Premium Essay

Starting Right Corporation Case Study

In: Business and Management

Submitted By fajahara
Words 1473
Pages 6
Starting Right Corporation Case Study

Abstract
Julia Day watched a movie about a career woman leaving her job to start a baby food company. Julia wished to start her own baby food company, so she began developing ideas about the type of product she wanted to produce, how to package it, and the resultant quality of the product. Julia also made considerations for the type of people she would like to have work for her new company. Her determination allowed her to find suitable people to help her develop a preliminary offering of her baby food. The new baby food was received well in a small-scale study. Thereafter, Julia and her team needed to raise funds. They considered three options: corporate bonds, preferred stock, and common stock. The financial characteristics of potential investors, the return rates for each option, the market, and the future inflation rate were all evaluated regarding impact on getting the company off the ground. This case study evaluation will serve to discuss the potential investment into Starting Right Corporation by others with varying perceptions of the possible success of the business. The development of legal documentation for the business and investment alternatives for parties who are risk-averse and risk-seekers will also be discussed herein.

Sue Pansky, a retired elementary school teacher, is considering investing in Starting Right. She is very conservative and is a risk avoider. What do you recommend? Since Sue is cautious about change or innovation and wants to limit her exposure to loss, I would recommend that she evaluate her options and determine the possible outcomes to any potential decision she makes about opting in to investment in Julia’s baby food company. One way this can be done is to take a comprehensive view of the details and develop a measurement tool that will show the worst and best potential…...

Similar Documents

Premium Essay

Stryker Corporation Case Study

...Stryker Corporation Case Study Stryker Corporation Case Study Andrew Wyatt Brett Nymeyer Brett Sundberg Josh Ihnen Executive Summary It is 2003 and Stryker Corporation is proposing to build a new facility that would be able to produce a key component (printed circuit boards) in-house instead of outsourcing that activity to suppliers. Currently, Stryker purchases PCBs from a small number of contract manufacturers but recently the suppliers have been underperforming in quality and delivery. The proposed plan would create a high degree of control over this product, ensure quality, and create an economy of scale in the long run. However, this plan also required the most capital outlay in both money and resources. The project would have an initial investment of a new building, capital equipment, and IT infrastructure totaling $6,287,258. However, there would also be cost savings in the long run from decreased purchases from suppliers even after the increased expense of Stryker’s manufacturing costs. To find out if this project offered an adequate return on investment we performed a Net Present Value Analysis and also calculated Internal Rate of Return and Payback Period for years 2003 through 2009. Analysis 1. Does this project make sense? We like the insourcing proposal and think that it makes business sense for several reasons. However, these reasons are based off of the information taken from the case before we analyzed NPV, IRR, or......

Words: 315 - Pages: 2

Premium Essay

Splash Corporation Case Study

...Rajinda Jayasinghe A0090911 SPLASH CORPORATION: COMPETING WITH THE BIG BRANDS “We are at war with the multinational corporations, fighting for the hearts and minds of the Filipino consumers” With these simple words, Roland Hortaleza, Chairman and CEO of Splash Holdings, provides some key insights into how he views his company’s place in the highly competitive cosmetics and toiletries market in the Philippines. An underdog success story in the truest sense of the word, the rise of the Hortaleza family from their humble beginnings as civil servants, to the pioneers of the “next Unilever”, the story of Splash Corporation is an informative model for those who wish to study the marketing strategies that drive successful startups in competitive markets. Several years removed from its creation, Splash finds itself facing challenges that are quite different from those that it faced at the time of its inception. In many ways, the underdog mentality that so successfully fuelled Hortaleza’s initial strategies is now obsolete. Splash finds itself in something of an inconvenient middle-ground, competing for market share against emerging low-cost alternatives and fighting the big-budget multinationals that continue to dwarf the scope of Splash’s product lines and thee depth of its marketing budgets. The following case analysis looks at Splash’s current position in the Philippines cosmetics and toiletries industry, and attempts to draw conclusions on future opportunities and......

