Generoso Pharmaceuticals & Chemicals Inc.

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Case 1
Generoso Pharmaceuticals & Chemicals, Inc.

Statement of the Problem

To determine the possible actions the Generoso Pharmaceuticals & Chemicals, Inc. should take in order to stay in competition and where to find additional capital.

Areas of Consideration
(SWOT ANALYSIS)

Strengths
* Liquidity of the Company
* Ready for expansion
* A wide supply for raw materials
* Conservative cash management policies

Opportunities
* A good project
* Contacts in the Us who provides supply
* A large area for expansion
Weaknesses
* Less quality of their products
* Expansions are too costly
* Lack of additional capital
* Poor management

Threats
* Stability of the economy
* Risky project because its too costly
* Fast turnover of participants in the industry
*

Alternative Courses

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of Action
1. GPC can borrow money from banks or other financial intermediaries, and they can hire Filipino chemist who is less expensive but still has the quality. Advantages:
a. It will be less risky
b. It will cost less and support our Filipino chemists
Disadvantages:
a. Its quality is at risk

2. GPC should accept the project.
Advantages:
a. It will make the company stay in competition
b. Creditors will provide the needed budget
Disadvantages:
a. It is too costly and risky

3. GPC should not accept the project and stay small
Advantages:
a. It will cost less and less risky for the company
Disadvantages:
a. It will not make us competitive
Recommendation

I therefore recommend that the best alternative action is to accept the proposal of the project for Generoso Pharmaceuticals & Chemicals, Inc. in order for them to stay in competition and reputation. Creditors will provide the needed budget, the risk of borrowing a huge amount of money can be assured that the project will provide...
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