Case Study: Read and understand the case carefully and answer the given questions below. Ricardo Cortez and Josie Hernandez were partners in a apparel factory in Pampanga. They had 150 workers in the 2000s, who helped them manufacture different designs of clothes, shoes, slippers, etc. which they displayed and sold by the thousands in their store at the Clark Expo. They were considered very successful at that time. Their apparel business slowed down when either of them doesn’t know the problem regarding on their financial information on how badly their company is performing in terms of income management. Ricardo and Josie often quarreled about it and to their different management styles. Ricardo had more entrepreneurial characteristics: creative/innovative, flexible, updated on new trends, and was willing to take risks. Josie belonged to the “old school” of businessmen who could not understand Ricardo’s propositions regarding the rehabilitation of their business: getting business loans, introducing unique clothes designs, opening “tiangge” stalls, online selling, etc. She was contented with the small profits they were making. Since their business is a partnership, Ricardo cannot carry out his plans without Josie’s consent. Josie’s pessimism, for him, is unacceptable and he foresees the closure of their business in a few more years if Josie will go on with her way of thinking. 1. What is their problem? What do you think will happen to their business’ market condition in the future?

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Case Study: Read and understand the case carefully and answer the given questions below. Ricardo Cortez and Josie Hernandez were partners in a apparel factory in Pampanga. They had 150 workers in the 2000s, who helped them manufacture different designs of clothes, shoes, slippers, etc. which they displayed and sold by the thousands in their store at the Clark Expo. They were considered very successful at that time. Their apparel business slowed down when either of them doesn’t know the problem regarding on their financial information on how badly their company is performing in terms of income management. Ricardo and Josie often quarreled about it and to their different management styles. Ricardo had more entrepreneurial characteristics: creative/innovative, flexible, updated on new trends, and was willing to take risks. Josie belonged to the “old school” of businessmen who could not understand Ricardo’s propositions regarding the rehabilitation of their business: getting business loans, introducing unique clothes designs, opening “tiangge” stalls, online selling, etc. She was contented with the small profits they were making. Since their business is a partnership, Ricardo cannot carry out his plans without Josie’s consent. Josie’s pessimism, for him, is unacceptable and he foresees the closure of their business in a few more years if Josie will go on with her way of thinking. 1. What is their problem? What do you think will happen to their business’ market condition in the future?

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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