CaseAssignmentonBBCPvtLtd..edited12.docx

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1.      What is the prime objective of BBC at this time?

The BBC private limited is recognized as a material manufacturing organization first established in 2004. In this context, BBC as a company has its headquarter in Lucknow and its application which is located in Bangalore.. this company needs to assist in ensuring it protects the agreement with Indian Railways (IR). However, the strategy adopted to use was an adoption strategy. There was a high chance of unqualified faded powder that was going to be produced. Another thing is that the company used credit cards to sell its items. Most purchasers are usually government purchasers, and the minority are private entities.
The company had a tendency when the working capital is inefficient they will take care of the loan boss as soon as possible, but the issue here is that they won’t check at the accounts receivable. This led to their recyclables resources being frozen as inventory and account receivable.

1.      Was BBC’s working capital policy successful why or why no?

Just like I indicated earlier, I pointed out that BBC working capital was unsuccessful. There are different reasons as to why the working capital was widely unsuccessful. The first is that the organization maintained a currency and credit breakthrough point of 2.5 million rupees with the Union Bank of India. They dependent on asking the asset to redesign the structure of the IR contract, but this was not ready because it had previously reached the credit limit.
The company’s second mistake is modestly handling the working capital. This is without considering it over time. It had further resources that are far greater than the liabilities that hinder its recoverability.
 
BBC was also paid the bank too quickly, before the entire credit period. However, this hurts the mobility of the entire organization. It has realized that there is a new commitment from Indian Railways, which requires establishing a field office, a workshop, and a distribution center, for that matter. There was an increase in authoritative expenditures, including the one-time cost of the on-site IRR office, which approximately 200,000 INR.
In many instances, the BBC hopes to maintain different sufficient currency reserves with each payment and continues its typical issuance, which is activities without any form of interference.
This resulted in Agarwal realizing that the BBC was restricted in providing free credit to consumers and was shorter than the business requirements in the overall repayment of debt.

2. The BBC’s inventory turnover ratio (ITR) decreases from 2009-2011. Calculate the ITR and analyze the company’s inventory management efficiency.

PARTICULARS

2011

2010

2009

Inventories

870,146.20

740,749

322,848

Packing Materials

432,071

166,573

149,924

Finished Goods

352,160

486,200

167,300

 Sales

9,544,409

8,529,838

12,539,108

Inventory Turnover

10.97

11.52

38.84

 
From this analysis, I can say that the ITR is likely to fall from 38.84 in 2009 to about 10.97 in the year 2011. This analysis creates a situation of poor inventory management, and this makes BBC missed signs of liquidity.
From an economic point of view, a low ITR has a high likelihood of hindering the company’s subsidies, resulting in low profitability of the company or even sometimes no profits.
The industry in which BBC is one is very volatile there is special consideration which is gradually needed with and follows up, therefore—as a result, increasing the costs.

3.      Evaluate the company’s cash positions, focusing on its credit policy towards receivables and payables.

In this case, the money position of BBC was bad  because of the accompanying reasons:
First things first, there was a shortage of funds because it usually pays fees for the lessor prematurely. This action normally takes the credit a long time and may lead to the entire blockage of funds.
In this position that the organization has put itself in. the organization here reserves up to 2.5 million rupees in a monetary credit to the Union Bank of India. N this particular scenario, there is a reservation that has to be considered in inventory or receivables. From this perspective, I can say that the management of the inventor is poor.
In this particular situation, Agarwal understands that the BBC is still skeptical about providing shorter business requirements to a very large extent.
The Cos mobility will be affected because the bank’s credit method is very flexible in taking care of tenants.
The company is not growing due to a shortage of cash, and it has a higher possibility of shrinking rapidly and declining transactions.
There is a principle where the organization expects to focus on future development. Shortening the credit period granted to end customers ensures the loans are taken care of before the period of development has reached. I expect the organization to carry out effective inventory management and eventually adopt a just-in-time system and other additional systems like final quantity.

4.      What is the prime objective of BBC at this time?

The BBC private limited is recognized as a material manufacturing organization first established in 2004. In this context, BBC as a company has its headquarter in Lucknow and its application which is located in Bangalore.. this company needs assets to ensure it protects the agreement with Indian Railways (IR). However, the strategy adopted to use was an adoption strategy. There was a high chance of unqualified faded powder that was going to be produced. Another thing is that the company used credit cards to sell its items. Most purchasers are usually government purchasers, and the minority are private entities.
The company had a tendency when the working capital is inefficient they will take care of the loan boss as soon as possible, but the issue here is that they won’t check at the accounts receivable. This led to their recyclables resources being frozen as inventory and account receivables.