Words: 5093 - Pages: 21

Premium Essay

Abc Corporation Case Study

...The CEO of ABC Corporation hires you to advise on how ABC will be placed in the best position to maximise its performance and to maintain long-term competitive edge. Read the following facts, and give her comprehensive advice. CASE STUDY : ABC Corporation The CEO of ABC is clearly a highly motivated individual who has worked hard to build her business and values hard work from those in the organisation. She takes pride in “leading by example” by working long hours and still getting involved on the technical side of the business, making sure that they “get the job done right the first time”. She clearly values productivity and profit. She maintains that she would not have built the business if she had not pushed herself and those around her to achieve progressively greater levels of these. Profits are still looking good, but some comments on the part of two of her fourteen senior staff members have led her to suspect that all is not well within the organisation, and that it is hence perhaps nevertheless underperforming. Recently, she received a letter from a leaving employee in their Operations division. This letter finally convinced her that she should approach you (an expert in project and programme management) for advice. Part of it reads as follows: “My experience is only from being part of Operations, but I assume that the situation is not unknown in the rest of the company. I believe that there is a major problem with the style of management in ABC......

Words: 857 - Pages: 4

Premium Essay

Starting Right Corporation

...Starting Right Corporation Jemichael Manora December 10, 2013 Columbia Southern University Summary The case study Starting Right Corporation chronicle Julia Day’s decision to create her own company (Render, Stair, and Hanna, 2012). Shortly after watching a movie, she made the decision to resign from her job to start a company, whose specialty would be premium baby food (Render, Stair, & Hanna, 2012). Seeing a gap in the current market of products, she developed a plan to advertise and a focus on high end products (Render, Stair, & Hanna, 2012). Instead of putting her product in jars and bottles, she targeted enhanced nutrition by freezing the baby food (Render, Stair, & Hanna, 2012). However, Julie understood that that her plan and company startup would not be easy (Render, Stair, & Hanna, 2012). She sought out partners who had specialties in business, marketing, production, and finance to assist her as subject matter experts (Render, Stair, & Hanna, 2012). Also, Julie knew that startup money was essential for her company to be immediate success (Render, Stair, & Hanna, 2012). She presented three options to raise initial revenue being corporate bonds, preferred stock, and common stock (Render, Stair, & Hanna, 2012). She wanted $30,000 blocks for each investment (Render, Stair, & Hanna, 2012). Also, selected investors had to have minimum income of $40,000 with a $100,000 in net worth (Render, Stair, & Hanna, 2012). The corporate......

Words: 1273 - Pages: 6

Free Essay

Fedex Corporation Case Study

...FedEx Corporation Case Study Jama Eddleman Mid-Continent University HRM 6003 Professor: Dr. J. Gordon July 14, 2013 FedEx Corporation Case Study Mixing up the order my papers usually proceed in, I am putting my Biblical worldview first, instead of at the end. There are many organizations and companies today that do not operate as God instructs. The Lord is clear in explaining how to operate a business and how to be a good employee. His instructions for the business world, as with all Christian instruction for our whole lives, is found in the Bible. B – basic; I –information; B – before; L – leaving; E – earth. I found this anagram years ago on a church bulletin board. The scripture I like in regard to this case study and how FedEx tries to honor its employees and remain dedicated to their needs comes from Micah. Verse 6:8 says, “He has showed you, O man, what is good. And what does the Lord require of you? To act justly and love mercy and to walk humbly with your God” (NI V). FedEx appears to be a company that works hard to be just, merciful, and walk humbly. FedEx leaders know that the company would not be where it is today without good employees, and they strive to do all they can to take care of their employees. FedEx is a brand name known both nationally and worldwide. FedEx began under the name Federal Express. The firm initially specialized in overnight package delivery via air cargo. While the name, size, and services the company offers have......

