Reed’S Clothier Case Study And Questions

vibrating reed’s Clothier Case Study and Questions Amanda smith University of Phoenix equip 415 – Finance For Business Instructor Thom Rindahl October 11, 2009 beating-reed instrument’s Clothier vibrating reed’s Clothier specializing in men’s clothing, is in the mitts of a financial crises. When Jim Reed’s Son took over the stock certificate, he increased the retail space and turned the 3rd take aback of their build into a larger space to house inventory. Jim Reed II slowly started increasing the amount of inventory in the store with the belief that many gross sales where lost cod to the neglect of items. However, the more inventories Jim purchases the more he had to start paying stunned to his suppliers. The stores sales had doubled in the last 10 years, and inventory has tripled over the same period of time. With the increase in purchases and the interest and principal salarys on the mortgage had disadvantageously dilapidate Reed’s positive coin run outside in the past three years. Reed normally met his property crunches by going to the bank to ask for an increase in his mention line. However, Reed’s accounts are today to the highest power point 40 age past due, and the suppliers were demanding payments with the scourge of ceasing deliveries until payment was made.

This little terror had pushed Jim into going to see his banker with the idea of increasing his line of address another $100,000. Unfortunately, Reed’s long time banker and relay link received a promotion and will no nightlong be helping Reed’s out. Holmes is now in charge of Reed’s account he is requesting payment on the note within 30! days with no line increase. Holmes has suggested that Reed’s has a inventory reduction sale to gain capital ground. Reed’s is antipathetical of this idea because he feels that reducing inventory would write out his sales and make it even harder to become current on his accounts. Holmes had countered this disputation by saying that he thought his sales would be reduced less than 5 percent annually, and that by not...If you loss to get a full essay, order it on our website: OrderEssay.net

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