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
* Liquidity of the Company
* Ready for expansion
* A wide supply for raw materials
* Conservative cash management policies
* A good project
* Contacts in the Us who provides supply
* A large area for expansion
* Less quality of their products
* Expansions are too costly
* Lack of additional capital
* Poor management
* Stability of the economy
* Risky project because its too costly
* Fast turnover of participants in the industry
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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
a. Its quality is at risk
2. GPC should accept the project.
a. It will make the company stay in competition
b. Creditors will provide the needed budget
a. It is too costly and risky
3. GPC should not accept the project and stay small
a. It will cost less and less risky for the company
a. It will not make us competitive
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...