1.      Was BBC’s working capital policy successful why or why no?

Just like I indicated earlier, I pointed out that BBC working capital was unsuccessful. There are different reasons as to why the working capital was widely unsuccessful. The first is that the organization used to maintain a currency and credit breakthrough point of 2.5 million rupees with the Union Bank of India. They dependent on asking the asset to redesign the structure of the IR contract, but this was not ready because it had previously reached the credit limit.
The company’s second mistake is modestly handling the working capital. This is without considering it over time. It had further resources that are far greater than the liabilities that hinder its recoverability.
 
BBC was also paid the bank too quickly, before the entire credit period. However, this hurts the mobility of the entire organization. It has come to a realization that there is a new commitment from Indian Railways, which requires establishing a field office, a workshop, and a distribution center, for that matter. There was an increase in authoritative expenditures, including the one-time cost of the on-site IRR office, which approximately 200,000 INR.
In many instances, the BBC hopes to maintain different sufficient currency reserves with each payment and continue its typical issuance, which is activities without interference.
This resulted in Agarwal realizing that the BBC was restricted in providing free credit to consumers and was shorter than the business requirements in the overall repayment of debt.

2. The BBC’s inventory turnover ratio (ITR) decreases from 2009-2011. Calculate the ITR and analyze the company’s inventory management efficiency.

PARTICULARS

2011

2010

2009

Inventories

870,146.20

740,749

322,848

Packing Materials

432,071

166,573

149,924

Finished Goods

352,160

486,200

167,300

 Sales

9,544,409

8,529,838

12,539,108

Inventory Turnover

10.97

11.52

38.84

 
From this analysis, I can say that the ITR is likely to fall from 38.84 in 2009 to about 10.97 in the year 2011. This analysis creates the situation of poor inventory management, and this makes BBC missed signs of liquidity.
From an economic point of view, a low ITR has a high likelihood of hindering the company’s subsidies, resulting in low profitability of the company or even sometimes no profits.
The industry in which BBC is one is very volatile there is special consideration which is gradually needed with and follows up, therefore—as a result, increasing the costs.

3.      Evaluate the company’s cash positions, focusing on its credit policy towards receivables and payables.

In this case, the money position of BBC was bad  because of the accompanying reasons:
First things first, there was a shortage of funds because it usually pays fees for the lessor prematurely. This action normally takes the credit a long time and may lead to the entire blockage of funds.
In this position that the organization has put itself in. the organization here reserves up to 2.5 million rupees in a monetary credit to the Union Bank of India. N this particular scenario, there is a reservation that has to be considered in inventory or receivables. From this perspective, I can say that the management of the inventor is poor.
In this particular situation, Agarwal understands that the BBC is still skeptical about providing shorter business requirements to a very large extent.
The Cos mobility will be affected because the bank’s credit method is very flexible in taking care of tenants.
The company is not growing due to a shortage of cash, and it has a higher possibility of shrinking rapidly and declining transactions.
There is a principle where the organization expects to focus on future development. There is shortening the credit period granted to end customers hence ensuring the loans are taken care of before the period of development has reached. What I expect from the organization is to carry out effective inventory management and eventually adopt a just-in-time system and other additional systems like final quantity.

Is BBS a growing company: Which areas should be improved in the company for future growth?

Due to a shortage of cash, it is shrinking rapidly and transactions are declining. • The principle area where the organization expects to focus on future development is to shorten the credit period granted to the end customer, take care of its loan boss before the development period, and then pay in installments. The organization also expects to be able to carry out effective inventory management, and can adopt “just in time” (JIT), “financial quantity” (EOQ) and other systems. • Due to the free credit, the organization needs to pay additional fees, such as conspiracy and account fees
Reference

Collins, R. (2007). The BBC and “public value.” M&K Medien & Kommunikationswissenschaft, 55(2), 164-184.
Besserman, J., & Mentzer, R. A. (2017). Review of global process safety regulations: United States, European Union, United Kingdom, China, India. Journal of Loss Prevention in the Process Industries, 50, 165-183.