Loewen Group Case Study

Their strategy was about customer service rather than profit or revenue. The growth was built on creating new products for the existing target market.

Massey’s competitors were International Harvester and Deere&Company. In 1976, Massey’s market share was 34%, while the other two were 27.7% and 38% respectively. International Harvester had the highest sales and it was also the most efficient in making use of its assets, with a sales/asset ratio of 1.54. Massey was in the middle, doing better than Deere&Company. With regard to financing, in 1976, Massey and International Harvester both had a less than 50% debt/total capital. While till 1980, International Harvester managed to keep the ratio around 50%, Massey had the total debt/capital ratio out of control, with more than 80% debt financing. Neither of the two competitors relied on short term debt such as STD, while Massey relied heavily on STD.

The company is the corporation’s question mark performer and has the potential of becoming a star performer given the limited competition in the market. The company has the advantage of the parent corporation’s 25-year-old positive reputation as a local family owned business known for the quality of their products.

saw that these companies were struggling and then pumped money into them to keep them going.

     As Burton is a privately owned company, it is not as competitive as other companies are, when compared to public corporations that have financial support from shareholders. Burton reinvests in its company with only its profits, yet with shareholders backing, investment could be higher. Burton expanded by its family by creating four parent companies within two years of each other. The short time committed to, and before starting, each new addition may not have allowed for enough attention to each. (www.hoovers.com, 2004)

became a publicly traded company. The biggest challenge with student loans is finding one that

Deciding on a local company was not the easiest thing since the majority of what I consider a local company are a one owner or family owned business. Consequently, most of these smaller businesses have not expanded into other markets.

Opportunities: International expansion is a real opportunity for the company. LorPel could set up branches in other counties internationally and thus increase the market for its products and benefit from opportunities in these markets. Diversification is another opportunity for LorPel. Instead of just concentrating on the wood pellet business, the company could eventually take up other projects in the timber industry. The US Market can be considered an opportunity as well. The US market would prove profitable for the sale of wood pellets, given the high demand in the country. Exporting to the US would earn the business additional profits.

Adding to their notes, they said that CRM offers customization, simplicity, and convenience for completing transactions, regardless of the channel used for interaction. Sumner (2005) share their idea. The main characteristics he distinguished

After several failed attempt of internal diversification, they realized the lack of knowledge of their management about businesses outside the automotive area. so acquisition brought them quick fix where it brought already knowledgeable people in respective areas in their payroll.

The core problem is about their management style in top level. With such a highly efficient production line plant, the company 's management is like a job-shop, the executives take charge of every small decision of almost everyone. This greatly weakens the possibility to expand, because the one or two top management are not available dealing with so many daily issues. In addition, due to the size and life-long

Each one of these lenders having debt covenants of their own with the arrangement that if one of these covenants were to be broken all of Massey Ferguson's debt becomes callable. These types of restrictions can impede company financial options during down times (as they did when Massey Ferguson attempted an equity issuance in 1978). The emphasis on short term credit lines was also a questionable choice of finance structuring. Expansionary/market penetrating strategies typically pan out by taking losses in the short term in order to realize larger gains in the long term. Along with an expansionary strategy, Massey Ferguson was also increasing spending in R&D for production of higher horsepower tractors to market in North America and for diesel engine production.

Restructure the departments based upon the needs of the new organizational structure and the company goals.

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.

4. How did Kia, which had gone bankrupt, revitalize the organization in such a short period of time?