Words: 1152 - Pages: 5

Premium Essay

Cup Corporation Case Study

...INTRODUCTION: CASE BACKGROUND & ISSUES CUP Corporation was one of the largest insurance firms based in Europe. It had a worldwide operation and was recently acquired by another major insurance company. The firm had made a series of acquisitions to broaden the types of insurance offerings and expanding the market needs. It sold a various forms of insurance in the health, life, casualty, property and automotive areas. Customer segments of the firm’s services are divided into two groups of agents and brokers as well as end-customers. Over the last couple of years, the growth of premium income in German industry is somewhat instable. The declining growth rates had affected German insurance industry due to some reinforcing trends: 1) Worse economic climate such as increasing economic downsizing, increasing unemployment and fluctuations in real income. 2) Higher taxes and social welfare levies. 3) Increasing competition resulting from the deregulation of the European market. 4) Extensive satisfaction of the demand for insurance in German. CUP Corporation had enjoyed remarkable growth despite economic downturns. However, the increasing competition and increasing client price sensitivity in the private insurance market has led to the shorter contracts and more cancellation of existing contracts among customers that is varied by the intensity of the products. Particularly, CUP Corporation is facing some problems regarding to the customer loyalty as...

Words: 2989 - Pages: 12

Premium Essay

Starting Right Corporation

...Starting Right Corporation Case Solution Following assumptions regarding the case: • Although there are only three investment options (corporate bonds, preferred stock, and common stock), there is actually a fourth option: to not invest at all. • There are only two states of nature, either the market is favorable or unfavorable. • The minimum initial investment for any investment type is $30,000. When studying the options, we will use $30,000 as the principal amount. • To invest in Starting Right, each investor is required to have an annual income of at least $40,000 and a net worth of $100,000. • Compounding of interest will not be factored into the analysis. • Figures are evaluated on an annual basis, instead of on a five-year basis. Using QM for Windows results in the payoff table below. The values entered into the payoff table represent the profits or losses that are expected to be obtained. For example, if someone were to invest $30,000 in preferred stock, either he may gain a maximum of 90,000 or he may lose $15,000. |Data |States of Nature | |Results | | | | |Favorable |Unfavorable |EMV | Row Min | Row Max | Hurwicz | |Probabilities |0.5 |0.5 | | | | | |Corporate Bond ......

Words: 1089 - Pages: 5

Premium Essay

Case Studies Starting Right

...Case Studies 1. SOLUTION TO STARTING RIGHT CASE, CH. 3, PAGE 110 This is a decision-making-under-uncertainty case. There are two events: a favorable market (event 1) and an unfavorable market (event 2). There are four alternatives, which include do nothing (alternative 1), invest in corporate bonds (alternative 2), invest in preferred stock (alternative 3), and invest in common stock (alternative 4). The decision table is presented. Note that for alternative 2, the return in a good market is $30,000 (1 + 0.13)5 = $55,273. The return in a good market is $120,000, (4 x $30,000) for alternative 3, and $240,000, (8 x $30,000) for alternative 4. Payoff table Laplace Event 1 Alternativ e1 Alternativ e2 Alternativ e3 Alternativ e4 0 55,273 Event 2 0 – 10,00 0 – 15,00 0 – 30,00 0 Average Value 0.0 22,636.5 Minimu m 0 – 10,000 – 15,000 – 30,000 Maximu m 0 55,273 Hurwicz Value 0.00 – 2,819.9 7 –150.00 120,00 0 240,00 0 52,500.0 120,000 105,000. 0 240,000 –300.00 Regret table Maximum Alternative Alternative 1 Alternative 2 Alternative 3 Alternative 4 Event 1 240,000 184,727 120,000 0 Event 2 0 10,000 15,000 30,000 Regret 240,000 184,727 120,000 30,000 a. Sue Pansky is a risk avoider and should use the maximin decision approach. She should do nothing and not make an investment in Starting Right. b. Ray Cahn should use a coefficient of realism of 0.11. The best decision is to do nothing. c. Lila Battle should eliminate alternative 1 of doing nothing and apply the......

Words: 4522 - Pages: 19

Premium Essay

Hyten Corporation Case Study

...Read the Case Study titled "Hyten Corporation" that begins on page 38 (in Part 2) in the Kerzner text. There is some reluctance within the firm to adopt formal project management processes. Suppose that you were hired as a consultant to help the management at Hyten to accept this change. Write a short report (2–3 pages, 500–800 words) that encapsulates answers to the following questions at the end of the case study: 1–7, 10–11, and 14. 1. What are some of the major problems facing the management of Hyten in accepting formalized project management? (Include attitude problems/personality problems.) Management at Hyten has several problems in accepting formalized project management. It has to forgo must of what could keep them back like a better coordination and communication among the concerned departments taking part of the project. Some more of the major problems at Hyten are the limited authority and responsibility of the business development department, the department also has difficulty proceed with a project according to the original plan and that causes changes to take place and readjust to the new changes. Problems like this create delay and cost add ups, resistance to changes from the engineering department, MIS department are already working behind schedule and with even a creation of new staff to be dedicated to the formal project management the MIS director will need time to design programs to draw data from all the functional areas. 2. Do any of...

