chocolate covered cherries, Tootsie Dots, Tootsie Crows, Junior Mints, Junior Caramels, Charleston Chew, Sugar Daddy, Sugar Babies, Andes, Fluffy Stuff cotton candy, Dubble Bubble, Razzles, Cry Baby, Nik-L-Nip and EI Bubble.

Tootsie Roll Industries, Inc., a niche candy maker, has often been voted one of Forbes magazine’s “200 Best Small Companies of America.” A top quality producer and distributor of Tootsie Rolls and other candy, Tootsie Roll Industries maintains a 50% market share of the taffy and lollipop segment of the candy industry, and sales have increased each year for the past nineteen years. The world’s largest

This strategy of acquiring and improving upon unique brands helps the company avoid the first pitfall of utilizing a differentiation strategy as brands cannot be easily or quickly copied. However, the obsession with reputable and older, recognized brands makes this maneuvering come off as defensive. Coupled with Tootsie Roll’s lack of recent innovation both in products and marketing, as well as staying within the confectionary industry and not making attempts to experiment outside of this sector, causes the company to seem antiquated and

I have reviewed the past two years liabilities and stockholders’ equity sections of Tootsie Roll Industries, Inc. and compared the balance sheets using Debt to Equity Ratio and Times Interest Earned. The calculations presented in thousands:

The Real Estate and Equipment: CDC/504 loan program provides a loan with interest rates that do not fluctuate, typically for equipment or real estate investments. Businesses must be operated for profit, meet size standards and be an eligible type of business in order to be considered or eligible for this type of loan. The intended goal of a loan determines the amount, whether it be, job creation, small manufacturing or public policy. Maturity is 10 and 25 years. I do not understand the interest rates. Fees for this type of loan are 3% of unsecured debt, which the loan may

Doughnut Time (2016) is a Brisbane based company, specialising in a variety of premium desserts that capitalise on the use of social media, unique locations and offerings (refer to table 1). Despite desserts being considered non-essential, high levels of competition and healthy eating trends (refer to table 1), the business has successfully established itself within the fast food and dessert industry, which is set to grow in the next five years (Tonkin, 2016). The company has a distinctive vintage flair, yet modern take on doughnut names and designs, becoming popular on social media (Doughnut Time, 2016). It’s vintage vans and small ‘hole in the wall’ stores make the company sort after, and appear unique from a large number of competitors

In week three, Learning Team E presents a loan package for public held company, Tootsie Roll Industries, Inc., in business for over 100 years. Tootsie Roll is a manufacturer of confectionery products. In addition to sales in the United States, Tootsie Roll’s profits grew in Mexico, Canada, Europe, Asia, South and Central America. This loan package consists of three sections: Financial Ratios, Corporate Strategy-2008 Project: Capital Expenditure, and Loan Approval’s Effect on Tootsie Roll Industry, Inc. Financials.

Fred Flintstone has just become the product manager for Yabba Dabba Doo, a consumer packaged product with a retail price of $2.00. Retail margins on the product are 33%, while wholesalers take a 12% margin. Yabba and its direct competitors sell a total of 40 million units annually, and Yabba has 24% market share of this total. Variable manufacturing costs for Yabba are $0.09 per unit. Fixed manufacturing costs are $1,800,000. The advertising budget for Yabba is $1,000,000. The product manager’s salary and expenses total $70,000. Salespeople are paid entirely by a 10% commission. Shipping costs, breakage, insurance, and other

Measures of financial leverage remained rather consistent between Seasons 1 and 2 and reflect that the Lemonade Stand uses approximately 10% debt. The use of debt was reduced even further for Season 3 down to approximately 5%. The minimal use of debt is a potential contributor to the large decrease in the sustainable growth rate of the business. An increase of the businesses financial leverage makes additional debt financing available. This external source of financing can be used in conjunction with internal sources of financing to allow the firm to expand more rapidly.

Potz and Pans would be the most eligible company to get the loan because they have a more current asset ratio and could more easily repay the loan. They are in the average standard to get a loan because a low current ratio of 1.76 could be pointing to financial problems. However. A high ratio such as Potz and Pans of 5 , could be the result of a brighter financial picture or a warehouse with excess inventory