Types of Businesses
One of the most crucial aspects of managing an organization is coming up with a consistent method of funding operations and projects. For-profit, not for profits, and technology organizations take different ways of financing their operations. For-profits organizations get finances from bank loans, revenue from sales, and local investors. Not for profits, organizations get finances from donations, government grants, and corporate sponsorships. For technology organizations, the leading source finances are through crowdfunding, which is a type of online funding fundraising. The three types of organizations differ mainly due to the mode of financing.
Starbucks
The company I have chosen is Starbucks. It is the biggest coffeehouse chain worldwide through exploiting opportunities and overcoming weaknesses by utilizing exceptional strategies. The company has, in the past ten years, had upward growth and development. Starbucks is now aiming to become an essential player in markets all over the world. Due to its tremendous growth, the company has attracted the attention of large companies all over the world. My research will unravel the mystery behind the exceptional growth of Starbuck. The current stock price for Starbucks is $73.59 as of the year 2020. Starbucks’ strengths to survive and grow exponentially include a sharp brand image, large international supply chains and modification through subsidiaries. However, weaknesses also exist. They include high prices for products sold and imitability of foods and drinks.
Chapter 5
Dollar returns a financier earns divided into two classifications; revenue paid by financial asset issuer and the alteration in the worth of the asset in the financial market over a while (Gordon, Oswalt, & Cooley, 2017, p. xx).
The cost of money is affected by production opportunities, inflation, risk, and preference of tome for consumption.
The liquidity preference theory proposes that a financier should ask for an upper-interest rate on securities that mature in the long term and carries a higher risk. I agree with this theory since interest rates on securities in the short-term are lower because investors tend not to sacrifice liquidity for larger timeframes.
Market Segmentation Theory proposes that short and long-term interest rates are dissimilar. It is based on the fact that the market for all segments of bond maturities includes mainly the investors who are inclined to invest in securities with specified durations.
Chapter 8
A sales forecast is an essential tool in a business used in a month-to-month prediction of the level of sales expected (Hofmann-Stölting, Clement, Wu, & Albers, 2017, p. 3). Accurate sales forecast helps avoid problems in unforeseen cash-flow and managing staff, financial, and production needs more efficiently
A balance sheet shows the financial position of a business on a particular date. It summarizes the assets, equity, and liabilities of a business. Liabilities are debt, obligations, or responsibilities that a business owes someone while assets are items of ownership translatable into cash.
A break-even analysis helps an entrepreneur understand a business proposition viability and risk levels involved in starting a business. Additionally, it helps an entrepreneur to forecast time a business will take to be profitable.
John Maynard Keynes
John Maynard Keynes was an economist from Britain in the 20th century famously recognized as the inventor of Keynesian economics. Many of his ideas were groundbreaking. Keynes was an outspoken proponent of government interventions and full employment as a means to end economic recessions (Mini, 2016, p. 4). Keynesian economics’s basic idea is that if an investment of an economy exceeds its savings, inflation will result conversely if savings of an economy are higher than investments, recession with the result. I agree with Keynes’s theories since, in them, he has brought about the aspect of government intervention and advocated for government involvement in the unemployment crisis.
References
Gordon, S., Oswalt, I., & Cooley, T. (2017). Why spend one more dollar on M&S? Observations on the return of investment. The Profession of Modeling and Simulation, 287-324. doi:10.1002/9781119288091.ch14
Hofmann-Stölting, C., Clement, M., Wu, S., & Albers, S. (2017). Sales forecasting of new entertainment media products. Journal of Media Economics, 30(3), 143-171. doi:10.1080/08997764.2018.1452746
Mini, P. (2016). John Maynard Keynes: A study in the psychology of original work. Springer.