Virtual Organization Strategy Paper
Virtual Organization Strategy Paper
Companies have numerous options when determining how to meet their capital needs or when faced with a lucrative opportunity for expansion. Businesses must decide whether offering an initial public offering of stock, merging with another business, or acquiring another company presents the best option. Each method possesses its advantages, disadvantages, threats, and opportunities. In this case, the domestic purveyor of fine foods and wine, Kudler Foods, and the internationally recognized fine food and wine wholesaler, LaFleur Trading Company, face the decision as to what method of expansion suits their companies best. This paper discusses the initial public offering (IPO), merger, and acquisition methods of expansion for Kudler Foods and LaFleur Trading Company as well as the global currency risks of conducting business on an international level. Initial Public Offering (IPO): Advantages and Disadvantages First of all, the Initial Public Offering (IPO) procedure involves evaluation of business procedures, intense scrutiny by the Securities and Exchange Commission (SEC), and consideration of the advantages and disadvantages. One of the most important financial benefits lies in raising capital. Financial resources gleaned from the IPO can fund research and development, fund capital outflow, or pay off current debt. Another benefit is an increase in public awareness of the company because an Initial Public Offering generally makes products visible to a new group of possible investors. An Initial Public Offering (IPO) can also establish an exit plan for owners; venture capitalists have used Initial Public Offerings (IPO) to benefit financially from corporations they built privately. Conversely, businesses may rule out an IPO due
Companies have numerous options when determining how to meet their capital needs or when faced with a lucrative opportunity for expansion. Businesses must decide whether offering an initial public offering of stock, merging with another business, or acquiring another company presents the best option. Each method possesses its advantages, disadvantages, threats, and opportunities. In this case, the domestic purveyor of fine foods and wine, Kudler Foods, and the internationally recognized fine food and wine wholesaler, LaFleur Trading Company, face the decision as to what method of expansion suits their companies best. This paper discusses the initial public offering (IPO), merger, and acquisition methods of expansion for Kudler Foods and LaFleur Trading Company as well as the global currency risks of conducting business on an international level. Initial Public Offering (IPO): Advantages and Disadvantages First of all, the Initial Public Offering (IPO) procedure involves evaluation of business procedures, intense scrutiny by the Securities and Exchange Commission (SEC), and consideration of the advantages and disadvantages. One of the most important financial benefits lies in raising capital. Financial resources gleaned from the IPO can fund research and development, fund capital outflow, or pay off current debt. Another benefit is an increase in public awareness of the company because an Initial Public Offering generally makes products visible to a new group of possible investors. An Initial Public Offering (IPO) can also establish an exit plan for owners; venture capitalists have used Initial Public Offerings (IPO) to benefit financially from corporations they built privately. Conversely, businesses may rule out an IPO due
References: Arthur, L. (2012). Advantages & Disadvantages of an Acquisition. Retrieved from http://www.ehow.com/info_8567953_advantages-disadvantages- acquisition.html#ixzz1yknif5Vc Blanc, C. (2012). The Advantages & Disadvantages of the Acquisition of Another company-same-industry-31362.html William, P. (2008). The Advantages and Disadvantages of Mergers. Retrieved from The Advantages and Disadvantages of Going Public. (2009). Lewis & Kappes. Retrieved From Acevedo, L. (2012). The Weaknesses for a Company Going Public Through IPO. Retrieved from http://www.ehow.com/list_6329769_weaknesses-going-public-