Corporate Management- Lawrence Sports

Corporate Financial Management Lawrence Sports is faced with the problem of receiving woebeg sound compensations from their major(ip) customer, mayonnaise. As a result, accounts payable to Murray and Gartner, the two major suppliers for Lawrence Sports, argon delayed. The delayed stip odditys are causing Lawrence Sports to sacrifice its authoritative payment obligations with some(prenominal) suppliers. The current policy with Murray implies that Lawrence Sports is to pay 15% on purchases and the stay 85% callable the following week. The brass with Gartner implies that Lawrence Sport pay 40% on purchases with the remaining relief of 60% due in the following week. Ann Wu, Head of trafficker Relationships for Lawrence Sports, considers Murray more flexible with payments than Gartner because Lawrence is its major customer who contributes 75% of sales to the company (University of phoenix simulation, 2009). Ann has a good relation with both customers Gartner an d Murray and believes that Lawrence should renegotiate the semipermanent credit rating terms with these two customers. Ann wants to confine more vendors for Lawrence Sports recognizes the compulsion to negotiate with Murray a new payment arrangement in order to alleviate future date and sustain a long-term relationship. Recommendations for Working Capital Upon implementation of a stricter consumer credit policy with current and future customers and increasing the tokenish end of month eternal rest from $50,000 to $100,000 in its accounts, Lawrence Sports should negotiate with Murray to append the amount paid on purchases to 20% and the remaining fit of 80% due in two weeks instead of unmatchable week. This option would allow Lawrence more time to receive payments from mayonnaise and help to balance the cost and cash requirements. The terms with Gartner disentangle sum remain the same, however; Lawrence should consider purchasing timberland on the job(p) product s from other manufacturing companies. In a! ddition, Lawrence should seek new outlets to scram in cash and reduce short-term...If you want to get a rich essay, order it on our website: BestEssayCheap.com

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