Words: 897 - Pages: 4

Premium Essay

Splash Corporation Case Study

...when I'm asleep 'Cause everything is never as it seems When I fall asleep I'd like to make myself believe That planet Earth turns slowly It's hard to say that I'd rather stay Awake when I'm asleep 'Cause everything is never as it seems When I fall asleep I'd like to make myself believe That planet earth turns slowly It's hard to say that I'd rather stay Awake when I'm asleep Because my dreams are bursting at the seams *SAY SOMETHING Say something, I'm giving up on you. I'll be the one, if you want me to. Anywhere, I would've followed you. Say something, I'm giving up on you. And I am feeling so small. It was over my head I know nothing at all. And I will stumble and fall. I'm still learning to love Just starting to crawl. (CHORUS) And I will swallow my pride. You're the one that I love And I'm saying goodbye. Say something, I'm giving up on you. And I'm sorry that I couldn't get to you. And anywhere, I would have followed you. Oh-oh-oh-oh say something, I'm giving up on you. Say something, I'm giving up on you. Say something... *SAFE AND SOUND I remember tears streaming down your face When I said, I'll never let you go When all those shadows almost killed your light I remember you said, don't leave me here alone But all that's dead and gone has passed tonight Just close your eyes The sun is going down You'll be alright No one can hurt you now Come morning light You and I'll be safe and sound Don't you dare look......

Words: 5773 - Pages: 24

Premium Essay

Case Study: the Crossby Corporation

...Case Study: “Crosby Manufacturing Corporation”, PMCS * Write a brief synopsis This case study deals with the Crosby Manufacturing Corporation. The president (Wilfred Livingston) of the company realized that they were losing their competitive edge due to their out-dated management cost and control system. When Wilfred became president he had two major phases he wanted to implement; 1) Employee reorganization 2) an improved MCCS policy. To initiate the latter phase, Wilfred called a meeting with department managers from project management, cost accounting, MIS, data processing, and planning. He expressed how the current system was not sufficient and capable of supporting the company. The managers weighed in with appropriate lists, preliminary schedules, suggestions and opinions that were valid. Wilfred also added that he was going to appoint Tim Emary as project manager due to his wealth of knowledge pertaining to planning. * Did Livingston make any mistakes initially? How do you think the functional employees feel? Are there other alternatives? I do not think Livingston made any mistakes initially? When he became president one of the company’s goals was to obtain large government contracts. Wilfred knew that government agencies preferred companies with customer focal point policy and that the matrix structure provided that policy. I believe the functional employees didn’t like the restructuring that occurred when Wilfred became president. The average person does......

Words: 308 - Pages: 2

Premium Essay

Case Study: Starting Right

...Starting Right MGMT524 Management Science – Group Case Study 1 Table of Contents 1 Problem Definition 2 2 Determination of Possible Alternatives 2 3 Identification of Possible Outcomes & State of Nature 2 4 Calculation of Payoff 2 5 Decisions 3 Works Cited 5 1 Problem Definition The case study “Starting Right” deals with a decision making under uncertainty scenario. This specific type can be identified due to fact that the several possible outcomes for each alternative are known. However, the decision makers do not know the probabilities of the various outcomes (Render, M.Stair Jr., Hanna E., & Hale S., 2015, p. 85). 2 Determination of Possible Alternatives The interested parties have four alternatives in the investment scenario regarding Julia Day’s business plans which are as follows: * Alternative 1: Invest in corporate bonds * Alternative2: Invest in preferred stock * Alternative 3: Invest in common stock * Alternative 4: Do not invest in any of the three previously mentioned alternatives 3 Identification of Possible Outcomes & State of Nature Based on the alternatives presented in chapter 2, the following outcomes can be defined: * Alternative 1: Invest in corporate bonds and get at least $20,000 back at the end of five years. * Alternative 2: Invest in preferred stock and see an increase of the investment by factor 5 or 50% decrease depending on the state of nature (good vs. unfavorable). ...

