External influences Economy Interest rates Most businesses will need

A barter system is where you take a item and another item and trade them and, sometimes you throw in cash

The primary issues in the Giberson’s Glass Studio case revolve around simple costing structure problems. Giberson does not have the correct knowledge about what each of his products is costing him, thus his ability to derive how profitable each of his product lines is severely hindered. Having no basic cost structure brings many problems to all lines of business and causes inefficient allocations of funds and removes the ability to bring about the maximum level of profits that each business desires. Under periods of financial distress Giberson without these product costs is unable to restructure his business model around his biggest “money makers” and can’t remove the products that are no longer profitable and are holding the business back.

Additionally, if down the road cash flow becomes an issue, a quick sale of the facility may not be possible.

Owens & Minor is a distributor of surgical and medical supplies to hospitals and other health care facilities. Due to changing demand from customers, the company is facing increased operating costs, which has resulted in lower profit margins and even losses. In 1993, O&M recorded an $18 million profit, which was reduced to a loss of $11 million in 1995. The entire industry is experiencing similar difficulties. In an effort to resume profitability, O&M is evaluating alternatives to “cost-plus pricing”. Cost-plus pricing does not reflect the true cost of the services provided by O&M. Customers are demanding more of O&M while

Requires additional training cost, space, business strategy and building customers recognition, hire professional help which may cause additional fund or used available line of credit

Revenue Estimates Revenue Item 100% Monthly 75% Monthly 50% Monthly Notes Rooms $2,956,500 $2,217,375 $1,478,250 8,100 daily Leases $180,000 $135,000 $90,000 TOTAL REVENUE $3,136,500 $2,352,375 $1,568,250 Expences TOTAL VARIABLE COSTS $454,000 $340,500 $227,000 TOTAL FIXED COSTS $1,403,000 $1,403,001 $1,403,002 TOTAL EXPENSE BEFORE IT $1,857,000 $1,743,501 $1,630,002 EBIT $1,279,500 $608,874 -$61,752 Depreciation $320,000 $320,001 $320,002 EBITDA $1,599,500 $928,875 $258,250 Furnishing Interest $110,000 $110,000 $110,000 20yr Mortgage Interest $182,000 $182,000 $182,000 TOTAL INTEREST $292,000 $292,000 $292,000 TAXES (40%) $395,000.00 $126,749.60 -$141,500.80

The Fed can lower banks' reserves meaning banks would be required to carry less money on their books and can loan out more to businesses and consumers along with other banks. This approach increases the money supply in the economy. The Federal Open Market Committee meets eight times per year to place key interest rates and to choose whether to increase or decrease the money supply which the Fed does by buying and selling government securities. To comprehend how the Federal Reserve's procedure on interest rates affects you and your business, you should first understand what the Fed is trying to do. The objectives of the Fed’s monetary policy are to encourage sustainable growth in the U.S. economy, support high employment, and keep prices stable.

That way, even with the company losing money there will be sufficient funds within the

Option 2 – Purchasing a Block of Business (See exhibit 6 for its revenue & cost evaluation)

Option 2: Decrease Cost of Goods Sold and Expense by 20% due to the current economic climate.

This is beyond the company cost limit set of $16 million capital and $2.6 million yearly payment for improvement. The company is committed to keep the plant but at the basis on the cost limit set.

There was another problem of setting up capital required by the company for starting the production.

decrease the own accounts receivable, but it may also cost more overhead than it at the end brings.

Because of the stiff competition in the marketplace the margins of operations are drastically low. In such scenarios implementation of costly IT solutions will make the business unprofitable.

• Heavy Administrative Cost Structure: Research shown 14% of the revenue in 2008. Again they need a group of consultant or specialist