Lei Alternative Benchmarking Paper
...business environment determining appropriate financing for capital projects and business ventures plays an important role in positioning the company for growth and success. Financial managers must analyze risks and recommend a financing mix that optimizes capital structure and maximizes wealth. Bernard Lester of Lester Electronics Incorporated (LEI) is faced with determining the best financial plan as LEI prepares to merge with Shang-wa Electronics. This paper will present 10 companies who have experienced similar issues as those presented in the Lester Electronics Scenario. These companies provide benchmarks and several ideas and alternatives to assist Bernard Lester in selecting the ultimate financing plan.
Benchmarking
General Motors (Lisa Ceaser)
General Motors once lead the automotive industry, but in most recent years has been in fierce competition with companies such as Honda and Toyota. General Motors is a multinational corporation founded in 1908, and is headquartered in the United States. “GM is the world’s largest automaker and has been the global industry sales leader in each of the last 77 calendar years, although Toyota recorded higher sales figures in the first quarter of 2008,”(General Motors). Gm took a lot of financial risk to remain leading company. Just as Lester Electronics took a good risk of adding Shang -Wa to its portfolio, GM took various financial risks as well. In order to avoid bankruptcy, GM had to come up with various ways to cut cost and this is something that all organizations are looking to do. Every organization greatest cost is the company’s labor, salary and benefits. General Motors responded to this issue by looking to get the buy in of its employees, hoping to persuade a great majority to either retire early or take a buyout. GM truly had to put its negotiation skills to work, due to the fact that this plan not...
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