Clarkson Lumber

Case Write-up #1 Clarkson Lumber Company Background Clarkson Lumber Company (CLC) is a prosperous finished wood products caller with a promising future, only needs to apply sound managerial financing policies to lead to be competitive in this market. The sole owner, Keith Clarkson, is dedicated to his art and has a good reputation among his suppliers and customers. CLCs sales have been consistently suppuration over the past several years, rising 19% from 1993 to 1994, 30% from 1994 to 1995, and are expected to rise 21.7% in the real year, 1996. The companys products are in demand in the growing Pacific Northwest metropolitan area where they are turn up and are somewhat protected from the effects of economic downturns in construction because the companys core competencies are associated with the repair business. The NAICS formula for CLC is 3219110-wood window and door manufacturing. This industry is comprised of over 1000 staunchs with a combined revenue of over $8 billion. In enact to remain profitable in this industry, a successful firm must rely on efficient manufacturing processes and distribution networks. The companys existing strategy relies heavily on cope deferred payment and short term debt to finance organic growth.

CLCs veritable lender, Suburban National Bank, will not lend more(prenominal) than $400,000 and the company will not be able to fancy expected sales demand without additional financing beyond this amount. Additional funds needed (AFN) is calculated to be $167,990 to butt against expected growth. Without those additional funds, CLCs growth would be limited to the self-supporting growth rate of 6.82%. To meet this challenge, Clarkson is pursuing a in the buff line of credit of $750,000 with Northrup National Bank as an alternate(a) to the existing line. Clarkson believes this new line of credit will cleanse CLCs profitability by allowing the firm to take advantage of trade credits offered by his suppliers. George Dodge, the loan officer for Northrup... If you want to write down a full essay, order it on our website: Orderessay

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