Case Study Of Agrilace Company
Risk Management
Student’s Name
Institutional Affiliation
Risk Management
Companies that have an international presence face various risks due to the dynamics of the business. Agrilace Company has over time had to deal with various challenges. The company realizes that new and vibrant firms are coming up which threatens their presence especially in America. The top competitor has for instance created better detergents that not only cleans the laundry but also protects the user from harm. Agrilace may therefore have to implement strategies towards handling the inherent risks to protect their financial status and the ability to remain in the market for the long haul. The table below illustrates the different risks that Agrilace …show more content…
To begin with, the dollar has been appreciating which translates to reduced income for the foreign investments. The company is also likely to deal with bad debts especially from retailers that take the consumer goods on debt. There is also a risk that the profits will dwindle, a factor that can be attributed to the high number of emerging competitors offering lowly priced goods. The interest rates are also likely to go high which may also affect the company if they had financed their projects with loans (Miles, 2011). The company also is at risk of inflation. The consumer products company relies on transportation to reach their customers. An increase in the price of fuel will, therefore, add to their finances and consequently reduce their …show more content…
Drastic weather changes are likely to cause destruction which will hence reflect negatively on the company’s finances (Associates, 2014). Also, if Agrilace invests in a company that later faces political instability, they may have to pull out of such a company which is not only expensive but also fruitless in the long run. A change of government may have positive or negative effects. For instance, if the new government imposes a rule that requires foreign companies to remit a higher fraction of their income to the state, it may end up facing massive
Student’s Name
Institutional Affiliation
Risk Management
Companies that have an international presence face various risks due to the dynamics of the business. Agrilace Company has over time had to deal with various challenges. The company realizes that new and vibrant firms are coming up which threatens their presence especially in America. The top competitor has for instance created better detergents that not only cleans the laundry but also protects the user from harm. Agrilace may therefore have to implement strategies towards handling the inherent risks to protect their financial status and the ability to remain in the market for the long haul. The table below illustrates the different risks that Agrilace …show more content…
To begin with, the dollar has been appreciating which translates to reduced income for the foreign investments. The company is also likely to deal with bad debts especially from retailers that take the consumer goods on debt. There is also a risk that the profits will dwindle, a factor that can be attributed to the high number of emerging competitors offering lowly priced goods. The interest rates are also likely to go high which may also affect the company if they had financed their projects with loans (Miles, 2011). The company also is at risk of inflation. The consumer products company relies on transportation to reach their customers. An increase in the price of fuel will, therefore, add to their finances and consequently reduce their …show more content…
Drastic weather changes are likely to cause destruction which will hence reflect negatively on the company’s finances (Associates, 2014). Also, if Agrilace invests in a company that later faces political instability, they may have to pull out of such a company which is not only expensive but also fruitless in the long run. A change of government may have positive or negative effects. For instance, if the new government imposes a rule that requires foreign companies to remit a higher fraction of their income to the state, it may end up facing massive