External Factor Analysis of The Vermont Teddy Bear Company
Opportunities
Settlement of NY real estate litigation
The Vermont Teddy Bear Company's settlement for their closed down New York retail store is a positive step for the company. In March of 2005, the Company continued its settlement discussions with the Company and on April 27, 2005, the Company entered into final settlement of its litigation relating to a former lease for retail space in New York City. Under the terms of the settlement, the Company paid its former landlord $1.15 million when the settlement agreement was executed, including the release of a $150,000 security deposit previously held by the landlord, and the Company will pay the landlord an additional $1.2 million on or before March 15, 2006, without interest ("Vermont Teddy", 2005). While this negatively affected net income for the third quarter in 2005, it also signals an end to litigation expenses and loss of executive focus due to this issue. It
was a good move to get this over with but it lasted for almost 5.5 years and drained the company of both human and financial resources.
Going Private
Taking the Vermont Teddy Bear Company private was a bold but in the short-term positive move for the company by CEO Elisabeth Robert. Going private will allow the company to focus on execution instead of short-term strategies to pacify Wall Street. Instead of wasting valuable executive time and effort on quarterly financial calls the Vermont Teddy Bear Company is free to follow its long-term plan and execute without the Wall Street push for short term gains. The company wanted to invest in its own infrastructure expansion and improvement but as a public company this would have incurred the wrath of Wall Street. "We were hoping to get [Vermont Teddy Bear] out of the tyranny of quarterly earnings," says founder Chris Covington (Sheahan, 2005). Additionally, the Sarbanes-Oxley Act was set to put tremendous pressure on the company. From both a manpower and financial resource perspective, this Congress enacted law was going to be more than the company could bear (no pun intended). "The prospect of having to enact section 404 [regulations] was onerous on a company like ourselves," says CEO Elisabeth Robert (Sheahan,2006). The sale closed in September of 2005
Threats
800-Flowers
800-Flowers is a huge threat to the long-term health of the company. They have 120 retail outlets compare with 0 for VTB.
In 2005, the Vermont Teddy Bear Company produced a controversial bear for the Valentine holiday. The bear that was made was called “Crazy for You” and wore a straitjacket. It became an issue when the company was confronted for offending the mentally ill. After the problem became apparent to the organization, it responded by saying that it would continue selling the toy until the inventory was empty. It was put out for the public in January and was sold out by February 3. The ethical issue in this case is whether or not Vermont Teddy Bear Company handled the situation ethically correct.
b. They meet the needs of their target market by building their stores in closer proximity.
In the year of 2005, the companies eventually found a way to make it easier for the companies to combine without having any major issues or problems. Unfortunately, around the year of 20010 the merging com...
At that time before tax increased to 9.3% sales, the earnings per share were at $4.02 (PetSmart, Inc. SWOT Analysis, 2015, pp. 25). Let’s consider numbers that lead to the physical growth of the actual company. For example, they generated $615 million in operation cash flow, and used $147 million to spend on capital expenditures. This led to adding 55 net new stores and 3 new PetsHotels (pp. 25). What this means is that PetSmart Inc. has a strong amount of cash generation. They were able to return $54 million in quarterly dividends to the shareholders and they repurchased $464 million in common stock. The Board of Directors approved $535 million share repurchase program and it increased PetSmart’s Inc. quarterly dividend by 18% to 19.5 cents per quarter (pp. 25). This is good news to shareholders and to a financial manager’s client. It reinforces that any return excess free cash flow will go the
This analysis focuses on the case study of Calyx & Corolla, a mail order flower company.
I find that there acquisitions were in all respects good buys, broadening the company's overall service reach, into new technologies and what not. But their lack of integration and push to get them to buy into the EnClean ideal wasn't very good; they simply focused too much on short term gains of the current people who were running the acquired companies instead of putting in management that would do the job right. What they ended up with was lost time, and money, which would have been better spent better getting the acquired company to better fit into the service aspect that EnClean had setup. I also think they started jumping the gun on certain buys, such as the AlphaChem acquisition. Why they did not realize or at least consider that they were not a distribution company, and that AlphaChem had no clear strategy is beyond me.
Is The Tyranny Of Shareholder Value Finally Ending? N.p., n.d. Web. The Web.
Starbucks’ solvency ratios provide valuable insight into whether the company is generating sufficient cash flow to meet short-term and long-term obligations. At the end of 2014, Starbucks current assets of $4169 million and current liabilities of $3039 million produced a current ratio of 1.37. During this same period, Starbucks had quick assets of $2474 million (cash of $1708 million + short-term investments of $135 million + accounts receivable of $631 million) with current liabilities of $3039 million resulting in a quick ratio of 0.81. These ratios imply that Starbucks was reasonably liquid at the end of 2014 with $1.37 in current assets and $0.81 in quick assets for every $1 in current liabilities. In 2013, Starbucks had a current ratio of 1.02 and a quick ratio of 0.71 and the previous year the company’s current ratio was 1.90 with a quick ratio of 1.14. This data shows that Starbucks’ current ratio and quick ratio decreased considerably from 2012 to 2013 indicating a reduction in liquidity. Starbucks liabilities increased dramatically in 2013 because of an accrued
Business depends very critically upon Fed Ex. If Fed Ex had a major disruption to their delivery system, flowers would not be delivered on time, resulting in dissatisfied customers. For example, if Fed Ex employees went on strike, there would be no alternative equivalent to Fed Ex to deliver flowers to customers. UPS, although an alternative, did not deliver perishable products in the same timely fashion as Fed Ex.
The external Factor Evaluation (EFE) Matrix examines a company’s external environment to help identify its opportunities and threats. In this matrix you figure out what your companies, in our case McDonald’s, opportunities and threats, and you give them a weight and rating. The weight for each opportunity and threat can range from 0.0 (low importance) to 1.0 (high importance). The number indicates how important the factor is if a company wants to succeed in an industry. The sum of the weights from the opportunities and threats should equal 1.0. With the ratings you can give that opportunity or threat a rating of 4 to 1. 4 means superior response, 3 means above average response, 2 means average response, and 1 means poor response.
At a macro level as a result of the acquisition the combined size of Turner & Townsend Thinc was considered to be of strategic benefit to both firms. While there have been no official mass redundancies, role duplication has resulted in early retirement and resignations. However, the common problem faced after the acquisition is power struggles, excessive overhead, bureaucracy, uncontrolled layering, and decision strangulation.
In 1997, however, he came back and rescued the company from dire straits … by using the same means for which he was sacked. (p. on the abstract page )
In this business case, a shift from seasonal to level monthly production of toys will change the seasonal cycle of Toys World's working capital needs and necessitate new bank credit arrangements.
had done a good job and on the right moment to improve its business in
Company started looking outside the canals tried to use its platform for totally different product which by itself needs new organization and consolidation of new resources. Company faced a number of changes in management, all managers were trying to lead own politics which was huge expenses for the company and tendency of losing market share.