Finance Cases
Balancing Revenue, Volume, and Price
Abstract
Just Tents, Inc. specializes in large tents. They are manufactured in Wisconsin from fine materials manufactured in various parts of the U.S. The employees at Just Tents have worked with their vendors for many years and have been able to create a number of tent models using materials from their loyal vendors. Even though pricing pressures have been significant, the financial results from the company have been good as more people are taking their families out away from the cities for adventures and family vacations. Many families want to have a tent that meets their needs, but needs vary and most tent manufacturers are not accommodating. An online design tool has been integrated into the Just Tents website such that customers can build and order the tent that they want with the features that are interesting to them. Once they have virtually built their tent, they pay for it and it goes into production. Once the tent has been manufactured, it is sent to the purchaser’s house that submitted the order. This case discusses the financial results for Just Tents and relates the volume with the revenue and the price structure as represented on a financial scorecard. This information is used to make critical decisions in the company leading to growth strategies and operational performance.
Always On Strategy for the Big Box Store
Abstract
Shift schedules have been difficult for employees due to fatigue and sleep deprivation. When businesses want to leverage existing physical space and infrastructure for all of the hours of the day, shift schedules are discussed. If there are hours in the day where the business is closed it is difficult to fill these shifts. Financially, the use of the sunk costs during the hours when they are not used allows for incremental revenue at minimal incremental cost, outside of labor. GDI decided to take the leap to 24-hour operations. In order to accomplish this, a shift configuration would need to be chosen that would not reduce performance or increase turnover. In this case, a decision is made that would minimize the negative effects on the business.
Balancing Revenue, Volume, and Price
Abstract
Just Tents, Inc. specializes in large tents. They are manufactured in Wisconsin from fine materials manufactured in various parts of the U.S. The employees at Just Tents have worked with their vendors for many years and have been able to create several tent models using materials from their loyal vendors. Even though pricing pressures have been significant, the financial results from the company have been good as more people are taking their families out away from the cities for adventures and family vacations. Many families want to have a tent that meets their needs but needs vary, and most tent manufacturers are not accommodating. An online design tool has been integrated into the Just Tents website such that customers can build and order the tent that they want with the features that are interesting to them. Once they have virtually built their tent, they pay for it and it goes into production. Once the tent has been manufactured, it is sent to the purchaser’s house that submitted the order. This case discusses the financial results for Just Tents and relates the volume with the revenue and the price structure as represented on a financial scorecard. This information is used to make critical decisions in the company leading to growth strategies and operational performance.
Going Global with Crypto Currency and Fintech
Abstract
USBC wanted to take their technology into several key countries to expand their market, increase their profits, and help their executive team adjust to working with different cultures. In order to expand their product lines in these countries, they needed to set up locations in each of three countries. The executive management team needed to adapt their leadership styles to the cultural values of the countries that would make the expansion of USBC’s portfolio possible. The products offered also needed to fit the needs and the cultural norms of their prospective new customers. While cryptocurrencies are a bit of a novelty at the moment, USBC wanted to use their advanced portfolio and their fintech as a differentiator allowing for penetration into these somewhat mature and saturated markets. They had to be different in order to attract a clientele that could make their profits increase significantly. It was their intent to use this expansion model as a penetration strategy for other emerging economies.
Proof of Delivery Download Cycle-Time Reduction
Abstract
MediaCorp was using 125 freight agents (think brokers) including 25 direct-to-customer (DTC) carriers to move freight across the U.S. Within this vendor pool only six agents and two DTC carriers consistently transmit their proof of delivery documents (POD’s) within 12 hrs. The goal, in this case, is to reduce the time between physical delivery and POD transmission such that all POD’s are delivered within 12 hours at a contractually obligated 95% success rate. This improvement will improve the company’s ability to provide customers with POD’s in a timely manner. In this case, the agents and the DTC’s performance will be measured. The current performance during the last 12 months was that only 4.8% of the agents used and 8% of the DTC carriers used transmitted their POD’s within 12 hours. If the POD’s are transmitted within contractual SLAs (service level agreements) then the cash flow is enhanced as all involved in the supply chain can be paid faster.
