Guajilote Cooperativo Forestal, Honduras Essay

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1. What is your impression of Guajilote as a business venture? Guajilote is a growing business but the organization of this company does not have a steady foundation due to the political structure of Honduras. Guajilote also the amount of mahogany wood was limited and was being threatened by forest fires, illegal logging, and slash and dash burn agriculture. Wood trade was even restricted internationally. Guajilote was force to take lower price for its wood due to that there was only one distributing area. Most if not all of Guajilote employees had any education beyond primary schooling, and some were even illiterate. This made it very hard for Guajilote operations because if Guajilote employees were illiterate and had no education then…show more content…
Fires were set to prepare soils for planting and helped clear the area for cultivation, but they were not being well supervised, and even burned out of control, which created bad forest fires.
People migrating: When people migrated to Olancho the cleared the forests for cultivation, cut wood for fuel and building houses. They were using all the wood that was literally the means for Guajilote survival.
CITIES Restrictions: If mahogany continued to decrease due to trade there would be a tighter restrictions on trade of mahogany or an outright ban altogether.
Finding mahogany: The organization's size and production potential is limited by the amount of mahogany it can produce in a year. Mahogany is fairly rare in a forest and Guajilote is legally restricted to downed trees. Moreover, with the difficulties of finding, processing by hand, and then moving the wood out of the forest, Guajilote was further restricted in the quantity of wood it could handle
Capital: Guajilote doesn't invest enough in capital expenditures. A very small percentage of the funds are held back for capital improvement purchases due to the operation's simple material needs. Capital expenditures for 1997 included a mule plus materials needed to maintain Guajilote's large cross-cut saws. Inadequate funding limits the growth potential of the business.

3. Does Guajilote have a competitive advantage and/or a competitive strategy? Justify your answer. Guajilote
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