Patagonia

Patagonia sells rugged clothing and gear to mountain climbers, skiers, and other extreme-sport enthusiasts. The company is also well known for its environmental stands and its commitment to product quality. Patagonia has never owned a fabric mill or a sewing shop. Instead, to make a ski jacket, for example, it buys fabric from a mill, and zippers and facings from other manufacturers, and then hires a sewing shop to complete the garment. To meet its own environmental standards and ensure product quality, it works closely with each partner to make sure the jacket meets its rigid standards.

As a result of these standards, Patagonia does as much business as it can with as few partners as possible and chooses its relationships carefully. The first thing the company looks for in a partner is the quality of its work. It doesn’t look for the lowest-cost provider, who might sew one day for a warehouse store such as Costco and try to sew the next day for Patagonia. Contractors that sew on the lowest-cost basis, the company reasons, wouldn’t hire sewing operators of the skill required or welcome Patagonia’s oversight of its working conditions and environmental standards. What Patagonia looks for, more than anything, is a good fit between itself and the companies it partners with. It sees its partners as an extension of its own business, and wants partners that convey Patagonia’s own sense of product quality, business ethics, and environmental and social concern.

Once a relationship is established, Patagonia doesn’t leave adherence to its principles to chance. Its production department monitors its partners on a consistent basis. The objective is for both sides to prosper and win. In fact, in describing the company’s relationship with its partners, Patagonia founder Yvon Chouinard says, “We become like friends, family—mutually selfish business partners; what’s good for them is good for us.”

Build-A-Bear Workshop

A similar set of beliefs and actions describe Build-A-Bear Workshop. Build-A-Bear lets its customers, who are usually children, design and build their own stuffed animals, in a sort of Santa’s workshop setting. Like Patagonia, Build-A-Bear is a very socially conscious organization, and looks for partners that reflect its values. Affirming this point, Maxine Clark, the company’s founder, said, “The most successful corporate partnerships are forged between like-minded companies with similar cultures that have come together for a common goal, where both sides benefit from the relationship.”

Also similar to Patagonia, Build-A-Bear thinks of its partners as good friends. Reflecting on her experiences in this area, Clark said, “I tend to think of partners as good business friends—companies and people who would do everything they could to help us succeed and for whom I would do the same.” In a book she wrote about founding and building Build-A-Bear into a successful company, Clark attributes having good partners to careful selection. She also likens business partnership to a marriage, which has many benefits but also takes hard work: “Good business partnerships are like successful marriages. To work, they require compatibility, trust and cooperation. Both parties need to be invested in one another’s well-being and strive for a common goal.”

Both Patagonia and Build-A-Bear make extensive use of partnerships and are leaders in their respective industries.

Questions for Critical Thinking

1. 1. To what extent do you believe that Patagonia and Build-A-BearWorkshop’s ethical cultures drive their views on partnering?

2. 2. Assume you were assigned the task of writing a code of conduct for Patagonia. Write the portion of the code of conduct that deals with business partnership relationships.

3. 3. What similarities do you see between the partnership philosophies of Patagonia and Build-A-Bear Workshop?

4. 4. Spend some time studying Patagonia by looking at the company’s website and its Facebook page, and via other Internet searches. Describe Patagonia’s general approach to business ethics, social responsibility, and environmental concerns. What, if anything, can start-ups learn from Patagonia’s philosophies and its experiences?

Use motivational interview strategy to convince a 35 year old computer engineer was complaint of breathlessness and palpitation. Display the interview questions between the nurse and the patient

Interview two police managers about instances when they've had to act on intuition, include what the result were.

It can be a make believe interview

In this week's discussion you are going to be the CEO of a company.  In anticipation of the upcoming quarterly disclosure of profits, you prepare your Board of Directors for the challenge that cost-push inflation having on profits.  Please make yourself CEO of only one of these hypothetical companies.

All America Grocery Inc - We serve communities in the middle of the income market providing low prices for all basic grocery needs. Our modest income consumers expect goods deals on good quality foods.  The Covid-19 pandemic has put upward pressure on the price of everything we sell. We have also experience rising cost in every aspect of our operation as we must put extra resources in to protecting both our employees and the public. We are both fortunate and unfortunate that the price elasticity of demand for food is .20.  