Words: 682 - Pages: 3

Premium Essay

Stryker Corporation Case Study

...Stryker Corporation Case Study Andrew Wyatt Brett Nymeyer Brett Sundberg Josh Ihnen Executive Summary It is 2003 and Stryker Corporation is proposing to build a new facility that would be able to produce a key component (printed circuit boards) in-house instead of outsourcing that activity to suppliers. Currently, Stryker purchases PCBs from a small number of contract manufacturers but recently the suppliers have been underperforming in quality and delivery. The proposed plan would create a high degree of control over this product, ensure quality, and create an economy of scale in the long run. However, this plan also required the most capital outlay in both money and resources. The project would have an initial investment of a new building, capital equipment, and IT infrastructure totaling $6,287,258. However, there would also be cost savings in the long run from decreased purchases from suppliers even after the increased expense of Stryker’s manufacturing costs. To find out if this project offered an adequate return on investment we performed a Net Present Value Analysis and also calculated Internal Rate of Return and Payback Period for years 2003 through 2009. Analysis 1. Does this project make sense? We like the insourcing proposal and think that it makes business sense for several reasons. However, these reasons are based off of the information taken from the case before we analyzed NPV, IRR, or Payback Period, so they......

Words: 1255 - Pages: 6

Premium Essay

Case Study : Norman Corporation

...CASE STUDY: NORMAN CORPORATION Case 8-1: Question 1 1. Female employees sued the company for $250,000.  Large number of similar suits had been filed in other companies but results are varied. Norman outside counsel thought the company probably would win the suit but pointed out that decisions thus were divided and it was difficult to forecast the outcome.  No provision had been made in financial statements. Answer: The transaction should be recognized based on the following points: i. ii. Conservatism concept stated that expenses should be recognized as soon as they are reasonably possible to occur. According to loss contingency, a liability is recognized when information available indicates that it is probable for a liability to occur and when the amount of loss can be reasonably estimated. Therefore, Norman should provide a provision for loss and recorded the transaction as a liability and an expense. The journal entries would be as follow: Dr. Cr. Lawsuit Loss Lawsuit Liability $250,000 $250,000 Lawsuit Loss will be recorded in Income Statement under Non-operating Expenses while Lawsuit Liability will be recorded in Balance Sheet under Current Liabilities (as the trial will be held on 2011). 2. Second lawsuit: Customer was injured by one of the company’s products.     Customer asked for $500,000 damage. After discussion with customer’s attorney, Norman’s attorney believed that the suit could be settled for $50,000 (no guarantee). If the suit went to...

Words: 1345 - Pages: 6

Premium Essay

Enron Corporation Case Study

...Enron Corporation case study • The Enron debacle created what one public official reported was a "crisis of confidence" on the part of the public in the accounting profession. Lists the parties who you believe are most responsible for the crisis. Briefly justify each of your choices. The debacle of Enron, a US firm is looked upon as the worst debacle and fall out in the history of US bankruptcy filed cases. There are many parties involved when it concern to Enron debacle, which was accorded to accounting instability and the compromising factor of accounting profession itself. Out of the many parties in the league and the major force behind the debacle of Enron concern Andersen's, the accounting and auditing firm that once deserved name in the industry for its conscience in accounting professional services and auditing. As the case relates to, accounting audit for Enron is attended by Andersen's since long enough. However, the interesting feature is that some compromise in the profession of accounting services by Andersen's was notable, given that there are noteworthy feature of stock manipulation, especially in financial statements of Enron attended and audited by Andersen's. The statement and restatement of Enron also gives some probable indication for manipulation of accounting, where debate and counter debate in that regard from the prying eye of the media was a common feature. Thus, the involvement of Andersen's in Enron consultancy and professional auditing makes it...

Words: 2622 - Pages: 11