Reducing The Unbilled Balance To Minimize The Need For Working Capital
Abstract
Digital Marketing, Inc. (DMI) wanted to grow quickly. They had been in ‘start-up’ mode for three years, had built a global footprint, and now it was time to scale. Deals were being made and the revenue forecast was looking promising. Cash flow was a problem that put stress on working capital as the company took on more labor for growth projects. During some month’s payroll was a challenge. George, the CFO, asked the controller. Mattie, to put together a team to investigate the issues with cash flow and make corrections such that the company could invest in its future. In the first session, several ideas came up from accounts receivable to vendor management, however, the team decided to look at unbilled revenue as a starting point for the first phase of the project, the subject of this case. Unbilled revenue is the amount of revenue that is not billed or not ready to be billed after a billing and revenue post has happened. The forecast looked promising each month, but the monthly results were always off by several hundred thousand dollars. Where was the leak? Was the company performing work that was not being billed? The reconciliation activities between forecasting amounts and invoiced amounts were the beginning of the project.
Using Super Users to Transfer Technology to Users
Abstract
Atlas is a capital company in a very competitive and regulated environment. Technology is a game-changer in this industry. The portfolio of Atlas was getting stale and they were losing market share. The time to change was now. The board decided to pursue technologies that would attract and engage customers. Client acquisition costs for one-time loans were prohibitive in light of tight margins. Leveraging initial acquisition costs by encouraging engagement with other products would keep clients contributing to profits at Atlas. These products appealed to the largest demographic market and so contributed significantly to the financial health of Atlas Capital Group.
Alternative Bioenergy for the Energy Starved
Abstract
Algoil, LLC is an energy company. They create a variety of fuels from algae. A unique process, genetically modified algae, and plant design rigor enable Algoil to be profitable while helping the energy-starved population in South America and Africa. Algoil has used a scaling methodology to minimize processing plant design risk. This has enabled Algoil to duplicate facilities in two continents with three different capacity-related sizes to choose from. At the core of the endeavor is a technology that is both biological and process-related. These technologies are exploited in a commercial context leveraging country-specific development plans and vision-based initiatives. In this case, the development of a prototype facility and portfolio of products must be scalable. The case discusses methodologies used to scale biochemical processing facilities while minimizing the associated risk.
Scalable Vertical Farms to Reduce Food Deserts
Abstract
Given the increase in population, there may be a situation in the near future where food shortages occur because of a shrinking supply of productive arable land and the increase in food demand. This case discusses a solution to the problem through the use of vertical scalable farming that significantly increases the supply of food by introducing efficiencies that are better for the environment than current agricultural methods. TrueFarm is introducing a vertical farming method that makes anyone an indoor farmer. The farm can be as big as the farmer wants it to be. The method and the economic benefits are discussed. In addition, the impact on quality of life and the environmental benefits of indoor vertical farming are discussed in the context of spatial economic theory.
Expanding through Financial and Portfolio Optimization
Abstract
Jack’s Burgers had grown significantly since its founding in the 1950s. A unique approach was taken with its international expansion in that Jack owned all of the real estate that the franchises operated on. Not only did Jack receive rent from the franchises but the company also dealt with cash flow and commodity purchasing in foreign currencies. Jack’s treasury department had to create a foreign exchange hedging policy that optimized profits. Failure in this area could easily eliminate sometimes thin profit margins. This case discusses the valuable exercise of dealing with foreign exchange risk in an international business scenario.
In-Road Charging of Commercial EVs
Abstract
he primary barrier for electric vehicle (EV) adoption is range anxiety. Solving this problem would typically mean more access to charging stations along a route. The consumer would need to stop and spend 30 to 45 minutes charging up their batteries, delaying their arrival significantly compared to filling a gas tank at a petrol station in about 5 minutes. A better solution would be to charge the EVs battery while still moving. Technology for quicker charging is becoming available. The added benefit of not having to stop along the route would give EVs a practical competitive advantage over petrol-powered cars. The uniqueness of the technologies being used for EVs allows for this. In this case, Dynamic Electric is leveraging its proprietary technology to exploit government-funded initiatives enabling a subsequent IPO launch. They also exploit a digital marketing strategy to create brand awareness to facilitate growth across European countries and beyond.