Now explain:

• Is the demand curve for your product relatively elastic, inelastic, or unitary elastic?  Demonstrate for your company's product, by how much the quantity demanded will change if you pass on a 10% increase in cost. In other words, show your calculation of the percentage change in the quantity demanded given a 10% change in your price. You must provide a calculation showing the percentage change in quantity demanded.
• Given your company's and price elasticity of demand and the industry supply/competitive environment you face prepare a statement for your board as to the potential impact on profits.   Who will pay the larger share of the cost increases, your firm, or your customers?

Clarification on policy on references. In general, you will not actually need a reference to reply to a discussion.  These are problem solving exercise. You are creating a solution, but you may choose to use a reference.  If you do use a reference, it must be an academically credible reference. Remember that the reference you select is part of your credibility. Never use investopedia, Wikipedia, or any other predia. These are not acceptable. Use of one of these will mean zero credit on the exercise.

Second, the discussions are a learning activity. We will assess your progress on the topic, but that is not a grade. If you have not mastered all the insights, you will find feedback to help you improve your understanding. Use that to do additional post to improve and we will re-assess our evaluation.

The challenge for many students is that, yes you do have to do a calculation to answer this question.

Here are the calculations . In the problem you are given ϵ and you are told the % ∆ ? is 10%. So how much does quantity demand decrease?

Now, if ϵ is less the 1, the item is price inelastic. If ϵ is greater than 1 then the item is price elastic. Which firms will have the hardest time passing on any increase in cost as an increase in price? Think back to our formula on the percent contribution margin to look at how profits might be affected. Remember (P-AVC)/P?

The CEO of a large manufacturing company is curious if there is a difference in productivity level of her warehouse employees based on the region of the country the warehouse is located. She randomly selects 35 employees who work in warehouses on the East Coast (Group 1) and 35 employees who work in warehouses in the Midwest (Group 2) and records the number of parts shipped out from each for a week. She finds that East Coast group ships an average of 1299 parts and knows the population standard deviation to be 350. The Midwest group ships an average of 1456 parts and knows the population standard deviation to be 297.

Using a 0.01 level of significance, test if there is a difference in productivity level. What is the p-value? (Round to four decimal places) p-value =   

Discuss the pros and cons of investing in Russia. As a CEO of a company in the oil industry would you invest in Russia? How does a stable government affect a country’s ability to attract investment?

You are the CEO of a private company and want to buy it. There is one major shareholder who owns 70 percent of the firm. The remaining 30 percent is held by oceanic shareholders. Based on a DCF model, you estimate the base value of the firm to be $100 million. This excludes any liquidity discount and/or control premium. Based on your observations of the market, liquidity discounts are about 30 percent and control premiums are about 15 percent for similar deals. Your firm has 80 million shares outstanding.

What would you offer to pay in total and per share to the controlling shareholder? To the oceanic shareholders?What if it were not a private company but a public company. Show how would that change your calculation and answers?

Be sure to caluclate the DLOM/liquidity factor first then the value of the control/minority. Please make an excel chart.

Here are the financial results for Springer’s corporation in 2020: Sales were $45,000, cost of goods sold was $36,000, the company’s assets depreciated by $5,000 and the company paid $500 in interest.

Also, for 2020 net fixed assets were $29,000 while current assets were $10,000 and current liabilities were $5,500.

These are the values for 2019: net fixed assets = $25,500, current assets = $8,800 and current liabilities = $5,000. The tax rate is 35%.

1. What is net income for 2020?
2. What is the operating cash flow for 2020?
3. What is the cash flow from assets for 2020? How do you interpret this result?
4. What is the cash flow to shareholders?

Here are the financial results for Jerry’s corporation in 2020: Sales were $45,000, cost of goods sold was $36,000, the company’s assets depreciated by $5,000 and the company paid $500 in interest.

Also, for 2020 net fixed assets were $29,000 while current assets were $10,000 and current liabilities were $5,500.

These are the values for 2019: net fixed assets = $25,500, current assets = $8,800 and current liabilities = $5,000. The tax rate is 35%.

Required:

1. What is net income for 2020?
2. What is the operating cash flow for 2020?
3. What is the cash flow from assets for 2020? How do you interpret this result?
4. What is the cash flow to shareholders?