Week 5 Kudler Foods

Topics: Finance, Attraction Pages: 1 (309 words) Published: March 2, 2013
The strengths of Kudler Foods merging with another organization would be growth as a company, diversification, availability to enter many new markets, and hopefully eliminate any competition. With the combination of these benefits from merging with another company Kudler Foods would then see a reduce in the cost of capital, an increase in supply which would then drive down prices and a much more sharpened business focus. With these strengths come a few weaknesses to a merger. A merger would definitely require a restructuring of the company. Job security and keeping employees happy is important to consider. Management is something that is looked at in all areas and may even be eliminated in some. If either company was to have debts, they would now be shared by each. This would definitely cause some financial pressure during the merger but also something that may be expected. The opportunities with a merger would allow Kudler to sell new stock to the public. This in return would present a new opportunity for investors. Investors can help expand Kudler Foods in new markets and attract new clients. Also, the simple fact that Kudler foods would be creating a new company and new idea would give a new face to the company attracting new people enabling diversity. This would allow for an increase in sales. The threat to an approach like this is people. The people, most importantly the employees, could be the biggest threat to a merger. The differences in culture of the two merging companies could cause a problem. Teamwork and cohesiveness affect the positive outcome and morale on many within an organization. The threat of the merger failing or becoming a success relies on management and employees being on the same page after the merger. Management plays a key role in success and must eliminate uncertainty and clashing of employees.
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