Guillermo Furniture Store Analysis

Tootsie Roll’s simple strategy is to be (and remain) a top-quality producer and distributor of Tootsie Rolls and other candy products, in an industry where it currently has 2 to 3 percent of market share. Specifically, the company has determined to specialize, almost entirely, in hard candies (such as Tootsie Pops and Blow Pops) and chewy candies (such as Tootsie Roll, Frooties and Flavor Roll), and it currently maintains a 50 percent market share in this unique segment. The success of Tootsie Roll in the U.S. for the past 19 years is attributable to the strong consumer awareness of the company’s brand name and brand loyalty. Over time, Tootsie Roll has neither diluted the quality of its products nor failed to

Fierce competition in the confectionery industry means Tootsie Roll must innovate in order to maintain strong sales. The company does so by reinvesting in its operating assets and creating new products. In 2013, Tootsie Rolls spent $16 million upgrading plant equipment and added Cry Baby Chews, Naughty or Nice Pops, and Andes Creme de Menthe Trees to its product line. Special promotions aimed at the company’s high volume customers also boosted sales.

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 is financially strong and with this loan plans to expand its brand, and reach a larger customer base. Tootsie Roll Industries plans to create new flavors that will set the company aside from competitors and increase its market share.

Finance. In order to finance our startup year, we issued stocks and borrowed loan to finance our operation and for safety in case the sales did not go well. Financing using stocks means that we are selling common or preferred stocks to individuals. In return for the money, they get some ownership over the company and its interest. This helps to bring public’s awareness about the company. If the sales suffice, we will pay the debt in the second round.

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:

Overall Tootsie Roll has better liquidity. Liquidity measures the short-term ability to pay obligations as they are expected to be due within the next year.

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.

Increase in current liabilities Substantial increase in current liabilities weakened the company’s liquidity position. Its current liabilities were US$2,063.94 million at the end of FY2010, a 48.09% increase compared to the previous year. However, its current assets recorded a marginal increase of 25.07% - from US$1,770.02 million at the end of FY2009 to US$2,213.72 million at the end of FY2010. Following this, the company’s current ratio declined from 1.27 at the end of the FY2009 to 1.07 at the end of FY2010. A lower current ratio indicates that the company is in a weak financial position, and it may find it difficult to meet its day-to-day obligations.

According to Principles of Marketing, 2015, “A production orientation is a philosophy that focuses on the internal capabilities of the firm rather than on the desires and needs of the marketplace”. In my opinion, a company that successfully follows this method is Bob’s Discount Furniture. Bob’s Discount Furniture is known for their discounted bedroom sets, living room sets, and dining. When you see their advertisements they put emphasis on how well their product is over that of their competitors. Specifically, when it comes to their mattress, the Bobo-pedic, they designed this product to be better than the competition, Tempur-pedic at a much lower cost. I believe Bob’s is successful with this approach because they are able to focus on the

The startup plan was developed on a small budget, however; the company has managed to develop and keep expanding. If the results are conclusive and a loan application is approved this will allow the company to meet new needs as they arise. This will include the building of new locations, updated computers, cash registers, and a rewards system for the loyal guests.

Wendy Beaumont, the company’s president is looking to further expand and has asked the advice of friend and financial consultant, Amy McConville to review a potential acquisition or partnership. The prospects will elevate some of the president’s concerns for financing. In her own words, Ms. Beaumont expressed that the cost of financing growth right now was high and Friendly Card's projects 20% growth over the next year and even more in subsequent years. Further stating, the company had never been without financing problems and had always been capital intensive relying on strong relations with its banks and suppliers in realizing success. Still, Friendly’s bankers have begun to feel uneasy regarding the company’s heavy reliance on debt capital to finance operations. The bank reminded the company they agreed to provide financing in 1986 with the expectations of Friendly Cards’ sales would decrease substantially in the future. The firm's liabilities/equity ratio had peaked to 5.2 in 1986, and was still a couple of years away from returning to historically lower ratios. As a result, the bank strongly suggested the company obtain alternative financing to support its forthcoming peak production season.

The Guillermo Furniture Company has realized that their business strategy is no longer sustainable. The external environment has changed significantly and the company is facing pressure from oversees firms that have automated much of their furniture production and manufacturing. Despite the fact that Guillermo Furniture has access to relatively inexpensive Mexican labor, the company is still struggling to be competitive in the market due to foreign competition. Therefore, Guillermo has identified various alternative strategies that it wishes to consider in order to reinvent its business and become more competitive. It is recommended that Guillermo invest in new equipment that can modernize its manufacturing capabilities. An investment in a computerized lathe shows a worthwhile return on the company's investment and will also position them for future growth.