Week 5 Kudler Fine Foods
Opportunities for each approach
Kudler Fine food is a privately held company that wants to expand their operations. Looking at the three options for expansion:
• Going public through an IPO
• Acquiring another organization in the industry
• Merging with another organization
According to "Investopedia" (2013), Initial Public offering (IPO) are often issued by smaller, younger companies seeking the capital to expand, but can also be done by large privately owned companies looking to become publicly traded. ("Investopedia", 2013). If Kudler food takes the IPO option to expand their operations this opportunity would allow them to go public. This will allow Kudler foods to gain in capital. The money can be utilized for the expansion of the industrial undertaking by establishing additional manufacturing units to produce additional. The Company has the liberty and elasticity to spend the capital which will lead to increase in company’s growth rate, solid financial base and high level of liquidity.
If Kudler foods takes the acquiring another organization in the industry option it will benefit the company by omitting one of their competitive companies in the market. It will definitely expand the share of Kudler foods in the market and will help them gain to become number one leaders in the market industry.
If Kudler foods merge with another organization, it will automatically take away their identity known as “Kudlers fine foods”. But, one of their opportunities to merge will lead to high financial liquidity which will result in expansion of the company’s profit and sales. All the existing distribution locations used by both Kudler’s and the other firm can be combined to achieve the greater result in the market. For example, if they have two locations in one state they can omit one of the locations merge everything to one, where sales continue to stay high. Close the other location and build one of their companies in another state...