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Report on Management Techniques : Garden Lite Ltd

   

Added on  2020-06-05

11 Pages2774 Words54 Views
REPORT

Table of ContentsPART 1............................................................................................................................................1Executive Summary.........................................................................................................................11. Explantation:...........................................................................................................................12. Application:.............................................................................................................................33. Analysis:..................................................................................................................................3TASK 2............................................................................................................................................4Executive summary..........................................................................................................................41. Explain:...................................................................................................................................42. Application..............................................................................................................................63. Analysis...................................................................................................................................8REFERENCES................................................................................................................................9

PART 1Executive SummaryIn any firm, there is a need to apply proper management techniques so that the businesscan be done in an effective manner. By using MA techniques, company can effectively utilisetheir available resources in an effective manner so that the business could attain its pre-settargets (Storey and Greene, 2010). Under this report, the Garden Lite Ltd faces mismanagementof production of goods. As, this is done due to dispute between GRL and Brico France. Hence,there is a need to make sound business strategy by the management of GRL so that the businesscan gain the competitive advantages over the others.1. Explantation:A). Profit and cash flow management:For running any organisation, management of the Garden Rite Ltd needs to manage cashflows so that the optimum income can be generated. By considering so many financialmanagement approaches, firm can enhance their profits. But there is a inward relationshipbetween risk and return. Which means that the company earns more profits than the risk is alsogetting high. But if the company think about the profits maximisation, then there the companycan not run in the long run and it ignores all the other factors like- social and others. Henceforth,company needs to think about the wealth maximisation so that it could consider all other factorsabout the community and acts accordingly. Profits: This is the outcome which emerge after having operations for a particular timeand this may vary as per the operation. In simple word, this is the fruitful outcome which emergeafter running the business (Berger and Black, 2011). This can be distributed among the firm'sowners on proportionate basis.Cash flow management: This is the management of the cash outflows and inflowswithin the firm. There are so many tools by which firm can control cash flows. As this is themost crucial component in the business. If this can not manage effectively then the business cangoes bankrupt. To get the effective cash flow, there is a need to work hard and effectivelyanalyse cash inflows and outflows.Difference between cash flow and profits:1

Profits is different from the cash flow. A positive cash flow is the main thing in order to produceprofits. If firms have enough cash then it can satiate their company related needs in a bettermanner. There is a need to sales of those goods or product which generates profit. But if the firmdoes not have sufficient money then the company can not produce goods and subsequently cannot generate profits (Columba, Gambacorta and Mistrulli, 2010). Hence, this can be said that theproper cash flow management and the profits plays a positive role.Under the provided situation, this is observed that the GRL is suffering form cash shortage andthat is the reason, the company's owner urges to their stakeholders to invest more money into thefirm in order to overcome such crunches. By implementing these kind of practices, firm canmake various particular strategy in order to avoid these kind of problems.b) Working capital: This is the money or amount available to the company to carry out its routine operationalactivities. This is the most easiest way to find out firm's liquidity, efficiency, and entire health.As, this covers cash, stock, debtors, creditors , short term debts. Firm's working capitaldemonstrates the outcomes of host of firm covering inventory management, debt managementand cost to suppliers. A positive working capital normally indicates which a firm can pay off its various shortterm liabilities. While on the other hand, an adverse working capital normally shows that itsinefficiency to pay debts. That is the reason, analysts are sensitive to lower the working capital. C). Change in the working capital:Working capital is the difference between current assets and current liabilities. For a firmwhich is running efficiently, they manage it effectively. Managing working capital is the dailyoccurrence this could simply handle. The influence on the firm about the changing in theworking capital reflects in the company's cash flow statements. More probably, operating cashflow part details change in the less time working capital needs. An increment in working capitalraise the cash to be tied up under running. Because, increment in the current assets is known asthe net outflow. On the other hand, limiting of working capital means to higher cash availablethat are required to be implemented for other projects because of increment in the currentliabilities is a net flow. Hence, there is a need to know or assessed about the reasons so that thecompany could form policies.2

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