Kudler Fine Foods: A Comparison Virtual Organization Essay

Pages: 2 (925 words)  ·  Bibliography Sources: 1  ·  File: .docx  ·  Level: College Junior  ·  Topic: Business

Kudler Fine Foods: A Comparison

Virtual Organization Strategy Paper

Strengths for Expansion Options

Kudler Fine Foods is a gourmet food shop that opened in 1998 and by 2003 the gourmet food store had opened two more stores bringing the total to three in just a few short years. The store has been popular with customers because unlike most gourmet food stores, Kudler not only stocks the food and ingredients to customers to prepare a complete gourmet meal, it also stocks all the utensils and cookware needed to prepare the meals. The fact that the company was able to expand so quickly and successfully in just a few short years is a testament to how successful the store is. Kudler would like to continue to expand and therefore must look at all of its options in order to make this happen. Kudler Fine Foods has three options to expand its operations. They can go public through an IPO, they can acquire another company in the same industry, or they can merge with another organization. All three of these options must be considered carefully.

IPO Strengths

By going public through an IPO, Kudler Fine Foods can make a public offering, in which it offers its shares for the sale to the general public. An IPO is typically made by small, rapidly growing companies that either require additional capital to continue expanding or have met a milestone for going public that was established in a contract signed earlier in order to obtain venture capital funding. Kudler Fine Foods needs anlarge amount of capital that the IPO would give them to expand operations.

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IPO Weaknesses

TOPIC: Essay on Kudler Fine Foods: A Comparison Virtual Organization Assignment

When a company becomes public, so do all of its dealings. That means that financial records and other information will be made available for the public to see. The cost of going public can be very expensive and Kudler should be aware of this going into the IPO. When a company goes public, it is supported by those that buy stock in it. If the company is not doing well, shareholders have the option of selling their stock which could place the company in a bad situation. According to Cowan, stockholder expectations can hinder long-term plans, and options can quickly go underwater in a volatile market (2010).

Acquisition Strengths

By acquiring another company, Kudler Fine Foods could gain more employees and another location to serve and expand its customer base. By acquiring the proper company, Kudler Fine Foods could also gain assets such as the acquisition of a winery or cheese maker could give them an inside and exclusive source for their goods along with knowledgeable employees.

Acquisition Weaknesses

With any acquisition, it should not automatically be assumed that those employees whose company was taken over will be willing to freely… [END OF PREVIEW] . . . READ MORE

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