As a senior financial analyst for Fresh Juices, Inc., the largest fresh fruit drink company in the United States, you are a key player in corporate finance for the business. You are consulted on major capital projects, prepare analysis for executive officers, present material at senior management meetings, and play the overall role of advisor to executive and senior officers.
Fresh Juices, Inc. has witnessed its sales grow from US$1 million in the first year of operations in 1970 to US$1.5 billion last year. The company started as a regional supplier of fresh fruit drinks in California and initially expanded in the West. However, over the last 15 years, the company has moved further east, north, and south. Today, the company's lines of products can be found on the shelves of any major grocery store in the U.S., and its market share of fresh fruit drinks is 80% in the United States.
The Drive to Expand Internationally
On a recent trip to Canada and Latin America, Hector Vasquez, the company's chief executive officer (CEO), noted the lack of fresh fruit drinks in the supermarkets. When he returned, he brought in all of his senior officers and said, "I want to be international in a year. We have a great product, and I think we can compete effectively in North and South America, Europe, and Asia. My recent travels confirmed my suspicion that fresh fruit drinks like ours do not exist outside the U.S.," he said. "Furthermore, with the U.S. market growing at 2% annually, we need to find other markets that have the potential to grow at a faster pace."
Mr. Vasquez asked your boss, Bonita Galloway, to head up the team to do the analysis on international opportunities and report back to him in the coming weeks. With that, he dismissed the meeting, and the senior officers left.
The U.S. business was so mature and was not growing rapidly, so Ms. Galloway thought international expansion might be just what the company needed. She was concerned that the company's profit margins would start to be squeezed in the company years if the firm did not find other sources of revenue growth. This would force the company to make drastic cost cuts and could potentially impact Fresh Juices' ability to compete.
Given your role in the organization, Ms. Galloway immediately thought of you as the finance lead on this project. She called you to her office to discuss what happened at the meeting with Mr. Vasquez.
After briefing you, she said, "I want you to be the primary contact on this. I will need you to work closely with the various departments that will be involved with this effort. Specifically, I need to lean on your analytical capabilities because we need to make objective decisions. I need you to give me the facts-not what you think I want to hear. This is important to the future of the company. I know I can count on you."
Task Name: Phase 3 Discussion Board
Deliverable Length: 4-6 paragraphs
Details: Toto Matsui liked the work you did on capital structure and foreign exchange. He now wants to talk to you about what the firm can do to manage its foreign exchange risk. He asks you to compose an e-mail that outlines the options the company has for managing foreign exchange risks. Send it to him and the entire senior management team.
Write an e-mail to Mr. Matsui that describes the strategies and techniques available to Fresh Juices, Inc. to manage foreign exchange risks.© BrainMass Inc. brainmass.com October 1, 2020, 8:56 pm ad1c9bdddf
The response addresses the queries posted in 1118 words with references.
//Prior to write for this query, you should have a thorough look on the scenario given with this query. Then, you are required to define, what options are available with the Company for managing 'Foreign Exchange Risk'. I would like to guide you on these points, which will surely help to write your paper. See the text below: //
I am sending you a reply on the basis of the information that I have received. In my mail, I have given a brief introduction about the company, meaning of exchange risk, how should be the foreign exchange risk be managed and the various alternatives to manage the foreign exchange risk.
//Initially, you should give a brief introduction of Fresh Juice, Inc. In the paragraph given below, I am providing you a short description of Fresh Juices, Inc. //
Fresh Juices, Inc. Is the largest fresh fruit drink company in the United States? From the last many years, the company has moved further and covered east, north and south. There has been a growth in the sales of Fresh juices, Inc. from US$1million to US$1.5 billion. The company started as a Regional supplier in California and has expanded in the west. The products of this company are found on the shelves of any Grocery store of US. The company has a good product and can easily compete with the other companies. The company thought that the international expansion would be just what the company needs the most to grow more rapidly. Along with this, it is important to know how the Foreign exchange risk can be managed.
Foreign exchange risk is the risk that the domestic currency value of cash flows, denominated in foreign currency, may change because of the ...
990 Words, APA Format