Part VII CBC Video Case

These questions are based on Canadian Broadcasting Corporation videos that accompany the textbook. In addition to whatever in-class use your instructor may have given them, they're available on this website for online viewing. If directed to do so by your instructor, you can answer the discussion questions online and email the results.
     These videos are intended only for students using the 4th Canadian Edition of Fundamentals of Corporate Finance. To view the video, you'll require a password. Refer to page 472 in your textbook and use the first word appearing in the main text column as both 'username' and 'password.' Use of the word is case-sensitive.
     The free RealPlayer plug-in is required in order to view the videos. If needed, the plug-in can be downloaded from Real.

Organics to You
The Trials and Tribulation of Going Organic: Andrew has pioneered selling organic fruits and vegetables in the lower mainland of British Columbia. At the beginning of 1998, with countless competitors walking in his footsteps, Andrew is ready to expand his business in a bid to remain the number one organic food distributor in that region. He plans to customize the bin delivered to health conscious consumers by letting customers pick and choose their own products. This endeavour requires even more coordination, planning, and real-time decision-making than before. Andrew is bringing new complexity and sophistication into the business, but neither he nor his assistant manager, Marion, can handle these new challenges without the help of a modern computer system. The new computer system is needed to handle inventory, customers' orders, and many other tasks. However, its implementation is not exactly a walk in the park.
     Working capital management is one aspect of financial management that is often overshadowed in the media by stories about the stock market, mega-mergers, and multi-billion-dollar investment funds. Yet, working capital management is not simple or unimportant. It requires top management skills and can make or break the fate of the corporation.

Additional Resources:
Small Potatoes Urban Delivery
Wachowicz's Web World–Web Sites for Discerning Finance Students
Association for Financial Professionals

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1		As it appears obvious, Andrew has his hands full with the never-ending challenges of expanding his business. This project is likely to put Marion's and his management skills to a test. However, there is a bright side to managing this expansion. What are the advantages of working capital management in a relatively small firm like Organics to You?
2		What is the main disadvantage of having only Andrew and Marion in charge of working capital management?
3		How is Organics to You different from other firms, such as Ford or GM in terms of working capital management?
4		One of the main obstacles in the path to expansion for a company like Organics to You is the rate at which it can afford to grow. If the operating cycle is too long, or total asset turnover is too low, the rate of sustainable growth suffers accordingly. What is one possible solution to solving this problem?