The reason that bank financing is unavailable for T&E startup. Case summary: T&E is a hamburger restaurant in Chicago area started in 2009 at the time of great recession. They financed its operations by themselves and with the help of third partner VN. Both the partners have work experience in McD as executives. Recognizing the need of finance function, they hired Brian as a CFO who is a former executive of McD. According to CFO cash flow is an important element in starting up a restaurant because of the known costs such as rent, payroll, inventory, taxes and utilities as these are recurring and relative costs incurred on weekly or monthly basis. T&E uses a technological inventory management and control system for the perishable nature of foodstuffs associated with the restaurant business. CFO explains that the restaurant has net 14 credit terms with its food vendors. This means that the invoice is to be paid within 14 days after the receipt of the goods. It is a form of financing which allows company to turn the inventory once or twice during the 14 day period. According to Eddie, the goal is to increase the stores by 10 and then look at franchising the operation. Characters in the case: The characters that in the case are T&E, VN and BG. Adequate information: According to Eddie, the goal is to increase the number of stores by 10 and then look at franchising the operation. When considering the location where to open a new operation. He indicates that the careful consideration is to give demographics of area like average income of people, age and population.

Question

Want to see the full answer?

Answer 1

Question

Chapter 18, Problem 3VC

Summary Introduction

To determine: The reason that bank financing is unavailable for T&E startup.

Case summary: T&E is a hamburger restaurant in Chicago area started in 2009 at the time of great recession. They financed its operations by themselves and with the help of third partner VN. Both the partners have work experience in McD as executives. Recognizing the need of finance function, they hired Brian as a CFO who is a former executive of McD.

According to CFO cash flow is an important element in starting up a restaurant because of the known costs such as rent, payroll, inventory, taxes and utilities as these are recurring and relative costs incurred on weekly or monthly basis. T&E uses a technological inventory management and control system for the perishable nature of foodstuffs associated with the restaurant business.

CFO explains that the restaurant has net 14 credit terms with its food vendors. This means that the invoice is to be paid within 14 days after the receipt of the goods. It is a form of financing which allows company to turn the inventory once or twice during the 14 day period. According to Eddie, the goal is to increase the stores by 10 and then look at franchising the operation.

Characters in the case: The characters that in the case are T&E, VN and BG.

Adequate information: According to Eddie, the goal is to increase the number of stores by 10 and then look at franchising the operation. When considering the location where to open a new operation. He indicates that the careful consideration is to give demographics of area like average income of people, age and population.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Considering contemporary challenges in business, analyze a real-world case where a company successfully navigated a major shift in its marketing strategy to adapt to changing market dynamics. Discussion Question and Prompt: Identify the key factors that contributed to the success of their marketing strategy in the face of contemporary issues. How can businesses draw insights from this case to inform their own marketing strategies amid current business challenges? Introduction and Problem StatementThis report examines ...[Include a statement of the main problem in the case.]Background[Detailed company/case background tying directly to the context of the specific case study.Summarize data from the case scenario that is pertinent to solving the stated problem.]Analysis[Thoroughly analyze the questions asked of you here as well as the main questions suggestedwithin the case study.]Alternatives and Evaluation[This section should list some options available as solutions and discuss the…

Which of the following circumstances justifies a lack of agenda? orivide correct answer and why The meeting is informal and routine. There wasn’t enough time. Agendas are not part of company culture. The meeting leader is exceptionally busy.

I need help answering the following questions below What does succession planning entail and what are its essential steps? Are there any disadvantages to using a nine-box grid for succession planning? Would having any difficulty in categorizing anyone who reports or has reported to you into one of the boxes? If you never managed a team, think about employees you have worked with in the past and how you would categorize them. Do most people frequently move from one box to another or do most people tend to stay in one box for long periods of their careers?