CR PLASTICS

Topics: Asset, Finance, Balance sheet, Investment, Financial ratio / Pages: 3 (598 words) / Published: Oct 18th, 2014
C. R. Plastics

Role: Jamie Bailey (owner of C. R. Plastics)
Decision: how much money would he need to keep up with growing demand - should they level load
Problem: C. R. Plastics need financing in order for growth of the company
 bank line of credit: $500 000
 personal money: $150 000
 credit card: $35 000
- Jamie has exhausted his means in financing and needs an injection of new money
Objective: convince the Dragons’ to provide financing without giving up more than 30% of his company

Company
Recycled plastics  assemble into chairs

KSF
- cost control
- innovated products
- managing inventory

Industry
 outdoor furniture is high fragmented and competitive
- C. R. Plastics are competing with a lot of different companies making their business risky to invest in
- other businesses have the opportunity to cut costs lower if they see the opportunity to do so, making the business riskier
 trend for North America to be a net importer of furniture due to cheaper oversea production - hard for the company to bring value to consumers based on price - difficult for the company to create bigger margins for themselves - the strong $CA impedes competitiveness with oversea companies - risky because the company will not be able to compete on price - how will investors recuperate their money
 outdoor furniture is highly seasonal
- the company has a narrow time frame to generate sales making the business riskier
 furniture business is not novel - highly likey for companies to come up with similar product
- would investors want to invest in a company that does not have patents or security in knowing they are the sole providers of such a product
 currently no national retailer interested in high-quality recycled plastic furniture
- minimal opportunity to get a deal with a large order unless a Dragon is able to have a connection
 company has inventory issues (financing cash issue – tying up cash) - where do we keep the

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